Nokia Facing China Backlash After Years of Dominance - ResearchInChina

Date:2011-08-16hanyue  Text Size:

While the rest of the world buzzes about Google's (Nasdaq: GOOG) blockbuster deal to buy Motorola Mobility (NYSE: MMI), eyes in China are more focused on a worrisome report regarding struggling Nokia (Helsinki: NOK1V), which once dominated the Chinese market but is rapidly losing share to up-and-comers like Apple (Nasdaq: AAPL) and Samsung (Seoul: 005930). According to the report, a growing number of Chinese sellers are refusing to accept shipments of Nokia phones, in what looks like a rebellion after years of being bullied by Nokia when it dominated both the China and global markets.  (Chinese article) The article doesn't provide a lot more detail, but does say the insurrection has been going on since April, and could see Nokia report sharply lower sales in the world's largest cellphone market by subscribers when second-quarter numbers start to come out. If true, this rapid fall in fortunes for Nokia would mirror its rapid global decline. Chinese consumers, like everyone else, are always looking for the latest and coolest cellphone, and Nokia's offerings just don't look nearly as sleek as smartphones from Apple or Samsung. What's more, lower end producers like ZTE (HKEx: 763; Shenzhen: 000063) are appealing to more cost-conscious consumers, offering cool, low-priced smartphones costing as little as $100 each based on Google's Android operating system. Nokia, by comparison, can only offer phones based on its own Symbian system, which most people find uninspired and is due for retirement by the end of this year. The trend for Nokia resembles what happened several years ago in China to Motorola, whose fall from grace was also rapid and for similar reasons. If this report is true, and I think there's a good chance it is, Nokia could easily lose its crown as the top mobile phone seller in China within the next year.
 

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