Figures released today show Nokia has increased its dominance of the mobile handset market.
Figures released today show that Nokia has increased its lead in mobile handset sales. The Finnish firm made 33.9% of all mobile phones sold in Q4 2000, up from 31.4% in Q3. Closest rival Motorola saw its share fall from 17% to 14.6%, while third-placed Ericsson fell from 10.5% to 10%.
It’s certainly good news for Nokia. The company has been under pressure lately, since overall growth in handsets is failing to meet expectations. Since 72% of Nokia’s revenues for 2000 came from mobile handsets, a slowdown could jeopardize its 25-30% growth targets. The delay the firm has experienced in shipping its GPRS high-speed handsets, from Q2 to Q3 this year, has also worried observers.
Still, in handsets Nokia has two major advantages – brand and product leadership. Nokia is the most powerful brand in mobile handsets, associated with high quality and innovative products. The company has also so far ensured its products arrive at just the right time to hit market trends. This is largely due to its customer-driven research program, which ensures the firm knows what its customers want and can provide them with it rapidly. While the GPRS delay may imply these standards are slipping, it does reflect a wider trend as operators and other manufacturers also delay GPRS rollout.
Nokia needs to boost its presence in the portal and content development market, increasing the size and scope of its Club Nokia portal. It should also aim to develop its infrastructure business further, although admittedly it is already the world number two. But most importantly, it must avoid complacency in its core operation. Nokia seems to have won versus its current major rivals, as Ericsson has outsourced its lossmaking handset production operation and Motorola has shifted its focus entirely to high-end devices. Yet growing competitors like Alcatel and Siemens in the European market and Samsung in Asia would love to grab more of the pie – and if Nokia takes its eye off the ball they may get an opportunity.
