Nokia Introduces New Phones

SINGAPORE -- World-leading cellphone maker Nokia launched five new models on Monday, including flip phones that were lacking in its portfolio, and expressed confidence it could claw back market share in a booming sector.

The company, which has been losing market share to rivals, showcased its first mass-market flip phones, which it claims is the world's smallest model for fast networks.

"We have now sharpened our product portfolio in key areas, bringing to the market new phones in the mid-range, and adding more clamshells to our offering," CEO Jorma Ollila said in a statement.

The Finnish company, whose brand name and clever designs had given it a commanding lead of more than 35 percent world market share, said in April that it had started to lose out because of a lack of attractive phones in the middle part of its portfolio.

Ollila told journalists at a company event in Helsinki that he would continue to chase a global market share of 40 percent, despite having drifted off to 32 percent in the first quarter.

Market researchers like Gartner say that Nokia's share dropped even further, to 28.9 percent -- still almost twice as much as its nearest rival, Motorola of the United States.

Among Nokia's latest models are a 6260 smart phone with a flip that could swivel, and a 6630 third-generation, or 3G phone, which Nokia says is the world's smallest camera phone for fast 3G networks, equipped with wireless e-mail, web browsing, video calling and other smart phone features.

It unveiled more clamshell camera-phones with the 6170, and a cheaper model, the 2650. Its new lineup also includes the 2600, a traditional low-budget phone for first-time customers.

Lack of flip phones was seen by analysts as a big reason behind Nokia's falling market share.

"The clamshell phones are exactly what's needed so they're filling the right gaps." said Jussi Hyoty, FIM Securities, who rates the shares "neutral."

Other analysts were skeptical, pointing out that Nokia's new models had to compete with a broader lineup from its rivals.

"I wasn't that enthusiastic about the new clamshells, even though the 6260 looked okay. I'm not really sure it can match the competition," said Erkki Vesola at Mandatum Stockbrokers.

He also expressed concern that Nokia had cut the number of new product launches in 2004 to 35 from 40, while much smaller rivals plan equal or more new products this year. Nokia shares were off 1.8 percent at 11.72 euros at in early trading, underperforming a 1.3 percent lower Eurotech index. The stock has lost almost one-third of its value since the company said its market share was eroding.

During the last year, rivals had been faster to market with handsets boasting high-resolution displays, cameras and other features.

Motorola and third-ranked South Korea's Samsung boosted their market shares in the first quarter to 16.4 percent and 12.5 percent respectively.

Nokia's new models were first shown at a company event in Singapore, where flip phones are the gold standard, underlining Nokia's focus on the region.

Simon Beresford-Wylie, Nokia senior vice president for Asia-Pacific, said he expected "dynamic" growth in regional cellular subscribers, estimating that by 2007 for every fixed line user there would be more than two cellphone users.

In the three years to 2007, the number of mobile subscribers globally will have climbed by some 700 million to two billion and Nokia expects about 300 million of the new subscribers to come from growth markets in the Asia-Pacific region.

"Clearly the industry is thriving. Throughout 2004, around 800,000 new subscribers have joined the mobile world every day," said Nokia board member Matti Alahuhta.

Nokia said it expects cellphone sales for the industry to reach 600 million units this year, up from 520 million in 2003 -- a forecast that is in line with industry estimates. Camera phones are expected to make up one-third of total sales.