Nokia banks on emerging markets in Asia Pacific to spur global growth

SINGAPORE – Finnish telecommunications giant Nokia, the world’s top manufacturer of mobile phones, is banking on the emerging markets in the Asia Pacific region to boost its continued growth, top company officials said.

Tyler McGee, Nokia vice president for SEAP Customer & Market Operations, told a regional roundtable forum held here recently that growing demand in India and Indonesia – two of the world’s most heavily-populated nations – along with brisk sales in Vietnam, Thailand and the Philippines, helped the company build a stronger base to expand its global business.

The company’s Asia Pacific operations exclude China and Japan, which are treated as separate markets.

"Strong growth markets like India, Indonesia and Vietnam will be instrumental towards propelling the industry towards three billion people connected globally by 2010," he said.

A large chunk, or 60 percent, of Nokia’s worldwide net revenues of 15.455 billion euros in the first half of the year is accounted for by the mobile phone business. The rest of Nokia’s sales are derived from its networks infrastructure (20 percent); multimedia (17 percent); and enterprise solutions (three percent).

McGee said Nokia’s significant stride into CDMA (code division multiple access) territories such as Indonesia, Australia and New Zealand strengthened its position with a solid market share among the top four CDMA subscribers globally.

As a European player, Nokia has traditionally adopted the GSM (global system for mobile communications) technology, hence, until lately, trailed behind the CDMA platform which is the norm in the US, Japan and South Korea, among others.

With the advent of 3G (third generation) technology or WCDMA, which features phones with faster data speeds and videoconferencing capabilities, McGee said Nokia has emerged as a clear leader, hooking up 28 million subscribers in 78 3G-enabled countries, growing at a dizzying rate of 10 percent monthly.

Nokia, which sold its one billionth mobile phone last quarter, commands a 33 percent global market share and expects this to rise to 40 percent with the steady launch of more new models – both entry-level units and those with high-end capabilities. It has so far come out this year with 34 new models – including upgrades of popular units – and would release six more before yearend.

"We foresee that over half a billion people will own a camera phone by the end of 2005. The camera phone market will grow to over four times the digital camera market," said Mauro Montanaro, Nokia’s vice president for multimedia in Asia Pacific. "We are now the world’s largest manufacturer of digital cameras, music players and handheld computers."

He added that for 2005, Nokia expects to sell close to 100 million camera phones, about 40 million music devices (with MP3 player) and approximately 25 million smartphones whre Nokia is a dominant player with over 50 percent market share.