Incoming Nokia CEO sees US market as trendsetter
2006-03-10 15:33:00
Mobile handset giant Nokia sees the United States market as having importance out of proportion to its size in setting industry trends, its incoming chief executive said in remarks published on Friday.
Success in the United States is more important than just the resulting revenues, said Olli-Pekka Kallasvuo, who takes over from CEO Jorma Ollila in June, in an interview with Finnish weekly magazine Suomen Kuvalehti.
"The United States is especially important, because world trends originate there," he said.
"Many things spread elsewhere from there, rarely the other way round. If something succeeds in the United States, it can easily become a global success. The 'clamshell' phone was an example of this," Kallasvuo said.
Nokia grew its unit sales in North America by 22 percent in the fourth quarter compared to a year earlier, with the region now accounting for about 12 percent of its global volumes.
But researchers Gartner say the Finnish company only has about 21 percent of the North American market, running second to U.S. rival Motorola Inc. and much lower than Nokia's global 35 percent share.
Two years ago, Nokia lost ground to competitors when it misjudged the market for folding or 'clamshell' handsets, and had to scramble to recover market share.
And Motorola also stole a march on Nokia with its ultra-thin RAZR design that fast became an icon after it came out in 2004.
Kallasvuo acknowledged that consumers were currently focused on thin models.
"Design and, for example, the slimness of phones are constantly on the leadership's mind," Kallasvuo said.
With more than one in every three mobile phones sold around the world a Nokia, Kallasvuo attributed part of its success to being able to react to change quickly.
"Fast reaction is often more important than the precise forecasting of market growth. In this we have been better than competitors," he said.
"Often we have tried to operate so that we enter a market at an optimal time -- not too soon. In this way we have often been able to maximize profitability, but sometimes we have been a little bit late and suffered an image hit."
In the fourth-quarter of last year, Nokia reported growing sales boosted by strong demand for its phones, but its profit margins suffered as it sold more low-priced handsets, which also lowered the average selling price (ASP) of its models.
Kallasvuo said ASPs were often misinterpreted.
"The average selling price would be easy to raise, if we left the cheapest phones unsold. But they are all profitable," he said.
Nokia has traditionally led the lower-cost phone market in sales, benefiting from its massive scale and production volumes, but does not see itself limited to that market.
"That you are strong in the lower (price) segment does not prevent you from being strong in the upper segment," Kallasvuo said.
"Different strategies are needed for different segments, but we believe that it is possible to be strong in all at the same time."
|
|
Brown to Develop Handwriting Software Microsoft Corp. is working with Brown University to develop software that will recognize complex handwriting and gestures — beyond the basic handwriting such as signatures that credit card users write on an electronic pad. Adobe Q1 net profit falls; outlook disappoints Design software maker Adobe Systems Inc. on Wednesday posted lower quarterly net income on acquisition-related costs and gave a disappointing outlook, sending its shares down nearly 4 percent. Apache chairman: Days numbered for commercial software The days of selling software through the traditional commercial model are numbered, as open source is becoming the paradigm of choice, said Greg Stein, chairman of the Apache Software Foundation, at the EclipseCon 2006 conference on Wednesday. Microsoft Warns Of Dangerous IE Exploit An exploit for a new zero-day bug in Internet Explorer appeared Thursday, causing security companies to ring alarms and Microsoft to issue a security advisory that promised it would patch the problem. Novell steers Linux to the virtualized datacenter At Novell’s annual gathering of the faithful in Salt Lake City, the company had plenty of news to share, including a new mobile server for GroupWise based on Nokia Intellisync, upgrades to Novell’s SSO (single sign-on) and storage management software, road map information for OES (Open Enterprise Server), and a partnership with Dell, which soon offer an edition of Zenworks Linux Management to server hardware customers running Red Hat or Suse. Open Source Brings Innovation to Big Vendors The specter of open source forces large software vendors to stay on their toes and nurtures innovation, an Oracle official said during a presentation at TheServerSide Java Symposium on Thursday afternoon.
Java Symposium Discusses Web Applications Obstacles to developing Web applications was a critical issue on the minds of Java developers at TheServerside Java Symposium on Thursday. MySpace Helps the Police to Fight Crime Detectives used profiles posted on the MySpace social networking Web site to identify six suspects in a rape and robbery that began when a party turned violent, leaving blood "in almost every room of the house," officials said. Apple Celebrates 30th Birthday Silicon Valley's historic orchards have virtually disappeared but one notable fruit still stands: Apple. As the storied company celebrates its 30th birthday in a week, Apple Computer Inc. will have brushed off its bruises from product failures and arguably misguided decisions to emerge with a shine that's more than skin-deep. Alta Vista Developer Paul Flaherty Dies at 42 Funeral services for Paul A Flaherty, 42, the computer engineer who developed key inventions for the Alta Vista search engine, were held Friday in Menlo Park, Calif. not far from the former Digital Equipment Lab where the pioneering search engine was launched.
|