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Technology Stocks : Nokia (NOK)

NOK 6.775

-3.6%

3:59 PM EST

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To: tero kuittinen who wrote (812)	8/1/1998 11:45:00 AM
From: Raymond	Read Replies (2) of 34857

Tero! I am not a Nokia stockholder any more but owns Ericsson.I was stupid enough to sell my Nokias in Februari.But now I think that Ericsson could be a better choice.One of the reason is the valuations of the two companies.I heard that Nokia now for the first time is worth more than Ericsson. Nokia has had a really good period starting last year with getting most of the contracts for new GSM operators.The new operators was mostly for a third operator in the 1800 band.The 1800 band has always been Nokias strongest side.The contracts was signed last year but a lot of the deliveries is this year and that shows in the report as high growth on the infrastrucure side.This year Ericsson has got more or less jackpot when it comes to new operators.In a couple of months Ericsson has got the contract for the 1800 band in Belgium Holland Italy Porugal Spain for example.What is the reason for this exceptional shift? I talked with a guy working for a operator that has both Ericsson and Nokia equipment.He said that Nokias advantages was that the physical size of Nokias switches was smaller and that they generally was a litlle bit cheaper.Ericsson advantage was that they had much higher capacity in their switches.He also mentioned that Ericssons new switchgeneration is about the same size as Nokias but still with the same capacity advantage.Smaller also normally ,means cheaper to build so Nokia might have lost it's edge on the pricingside.This is just my theory of what could have happened. You mentioned that the winning Spanish,Portugese and Italian companies in Brazil all are good Nokia customers.That could be but Ericsson has about 50 % of the market in Brazil and Ericsson is the biggest supllier of infrastructure on the cellular and fixed side to Telefonica in Spain and TIM in Italy.They are also I think the biggest supplier to Portugal Telecoms cellular business. So I think Ericsson has a decent chance to get big a big part of the US50 Billion or what will be invested by the new operators in Brazil. On the mobile side Nokia will probably continue to dominate this year. The reason that Ericsson and Motorola are so slow this year to come up new models could be other that the obvious. Next year GPRS and high speed data is rolled out in the GSM networks.GPRS is packetdata in the air.You are only on the air while sending data and you only have to pay for the data you are transmittimg and receiving.When this is coming data over cellular will for the first time be really popular.The company that implements this complicated new technology first will totally dominate the market for the highpriced business phones.I think that this race will decide which company will be the dominating mobile supplier the coming years. I must congratulate you people on this thread that was smarter than I and kept your Nokias.But the history says little about what will happen in the future/R

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