So What is Nokia Up To at The High End Cell Phone Segment?

A prior article looks at Nokia’s new 105 candy style phone that it will retail for $20 to capture volume at the low end market. What is it planning for the Lumia/high end lines?  Recently Apple show cases the images that people capture with their iphones in a new commercial that is very effective in connecting with people directly.  Perhaps taking a page from the Alicia Keys, BlackBerry Keep Moving effort? Although, BlackBerry seems to have a problem taking the message to the people as effectively, with all lines of its marketing. Nokia Growth Partners, the venture- capital arm of Nokia (NOK1V) Oyj, plans to invest in California startup Pelican Imaging as it seeks to win back customers from Apple Inc. (AAPL) and Android devices with cameras that provide greater depth and more image manipulations for a better final image.

According to Adam Ewing (http://www.bloomberg.com/news/2013-04-29/nokia-invests-in-high-resolution-cameras-to-woo-apple-customers.html):

The Pelican investment is part of a push to differentiate Nokia as it tries to stimulate demand in its Lumia smartphones, which run Microsoft Corp.’s Windows software, to reverse falling sales and recover market share.

Lumia sales rose to 5.6 million in the first quarter, up from 4.4 million in the previous three months. Still, Apple and Android-based devices control more than 90 percent of the smartphone market to Espoo, Finland-based Nokia’s 3 percent, according to researcher Strategy Analytics. Imaging quality is one of the top three reasons to buy or return a phone, and as Nokia phones are known for their cameras, it’s seen as a good leverage point, according to Nokia Growth Partners.

Array cameras, which use multiple optics and mesh the data into one image, “are on the cusp of being commercialized and Pelican does software for that,” Bo Ilsoe, a partner at Nokia Growth Partners, said yesterday in a phone interview from California. “It’s very complicated to do this algorithmically and Pelican is one of the companies that has mastered this technology.”

Nokia Growth Partners has been tracking Mountain View-based Pelican since soon after its founding in 2008, Ilsoe said. Pelican also counts Globespan Capital Partners, Granite Ventures, InterWest Partners and IQT among its private-equity investors, according to its website.

Nokia, which bought Lund, Sweden-based imaging-software maker Scalado last July, released the 41-megapixel 808 PureView last year and is incorporating the technology in smartphones including the flagship Lumia 920. Nokia Growth Partners has also invested in Menlo Park, California-based image-sensing technology company InVisage Technologies Inc. and micro-optics maker Heptagon, headquartered in Singapore, to bolster its capabilities.

Nokia shares, which have fallen more than 80 percent since the iPhone was introduced in 2007, were unchanged at 2.53 euros at 1:48 p.m. in Helsinki trading after climbing as much as 1.6 percent today. The shares have dropped 14 percent this year.

Nokia Growth Partners has around $600 million under management. It’s made two other investments from its latest $250 million fund. Typical investments are between $4 million to $7 million and are usually capped at about $15 million. It expects to invest in as many as six other companies this year, Ilsoe said.

“Over the next three to five years, mobile enterprise and advertising will be areas we’ll continue to invest around,” he said. “We build a portfolio and a better in-depth understanding of ecosystems by having this approach.”

So What is Nokia Up To?

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I have been with T-Mobile for about ten years, and my first phone was, if I recall correctly, a Nokia candy phone of the Symbian  60 model 3300 variety.  I learned to text message on this device. Along the way, I have also had a Samsung SGH-R255M, pictured above, that fits the palm of my hand, and a Sony Ericsson T80.  I have had a Nokia slider Music 5300 that also fit nicely in the palm of my hand, that I still carry with me when I travel to Canada or Europe and slip in a local SIM card.  I must say that I do like the ability to easily slip my phone in my pocket.  The 5″ sized Samsung of late boggles my mind, as one needs a purse for such a phone.

My introduction to smart phones, was really, I guess,  a pseudo smart-phone, the Nokia 5230 Nuron, which I was (I hate to admit it, but it is true..) using until I finally cut the SIM and stuck it into the OS 10 Dev Alpha device a few months ago.  Having been using the BlackBerry OS 10 device, it is not likely that I will go back to Nokia, especially with the Windows partnership.  None the less, I recently decided to buy some Nokia stock to balance my BlackBerry holdings.  At $3.32 it is a bargain, and I think it can only increase in value over the long term.

Nokia 5230 Nuron shown above

So, I thought that I would write about what Nokia is up to, near as I can see.  It seems like the company is betting on volume sales by making an innovative phone that will sell for $20. The Nokia 105 features preloaded games, a color screen, a radio, a speaking clock and a flashlight. The phone, Nokia’s cheapest ever, has been available for a few weeks in India and Indonesia and will soon start selling in Europe.  The phone is expected to have margins of 20% and compete with the Chinese entries from ZTE and Huawei Technologies Co. that have whittled away at Nokia’s volume sales of low end phones.  The same can be said about what is now happening to BlackBerry’s OS 7 base.  The idea is to build brand loyalty at the low end to carry through to the higher end Lumia lines.  From the Bloomberg article referenced below:

“The low-end, high-volume part of the mobile-phone market is a huge opportunity for Nokia (NOK1V) in developing countries,” said Francisco Jeronimo, an analyst at IDC in London. “These users will be likely to upgrade to more expensive phones over time, so it’s a good strategy to keep a high market share in this segment. The 105 is “very competitive” and should help Nokia with its low-end recovery effort, said Neil Mawston, an analyst at researcher Strategy Analytics in London. A predecessor to the 105, called the 1280, sold more than 100 million units over three years. Simpler phones have “been the bedrock of Nokia’s business for the past decade,” Mawston said.

