Nokia (NYSE:NOK) is expected to post a dip in quarterly earnings when it reports results Jan. 27. However, the company's new Symbian smartphones are performing well in the market, analysts said--a bright sign for Nokia as it revamps its smartphone strategy.
The Finnish handset giant is expected to take a hit in global market share, and while its position in smartphones has been weakened by the likes of Apple (NASDAQ:AAPL), Research In Motion (NASDAQ:RIMM) and a variety of devices using Google's (NASDAQ:GOOG) Android platform, analysts are now worried that Nokia could be losing share in the low end of the market.
"We remain concerned about market share issues in the low end due to local competition in emerging markets such as India and Middle East and Africa," UBS analysts wrote in a research note. Companies such as China's ZTE and Huawei have been working to compete on the low and high end of the market.
Despite this, analysts told Reuters they are seeing solid demand for Nokia's latest Symbian smartphones, such as the N8 and C3, devices that will be key to Nokia's smartphone strategy going forward. Nokia plans to rely on Symbian for the bulk of its smartphone sales, but also will leverage its nascent MeeGo platform for high-end devices; Nokia plans to release several high-end MeeGo devices this year. The company has provided little information about its device roadmap for this year, but could unveil new devices next month at the Mobile World Congress trade show in Barcelona, Spain.
While Nokia has repeatedly committed to MeeGo and Symbian, there is fresh speculation that Nokia could partner with Microsoft (NASDAQ:MSFT) on a range of smartphones running Microsoft's Windows Phone 7 platform. Canaccord Genuity analyst T. Michael Walkley said in a research note that a partnership between the two firms would make sense for a number of reasons, chiefly that each could provide what the other is missing in the smartphone market.
"We believe Microsoft needs more support from a leading device OEM to compete with Android longer term, and Nokia likely needs to adopt a new, high-end smartphone strategy to stem smartphone share losses," he wrote. "Further, Microsoft could create a differentiated tablet strategy with stronger enterprise support and Nokia could clearly benefit with a tablet and smartphone combined strategy that is offered by competitors. ... We believe the combination of Microsoft's marketing muscle and software expertise with WP7 and Nokia's global brand, distribution and scale advantages could drive solid sales of WP7-based devices worldwide. Additionally, it would provide Nokia a much-needed re-entry into the North American market, where its market share has stagnated at low-single-digit levels for multiple years."
For more:
- see this Reuters article
- see this AllThingsD article
- see this FierceWireless Q4 earnings page
Related Articles:
Rumor Mill: Nokia, Microsoft could partner on Windows Phone 7
Nokia promises new smartphone UI paradigm with MeeGo
Nokia to take control of Symbian platform development
Nokia taps Qt as its sole app development framework
Nokia to slash 1,800 jobs after beating Q3 estimates