Nokia loses market share...

From the New York Times, April 17... "Slow to Adapt, Nokia Loses Market Share in Latest Cellphones LONDON, April 16 - Nokia, the world's largest mobile phone maker, paid a heavy price on Friday for missing the trend toward stylish clamshell phone handsets, denting its vaunted reputation as the arbiter of cellphone chic. Biting into Nokia's market share, the company's hottest rival, Samsung Electronics, reported soaring profits, while Nokia forecast a further slump. Nokia shares touched a 13-month low as investors began looking toward other cellphone makers regarded as likely to tap into a market of fleeting fashions and fickle loyalties. "No brand can stay cool forever," said Peter Firstbrook, an analyst with the META Group, a technology research consultant firm in Stamford, Conn. "Nokia has been slow to adapt." The contrast between Nokia, based in Finland, and Samsung, based in South Korea, could hardly have been more stark as they made their announcements a few hours apart. Samsung recorded $2.7 billion in profit in the first quarter, an increase of 178 percent from the period a year ago and its best quarter ever; sales were up 50 percent. Nokia said that the 2 percent drop in its first-quarter profits, announced last week, could be followed by second-quarter sales that are likely to be "slightly below" the $8.4 billion it recorded in the period last year. Samsung executives seemed surprised by the surge in their company's fortunes, and forecast better things to come in the second quarter. Nokia said it was "not satisfied with our sales development during the first quarter." Nokia still has the leading share of the world handset market, manufacturing 35 percent of the 128 million mobile phones sold in the first quarter. But Nokia lost three percentage points of share from the last quarter of 2003, while Samsung, which ranks third by sales volume after Nokia and Motorola, gained ground. Samsung said on Friday that it expected its market share to rise by almost four percentage points, to 14 percent. Nokia said its goal was still to secure 40 percent of world mobile phone sales. Most striking, however, is that recent declines in Nokia's share price mean that Samsung's market capitalization has now overtaken Nokia's as the largest for any technology company outside the United States. The shift in part reflects Samsung's much broader product line, which includes memory chips and flat-screen displays as well as high-end mobile phones, at a time when all those products are fetching high prices. Shares of Nokia, which at one point in the day were off nearly 10 percent, closed at 12.40 euros, down 8.2 percent. Samsung's share price also fell on Friday, along with most Korean companies, but after the day's trading, Samsung's market capitalization was equivalent to $76.4 billion, compared with $69.4 billion for Nokia. "Nokia has obviously made some major mistakes," said Urban Ekelund, an analyst with Redeye, a private research company in Stockholm. "Firstly, they haven't launched clamshell products, which came to Asia one and a half years ago. And second, they haven't launched products with good color screens and cameras." By contrast, Samsung has been "focusing on high-end products," Mr. Ekelund said in a telephone interview, while "Nokia has been focusing too much on the low end," and on emerging economies rather than richer markets like the United States. In a television interview, Jorma Ollila, Nokia's chief executive, said, "There were some changes in the products of our competitors, and we were not as swift in moving." In a conference call with analysts, Mr. Ollila said that Nokia planned to introduce 31 new models this year, including about 6 of the flip-top type that Samsung and Motorola were quicker to unveil. But that may not reverse its fortunes. "As you get bigger, you become the target, and it becomes harder to move quickly," said Mr. Firstbrook of the META Group. "Nokia became bigger not necessarily because they were best, but because everyone else was stumbling. Now there is more competition, and the competition is getting better. Nokia is a bit of a dinosaur in terms of changing direction. I don't think there's any one thing they can do to turn around." Even as Nokia shares fell on Friday, those of European rivals like Ericsson and Siemens gained, as investors shifted away from what had once been seen as a rock-solid bellwether stock. The woes came after earlier signs of trouble. On April 6, Nokia warned investors that first-quarter sales had fallen about 2 percent, a performance far short of the company's forecast of a gain of 7 percent. On Friday it said that its second-quarter earnings would probably be 0.13 euro to 0.15 euro a share, well below the 0.19 euro figure of the period a year ago, which included the costs of job cuts. The company also said on Friday that while sales of mobile phones in general rose at a 29 percent annual rate in the first quarter, Nokia's shipments increased by only 19 percent. Operating profit at its mobile phone division fell to 1.09 billion euros." Cruel!!! __________________ Why do I remember the president of Nokia, Ollila, when he came to Korea 4 years ago, and announcing that Korean market will be heavily dominated by Nokia? He was not able to see the future. He officially mentioned about samsung phones 4 years ago, that they are low-tech. And I remember him coming out in the news again, and saying "Korean market is too biased, and self-concerned. No foreign companies can even go into the market. The problem is not Nokia, but korean people". This is why I hate this stupid company. Really, I can only say stupid because they were still saling black and white phone at 2000, when there were only color phones coming out. They repeated this 4 times in a row. Withdrawing and trying again. I've never ever seen any Nokia phones from my korean friends. Nokia was too arogant. What made them to arrogant to underestimate samsung? Well... probably they would know the answer. A month ago, Ollila again visited samsung electronics, to ask for advanced screen supplies and flash memory. Of course, it was rejected. Samsung will only provide low-end parts. If you don't want it, then don't import it. Now they should feel something different. Why did they have to blame korean people for their poor sales in Korea? Why can't they realize that their phones were just not attractive? They had bunch of commercials flooding in the TV, I remember! But their market share in korea was less that 100 phones-_-; (no joke) __________________ sunystory@hotmail.com thats interesting __________________ sunystory@hotmail.com i hope samsung giving the technology of producing a best color LCDs to Ollila and nokia and saving this company from drowning in the digital ocean!!! __________________ saliquincer i hope that nokia apologize to korean people and then ask for better screens btw, i am pretty satisfied with my T616. (SE) __________________ thats right nokis pend money on commercials rather than product and see al their mobile phone they look like stone age models. Poor going nokia __________________ Quote: Originally posted by manee thats right nokis pend money on commercials rather than product and see al their mobile phone they look like stone age models. Poor going nokia I have not seen any Nokia commercial lately but I have seen the overly long SE one (the one with the squirrel) on telly very often. __________________ mib1800 I do feel bad about nokia losing market shares. Even though Ollila said something bad about korean people, I really hope that nokia can revive. Nokia is the hope of finnsih. And I believe they can somehow manage to do this. Mavi forum