Nokia’s expertise in handset production makes it possible to turn a profit on a $20 phone, Jeronimo said. For years the world’s largest mobile-phone maker and now No. 2, Nokia makes more than 600,000 phones a day in seven factories around the world, using parts from suppliers it knows well. Chinese rivals may be able to make a device as cheap as the 105, but they lack the features and services from Nokia, Jeronimo said.

The candybar-shaped 105 is 25 percent cheaper than the Nokia 1280, yet its battery lasts 56 percent longer — 35 days. The phone is resistant to water and dust and comes with text- message-based tools that teach English and provide basic health- care advice.

Despite such features, the company sought to simplify the phone’s software, which in turn allowed it to use cheaper parts, said Dirk Didascalou, head of R&D for Nokia’s mobile-phone business.

“To be successful at the low end, one needs to explicitly do innovative work with a focus on delivering value,” he said by phone from Nokia’s research facility in Beijing. “If you don’t, you get in a cost spiral where you’re always a bit too expensive compared to somebody else.”

Even as the slump in simple handsets has stolen investor attention, Nokia’s main goal is to make a full recovery in smartphones, where profit margins are widest. Apple (AAPL)’s 32- gigabyte iPhone 5 sells for $750, while Samsung’s Galaxy S4 goes for $640 and Nokia’s flagship Lumia 920 is $450.

Nokia sold 5.6 million Lumia phones, which run on Microsoft Corp. (MSFT)’s Windows, in the first quarter, up from 4.4 million in the previous three months. But the iPhone and Android control more than 90 percent of the smartphone market, while Nokia has just 3 percent, according to Strategy Analytics. So it’s far from clear Nokia can break that dominance even if its low-end devices recover, said Mikko Ervasti, an analyst at Evli Bank in Helsinki.

“Nokia may still be the second-biggest phone maker in the world,” Ervasti said. “But if it’s going to have a chance at long-term success it needs to make sure it also has the right smartphones.”

Nokia Sees Revival With Handsets at 97% Discount to IPhone

Nokia 105 shown above

Disclosure: I am long on BBRY & NOK.

No implicit or explicit suggestions for stock purchases are made herewith or anywhere on this site.

photo and quote source: http://www.bloomberg.com/news/2013-04-28/nokia-betting-on-20-handset-as-it-loses-ground-on-iphone.html

T-Mobile Has The BlackBerry Z10 In Store Today in The USA

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T-Mobile will finally have the Z10 in stores today.  If you are in NYC, the first 10 people in line will get Alicia Keys tickets for her upcoming NYC gig and $25 off the new Z10, at the TMO store on 34th and 6th.  The phone is being offered for $531.99 and on contract. With the new “Simple Plan”, one can get a new Z10 for $99 down and $18/month for the phone with other costs for monthly usage. From the TMO site:

BlackBerry® Z10

T-Mobile’s new 4G LTE BlackBerry® Z10 is powered by BlackBerry® 10 – an intelligent and intuitive experience that constantly adapts to your needs. Every feature, every gesture, and every detail is designed with you in mind. Discover how BlackBerry® Z10 keeps you moving.
• Peek into BlackBerry® Hub from any app to see messages
• Type effortlessly on the new touchscreen BlackBerry® Keyboard
• Chat face-to-face and share screens with BBM™ Video and Screen Share

BlackBerry® Z10

Specs
    • Size:
    • 5.12 x 2.58 x 0.35 inches
    • Weight:
    • 4.83 ounces
    • Included battery:
    • 1800 mAh
  • Camera:
  • 8 Megapixel Camera
  • Video:
  • BBM™ Video with Screen Share
  • Talk time:
  • Up to 10 hours
  • Standby time:
  • Up to 13 days
  • Band (frequency):
  • UMTS: Band I (2100);UMTS: Band IV (AWS);UMTS: Band IV (1700/2100);UMTS: Band V (850);Quad Band GSM
What’s in the box?
  • Battery
  • Charger
  • SIM Card
  • T-Mobile Start Guide
  • RIM Safety Information Booklet
  • USB Cable

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BlackBerry CEO, Thorsten Heins, On Pierce Morgan Live at 09:50 EST

BlackBerry CEO, Thorsten Heins, On Pierce Morgan Live at 09:50 EST

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Right after discussing the latest impasse in the Middle East the avid BlackBerry user, Pierce Morgan, had CEO, Thorsten Heins on his show this evening, March 20, 2013, at @ 09:50 EST.  When asked why his two boys should switch from the iPhone, by Pierce, Thorsten responded that he thinks “that with the new BlackBerry Z10 there is an advantage over Apple’s much older and dated iOS. There’s no in and out, in and out with the BlackBerry Z10, you just flow and flick and use the hub for all your messages and social media.” Heins stated that three main features that are unique to BB10 and should bring people back are 1)BlackBerry “Balance” to separate work and personal on one device, 2)the new user interface with the new “Hub”, “Peek and Flow” and 3)the smart keyboard with the legendary physical keyboard on the Q10. Pierce, said that he did like the new device and that he was a supporter  and  stated, “I hope that the new devices do well because I like them.”

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