UG. Poor Quality bad for NOK; bad for QCOM; bad for the Industry
London, April 8 (Bloomberg) -- Nokia Oyj's mobile phones have developed more faults in recent months, and that could cost the world's largest cellular-phone maker as much as 150 million euros ($131.4 million) a quarter, Dresdner Kleinwort Wasserstein analyst Per Lindberg said.
As much as 70 percent of Nokia's output harbors defects, and insurers may refuse to extend warranties or could demand more compensation from the company as a result, Lindberg said in a note to investors. Nokia's direct costs for repairs could rise to $6 to $7 a phone, compared with an industry average of $1, he added.
The company's 8210, 3310 and 3330 handset models have displays that stop functioning after a few weeks, while Nokia's 6210 handset goes ``dead on an intermittent basis,'' Lindberg said in the note, which cited distributors and repairmen.
Nokia officials weren't immediately available to comment.
``The problems are causing irritation among distributors, operators and end-users alike,'' said Lindberg, who has a ``sell'' recommendation on Nokia. The Finnish company's shares dropped 1.15 euros, or 5 percent, to 21.87, their biggest one-day decline since March 12.
The online version of Swedish magazine Mobil said today Nokia has problems with displays of phones based on the 3300 series and that some switch off when they receive text messages. |
