* Unveils entry level 15 euro device
* Launches 139 euro Lumia smartphone
* Says targeted at markets such as China
By Paul Sandle
BARCELONA, Feb 25 Nokia launched a
15-euro ($20) phone to shore up its position in the basic
handset market, where it has lost share while it focused on
developing expensive smartphones.
It also unveiled a 65-euro phone with some Internet access
and lower-priced versions of its Lumia smartphones, filling the
gaps in its product line-up between its high-end Lumia devices
that run Microsoft software and mid-tier Asha feature
The Finnish company hopes the new phones will increase sales
in emerging markets and help it regain its once-solid footing at
the cheaper end of the market, where it makes the bulk of its
handset revenue. Sales of basic phones fell over 20 percent in
2012 to 9.4 billion euros.
"That is a key part of our approach to competition,
particularly in a country like China," said Chief Executive
Stephen Elop at the Mobile World Congress in Barcelona.
"There's a very large number of inexpensive and largely
undifferentiated devices. We believe we have to offer
differentiation at each price point."
The entry-level Nokia 105, its lowest priced ever device
with a colour screen, was aimed at first-time buyers in markets
such as South America, Africa, Russia and Asia-Pacific, he said.
The phone shows Nokia, once the undisputed leader in the
mobile phone industry, trying to fend off growing competition at
the low end from Asian rivals such as Huawei and ZTE
IDC research director Francisco Jeronimo said it would
probably be the cheapest phone available in the world from a
major brand when it goes on sale later this quarter.
"The pressure is now on the Chinese vendors. Why will any
consumer in the world buy a cheap Chinese phone when they can
have the same price with better quality from a well known
brand?" he said.
LOWER LUMIA ENTRY POINT
The Finnish phonemaker also lowered the entry point of its
Lumia smartphones with a new model, the Lumia 520, priced at 139
Most other Lumia phones cost over $200, and the
top-of-the-range 920 can retail at over $600 without a carrier
contract in the United States and some European markets.
The 920 model was launched last November and has won
plaudits from industry analysts for features such as photography
and mapping. Sales, however, have been dwarfed by devices from
the likes of Samsung running Google's
Android and Apple's iPhone.
Nokia's market share in smartphones has fallen to around 5
percent, while Apple and Samsung together control over half the
A new lower entry point for the Lumia 520 would enable Nokia
to better compete with some mid-tier Android devices, analysts
Feature phones, in the middle market between high-end
smartphones and cheaper basic phones, are seen increasingly
crucial even though many consumers in developed markets are
moving on to smartphones.
"In short, Nokia can still cash the feature phone market
with around 5 percent margins even though it is shrinking," said
Inderes analyst Mikael Rautanen.
IDC's Jeronimo said the new products, which included the
Lumia 720 smartphone with the same camera lens as the 920, gave
Nokia a comprehensive range, leaving little excuse for poor
"If Nokia does not improve its market performance with these
devices, then they will never do without a radical change in its
portfolio strategy," he said.