Nokia Yesterday released its first quarter 2013 results and there are encouraging signs on their report. Although Nokia made operating loss of $196 million, the figure is a great improvement compared to a year ago, when its operating loss was $1.7 billion. And the most interesting aspect of the report is the Nokia sales of Lumia phones.
In term of Volumes during the first quarter 2013 Nokia shipped 6.1 million Smart Devices units, of which 5.6 million units were Lumia products and 0.5 million units were Symbian products. Two third of those Lumia devices were Windows Phone 8-based products. The overall outlook for the smartphones is weighed down by the symbian devices but the number of Windows devices is a clear indication that Nokia is the right track
While Lumia is coming up strongly there was huge decline in the feature phones shipment by Nokia. The number of shipped feature phones declined by 31% on year by year comparison and by 33% compared to the last quarter. During the first quarter 2013 Nokia shipped 55.8 million Mobile Phones units (feature phones), of which 5.0 million were Asha full touch smartphones. The question I am asking at this point is, is this a clear sign of the smartphone adoption across the globe or is it a matter of competition taking toll even to the lower end of the market for Nokia? Nokia Mentioned on their report that the sales were affected by the competition not just from the other lower end feature phones but from entry level smartphones. In Africa for example the likes of Tecno and Huawei are coming up strongly and expected to eat into Nokia’s lower end market market share. For example a simple walk along the streets of Nairobi, especially those sides of Tom Mboya street and one realize the kind of effort Tecno is making to capture the feature phones market. But at this point I don’t think Nokia and others should be worried. The rate at which people are changing their phones from feature phones to smart phones is amazing and it is just a matter of time .
The battle as I see it, especially in Africa is already at the entry level smartphones. Huawei started it off with Ideos, and then Samsung and others took over from there. Nokia Lumia range of devices are showing good signs but there is a problem especially when comes to making phones that can compete with the likes of Samsung Galaxy Pocket and Intel Yolo, in terms of the pricing. The Windows platform requires higher minimum specs for the entry level smartphone, making Lumia phones very expensive when compared to Andoid phones of the same range. For example Lumia 620, is awesome phone but selling it at over Ksh.22K, may discourage significant number of people who probably could have bought it in the first place. Time Nokia and Windows look at this keenly, so that they can give people great Lumia Phones at affordable rates