Thursday, 24 January 2013

Nokia shows signs of life, but North America market still a blip - CNET

Sales remain small -- albeit growing -- in region despite a strong push by AT&T and its phones showing up at Verizon Wireless.

January 24, 2013 6:18 AM PST

The Lumia smartphones on display at the flagship Nokia store in Helsinki.

(Credit: Roger Cheng/CNET)

Nokia's got a pulse again, but it'll take a lot more to fully jolt the company back to life.

The Finnish mobile device maker earlier reported its fourth-quarter results, and the signs are encouraging. After several quarters of losses, the company returned to profitability. Its Lumia brand appears to be taking hold, with the company selling 4.4 million units in the period.

Stlil, Nokia has a lot of work left. While it made steady progress in North America, it remains a relatively small market despite AT&T's flagship push of the Lumia 920 and Verizon Wireless selling its first Nokia phone in several years. The scant numbers underscore the difficulties that the Finnish company faces as it attempts to breach this market.

Given its nascent presence in North America, it was one of the few markets that showed growth. Its revenue in the region nearly quadrupled to $196 million, although unit sales only rose to 700,000 from 500,000 a year ago, when the Lumia phones hadn't yet launched in the U.S.

While the direction for the numbers were positive, they represented a fraction of the figures found in other regions, highlighting the competitive environment here. In 2012, Nokia went big early with a splashy launch of the Lumia 900, and then rode the coattails of Microsoft's Windows 8 push in the second half of the year.

Most of the sales likely came from AT&T, which has touted the Lumia 920 as its exclusive flagship smartphone. It's unlikely that the Lumia 820 at Verizon made much of an impact, with so much of the sales going to Android and iPhones and the phone receiving little marketing or sales support.

Nokia CEO Stephen Elop has talked about slow and steady progress, and the company at least appears on track for that. This year could be better with Elop hinting at a possible flagship phone for Verizon Wireless, which would pair well with another expected strong offering at AT&T.

Nokia on the edge: Inside an icon's fight for survival

But in the U.S., it's still unclear whether the Windows Phone brand will take hold. At least for the early part of the year, the carriers appear to be preparing their resources behind Research in Motion's BlackBerry 10 operating system, which debuts next week. Nokia is also still competing with HTC's Windows Phone 8X, which Microsoft anointed its flagship device for Windows Phone 8.

And while the 4.4 million Lumia phones sold around the world mark a sign of progress, it's a tiny percentage of the massive amount of Android smartphones and iPhones sold each quarter. Apple, for instance, sold 47.8 million iPhones in its recently reported fiscal first quarter.

So despite getting back to profitability, Nokia still needs to embrace that sense of urgency.

A rare view of Nokia's home turf (pictures)

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