ALKHOBAR: In line with many other ICT companies, Nokia recently commented on market conditions impacting its business as well as updated its fourth quarter 2008 outlook and gave a preliminary outlook for next year. Nokia noted that the global economic slowdown, combined with unprecedented currency volatility, has resulted in a sharp pull back in global consumer spending impacting the global mobile device market. The world’s largest manufacturer of mobile handsets also remarked that the mobile device market has been negatively impacted by the more limited availability of credit, which has curbed the purchasing ability of some of Nokia’s trade customers.
Nokia now expects that for the fourth quarter 2008, industry mobile device volumes will be approximately 330 million. This is sequentially up from the estimated 310 million in the third quarter of 2008 and would result in a current estimate of industry mobile volume of 1.24 billion in 2008. While Nokia continues to expect its mobile device market share in the fourth quarter 2008 to be at the same level or slightly up, sequentially, it does expect that Devices & Services sales and profitability in the fourth quarter 2008 will be negatively impacted. Worse, Nokia’s preliminary industry outlook for 2009 is that mobile device volumes will be down in 2009 compared to 2008, impacted by the continuing overall economic slowdown.
What does all this mean? It means that for the foreseeable future, Saudi Arabia and other markets outside the US, especially emerging markets, will be more important than ever for all handset manufacturers. In light of this, Juha-Pekka Sipponen, director, Ultimate Product Group, Nokia Nseries paid his first visit to the Kingdom to determine what more could be done to boost the Nokia brand.
“I am here with my team to get better acquainted with Saudi Arabia’s market,” he remarked. “The Saudi Arabian market is one of our top five or six countries in the world. We want to get a better understanding of how we can work here in a better way. We’ve had great success in the Kingdom with the Nokia Nseries, but we are still looking at how to respond to the market in new ways.”
Since January 2008, Sipponen has been heading one of the two product groups in category management for the Nokia Nseries multimedia devices. In this role, he is responsible for overseeing the development of the product portfolio for flagship convergence products such as the Nokia N95 and Nokia N96.
“We have done a lot for Saudi Arabia and for other Arab markets and we can be quite proud of this. For example, our support for the Arabic language and our customizations and adaptations for these markets have been well received” Sipponen pointed out. “There are competitors to us but we see that with the new products we have introduced into the market, such as the Nokia N96, Nokia N85, Nokia N79, the entire N-series product range has been renewed. We have a mix of good products with full features, turn by turn navigation, clear displays, good multimedia capabilities and good Internet capabilities. These features and design innovations are key reasons for people to buy our devices.”
Nokia’s handsets are clearly popular in the Saudi market with some of its mobile devices even earning local monikers or nicknames. But the company needs to move beyond basic hardware alone if it is to have continuing success. Sipponen mentioned that Nokia’s developer resource “Forum Nokia” (www.forum.nokia.com) is active in the region, however he believes that this is “an area where we hope to improve.” Additionally, the company is working to effectively make available more “out of box” accessories — those accessories that aren’t included in the initial handset purchase.
The more interest Saudi consumers show in Nokia, the better it will be for the company’s bottom line. And it seems that they are taking the challenge seriously. Sipponen related that Nokia was sponsoring market research activities during his visit.
“I’ll be listening in on consumer interviews with owners of both Nokia handsets and competitors’ handsets, trying to understand how they see the products and what sort of development directions they would appreciate. This is the kind of feedback that helps us in the future to make our products even more attractive to Saudis and other people in the region.”
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