February 15, 2010 / 7:02 PM / 10 years ago

Nokia says free satnav to lift services sales

BARCELONA (Reuters) - Nokia’s services unit chief Niklas Savander said he is more confident than before on the unit’s 2011 revenue target due to a strong take-up by phone buyers of the company’s free satellite navigation offering.

A journalist tests Nokia's Ovi Maps free maps on a cellphone during a news conference in Berlin, January 21, 2010. REUTERS/Fabrizio Bensch

The world’s largest cellphone maker Nokia last month followed Google in starting to offer free satellite navigation on its cellphones — raising worries about how the services unit can reach its 2 billion euro sales target for 2011.

However, Nokia said on Monday 3 million consumers have downloaded the free navigation package and the phone unit pays the services division a fee for offering free satnav.

“I am more confident now than I was before about the revenue target — because of the volume,” Savander told Reuters in an interview.

Nokia has said navigation would account for around 50 percent of its services unit revenue this year.

“It could continue to be around half, maybe now even more,” Savander said.

Savander said it was likely that other handset vendors would follow with free navigation offerings.

“It is more likely than not that people will follow suit,” Savander said.

JK Shin, the head of the mobile unit of Samsung Electronics, the world’s second biggest cellphone maker, told Reuters his firm was considering it actively and positively.

However, Bert Nordberg, president of the fourth biggest cellphone maker, Sony Ericsson, said his firm had no imminent plans to offer free navigation.


Nokia has focused in recent years on trying to build up its services offering.

Savander said Nokia’s ‘Comes with Music’ offering — which bundles music download service and a phone — would focus increasingly on the emerging markets.

“You will see significant focus from us on emerging markets. Also the music industry has all the upside on these markets,” Savander said.

Nokia is aiming on reaching 300 million active users for its various services in 2011. It revamped the metrics last month — removing duplicate users — which cut the tally of active users at the end of last year to 62 million from more than 80 million.

Savander said it was likely the metrics would be revised again at six-month intervals, at the end of the staff’s semi-annual bonus rounds.

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