Nokia wades into new music, gaming services

By Tarmo Virki

LONDON (Reuters) - Nokia (NOK1V.HE: Quote, Profile, Research), the world's largest cell phone maker, unveiled an online music store, a gaming service and four new multimedia handsets in a move to take a greater share of consumer spending from mobile operators.

Nokia, which sells more than one third of the world's cell phones and is seeking new sources of revenue as that industry matures, said its core market of making mobile handsets was just "not enough anymore."

"We are trying to make the cake bigger for everyone: our piece grows, but also operators will benefit through data revenues," Tapio Hedman, head of marketing for Nokia's multimedia unit, told Reuters.

Nokia's shares jumped to their highest level in more than five years on the news. But some of its top customers -- mobile phone operators that have built their own music service offerings -- reacted with caution.

"Some operators in Europe will not like this at all," said Shaun Collins, managing director at research firm CCS Insight.

Nokia Chief Executive Olli-Pekka Kallasvuo said at an all-day event in London that the company would start to sell touch-screen phones -- Nokia's answer to Apple Inc's (AAPL.O: Quote, Profile, Research) iPhone handsets -- using its popular S60 software next year.

Nokia shares jumped to levels last seen in April 2002 and then closed 4.6 percent higher at 23.31 euros in Helsinki.

NOKIA OPENS DOOR TO MUSIC, GAMES