Thanks from a lot of us for your recent posts concerning market share, growth, etc. I know it takes a lot of time to get the information together, format it, and then make some sense out of it. We're all grateful for your time and efforts.
I really think that in the long term, Nokia is going to have some serious problems with its Asian competitors, particularly Samsung.
I know your style is to dig through facts and figures and then try to make a call for the future based on what this tea-reading process leads you to conclude. My style is a little different. Though I naturally consider the past few quarters' facts and figures to be important, as a LTB&H investor, I also try to seek out trends. In my view, these are equally significant.
Historical facts and figures with respect to Samsung are admittedly few. Making an accurate call concerning its future is therefore difficult. However, I see a few trends that should worry Nokia LTB&H investors.
1.- Nokia is wedded to making its own chips. Thus far, its efforts with respect to CDMA are less than stellar. Because 3G is a CDMA game, this doesn't bode well for Nokia should it continue this stance. Samsung, on the other hand, recognizes that Q is the leader in all things CDMA and is not averse to using Q's chips. As a result, Samsung is well on the way to preeminence in the 1x market, a market which is going to grow significantly. Nokia seems to have abandoned it, not a good thing for a company whose goal is to carve out a 40% market share on all handsets.
2.- Nokia is becoming chronically late with implementing technology. Samsung is not. Samsung will doubtlessly use Q's 3G chips. Absent a surprise, the trend will be that Samsung will beat Nokia to market with 3G handsets, while Nokia tries to keep its margins high through development of its own UMTS chips. I have lost confidence in this aspect Nokia's strategy.
3.- I don't think that Nokia's recent small loss of market share is necessarily indicative of a long term problem. However, if its competitors continue to nibble away at it, then perhaps the systemic problems that have been noted by my fellow Qultists may have begun to have an effect on the bottom line.
We'll see.
Not selling, but keeping a weather eye on Nokia at this time. |
