Nokia sees no gain, price drops next year

Nokia at its Capital Markets Day gathering provided a pessimistic outlook for its own fortunes next year in spite of new developments. Company chief Olli-Pekka Kallasvuo says he expects Nokia to take the Symbian interface "to a new level" and improve the user experience. However, the cellphone maker also expects its market share to stay flat in 2010 even though the overall cellphone market is predicted to grow 10 percent next year.

It similarly predicts the average selling price of one of its phones to drop, although Kallasvuo insists the company has "measures in place" to decrease the price of smartphones while still boosting the company's profit margins.

The predictions are partly triggered by cautiousness about the economic recovery but nonetheless provides a relatively conservative outlook when compared to younger competitors like Apple and RIM. The former's phone business is already more profitable than Nokia as the iPhone not only has a higher average selling price but also has a wider profit margin; Nokia is only targeting margins of 12 to 14 percent where Apple's raw manufacturing costs fall well below the unsubsidized retail prices of its handsets.

Apple doesn't usually offer public predictions of its own market share but has lately grown much faster than Nokia, whose share has been described in alternating reports as either growing only slightly or declining. It has been helped by having a modernized OS optimized for touchscreens. Symbian is expected to get major upgrades in 2010 that include one interface overhaul as well as important underlying changes.

By Electronista Staff