Nokia slashes phone prices, eyes recovery

As expected from the No. 1 phone maker in the world, Nokia slashed mobile phone prices across several different product lines late last month.

“This latest round of price adjustments sees Nokia taking its low-cost Symbian devices into new territory,” said Ben Wood, CCS Insight Research Director, in an interview with Reuters.

The Finnish phone manufacturer was warned by financial analysts it would need to reduce certain phone prices as much as 10% — Nokia said it cut prices normally, adhering to “normal, ongoing business.”

The company’s cheapest smartphone, its 5230, is available for 170 euros ($239) in Finland.  Its E71 and E72 smartphones were the best sellers, as Nokia still holds 39 percent of the global smartphone market.  RIM is in the No. 2 position with 19.8 percent, with Apple taking No. 3 with 14.1 percent.

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Nokia needs to find additional ways to compete with RIM, Apple and Samsung.  Global smartphone shipments increased 30% year-over-year during Q4 2009, and the category is expected to see continued growth in 2010, according to Strategy Analytics.

More than 173.8 million smartphones were sold last year, a slight increase over the 151.1 million the year before.

As the smartphone industry grew, so did Nokia’s smartphone revenue in Q4, which increased 26 percent compared to Q3.  I’m most interested to see if Nokia can try to bring its recent success to the United States, where RIM, Apple, HTC, Samsung, and other companies have a bigger share of the smartphone market.

In North America, Nokia needs to aggressively pursue partnerships with wireless providers if they hope to gain significant market share. Consumer awareness on Nokia smartphones is very low in the US, as the brand is not promoted much by wireless providers.

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