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Technology Stocks : Nokia (NOK) -- Ignore unavailable to you. Want to Upgrade?

To: slacker711 who wrote (16022)	10/22/2001 9:52:59 PM
From: slacker711	Respond to of 34857

FEATURE-Nokia, Motorola struggle in Asian handset markets By Nam In-soo Monday October 22, 9:31 pm Eastern Time SEOUL, Oct 23 (Reuters) - Lee Byung-il bought a fold-type Nokia mobile phone two months ago, attracted by its simple but stylish look compared with the snazzy and feature-packed handsets produced by local makers. ADVERTISEMENT The 30-year-old South Korean businessman likes the design, but thinks it is less user-friendly than the one he used before -- Samsung Electronics' Anycall. ``Nokia's mobile phone is typically European,'' Lee said of the inconvenience in using text messaging. ``I have to go through several stages to get to the email directory. Also, I have to hit 'enter' after keying in one Korean word after another. It doesn't fit Korean tastes.'' The world's top mobile handset maker Nokia and the second largest Motorola (NYSE:MOT - news) have been doing business in South Korea for years. TINY MARKET SHARE But they have only tiny market share in the face of tough and innovative competitors, including homegrown giants Samsung Electronics Co Ltd and LG Electronics Inc , who between them control more than 75 percent of the domestic market, estimated at some 4.4 trillion won ($3.4 billion) last year. Nokia debuted two models using Qualcomm Inc's (NasdaqNM:QCOM - news) code division multiple access (CDMA) technology earlier this year, targeting Koreans -- among the world's most ardent mobile users. ``In the beginning, we heard some complaints similar to those about Korean handsets, but they have been addressed and we offer after-sale services through our care centres,'' said an official at Nokia Korea. Nokia is committed to being a long-term growth partner in Korea and intends to offer Korean consumers innovative products and solutions to meet their needs, he said. Park In-a, 23, who uses a Motorola handset, says her mobile phone is flashy but weak and expensive. ``I will buy a Samsung or LG phone next time,'' she said. Motorola entered the Korean mobile phone market in the early 1980s but is still a distant third with a market share of about 10 percent market, according to industry estimates. ``You cannot say Motorola's business here is a success,'' said Shin Hyun-ho, an analyst at LG Investment and Securities. ``Nokia's first CDMA phone launch is also a flop.'' BAD TIMING Analysts said the timing of Nokia's entry into South Korea was not particularly good, given what rivals were offering. ``Nokia brought nice 2G (second generation) mobile handsets to the Korean market, when many users were already getting hooked on the beauty of 2.5G phones,'' said Shin at LG Securities. ``Plus, Nokia is still an unknown name to many Korean people.'' South Korea's top mobile carrier SK Telecom introduced cdma2000 1x or 2.5G mobile service last October, converting almost one million users to 1x phones. The other two wireless carriers also began services in May this year. Motorola unveiled three 1x models in May, but Nokia Korea said it would unveil a 2.5G phone in the first quarter of next year. ``We plan on a massive investment in Korea to launch an aggressive marketing campaign for colour-screen 1x phones due to come out around the end of this year,'' said an official at Motorola Korea. TECHNOLOGY MATTERS IN JAPAN In Japan, foreign handset makers have been minor players because of different networks Japanese mobile operators use and their competitors' advanced mobile technology. Nokia and Swedish telecom equipment maker Ericsson supply their products to NTT DoCoMo Inc and other carriers. But they have had a hard time catching up to their Japanese competitors as mobile carriers use a Japanese-developed network called PDC (personal digital cellular) for 2G services. Motorola used to supply its products to DoCoMo and a mobile unit of KDDI Corp , but not any more. ``Technology to manufacture mobile handsets has become complex, making it more difficult for foreign makers to beef up their market share in Japan,'' said Yoshihide Otake, an analyst at Tsubasa Securities. ``Nokia, for instance, has not introduced Java-compatible models yet.'' SAMSUNG TARGETING TOP THREE Samsung Electronics, the world's fifth largest producer of cellphones, has said it was gaining global market share in mobile phones and was targeting the top three, with its latest technology, including 1x and global positioning systems (GPS). 1x technology boasts CD-quality sound and data transmission at speeds several times faster than the 2G technology and even faster than Europe's GPRS (General Packet Radio Service), which also offers an always-on Internet link. This partly explains why cellphones in Europe are on average much larger than in Asia and do not sport the colour screens and high sound quality that Koreans and Japanese are used to. ``We are targeting to sell 28 million handsets globally this year, up from 22 million in 2000 due to strong demand in 1x phones,'' said a Samsung spokeswoman. ``For the domestic market, we are not making 2G phones any more.'' ($1=1292.0 Won) (With additional reporting by Eriko Amaha in Japan)