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Nokia bolsters phone lineup
Wed Sep 2, 2009 10:50am EDT
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By Tarmo Virki, European technology correspondent
STUTTGART (Reuters) - Nokia on Wednesday bolstered its smartphone line-up to better compete with Apple and said a $820 laptop will lead its foray into the fiercely-competitive PC market.
The new handsets -- including its first phone using Linux software -- are the latest moves by the Finnish firm to match Apple's innovation in a sector switching focus to services and software, but left market-followers unimpressed.
"Nokia has major challenges on developing user experience, and we might have to wait for a significant improvement until the second half of next year," said Jari Honko, analyst with eQ Bank in Helsinki.
Nokia's offering in the top end of the market worries investors as the firm has rapidly lost market share in the most profitable part of the industry to Apple and RIM.
"We are fighting back. We are on attack," Anssi Vanjoki, head of Nokia marketing, said in a speech.
Nokia unveiled three new phone models and announced further details of its new Booklet 3G, its first laptop.
GETTING INTO PC INDUSTRY
Nokia has seen its profit margins drop over the last few quarters as handset demand has slumped, and analysts have worried that entering the PC industry, where margins are traditionally razor-thin, could further depress earnings.
But Gartner analyst Carolina Milanesi said Nokia had no choice.
"Nokia had to do it. You see more and more PC guys getting into the mobile operators' shelves. It's kind of the counterattack, it's not just defensive," Milanesi said.
John Hwang, the head of Nokia's laptop business, said the company aims to bundle laptops with Nokia's new Internet services to better compete with rivals offering just hardware.
With the move into laptops, Nokia is crossing the border between two converging industries from the opposite direction to Mac-maker Apple, which entered the phone industry in 2007 with the iPhone.
Following Apple, Acer and Asustek have also jumped from PC world to cell phone industry.
"We are witnessing a sizeable shift in the overall industry. No one feels considerably safe," Nokia's Hwang said in the interview.
In the laptop business Nokia will face new rivals like HP, Dell and Acer, and some commentators said the market -- from which IBM pulled out in 2005 -- could be too tough to crack. Continued...
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