To: scratchmyback who wrote (4890 ) 5/6/2007 2:10:43 PM From: Eric L Respond to Replatforming Nokia S30/S40 Entry Level Handsets ..."During the first quarter, we ran a commercial pilot of our new low-cost, single-chip Champion platform. We plan to continue the roll-out of Champion this quarter across existing and new products." — Rick Simonson, Nokia CFO — seekingalpha.com techon.nikkeibp.co.jp >>At 9mm thick, Motofone is marketed as Motorola's thinnest phone. Its screen displays simple graphics rather than text, providing the means to move between voice calls and text messaging, as well as to navigate and retrieve messages. Motofone is currently bundled with Indian carrier BSNL at a price of Rs1,650 (US$37) and doesn't come with features such as MP3 or video playback. Nokia is expected to match Motorola's move by unveiling its own ultra-thin ULC model, the Barracuda, in 2007. ... The evolution of ULC phones was made possible through the integration of the RF subsystem with the digital baseband processor on the same chip, leading to a drastically reduced bill of materials cost (BOM) for handset developers. In developing single-chip basebands, chip makers had to overcome low supply voltage, interfering with RF components. Once the technical obstacles had been overcome, handset design houses were able to cut component costs by 75% and manufacturing cost by as much as 50%. At the forefront of the single-chip baseband migration is Texas Instruments Inc (TI), whose LoCosto single-chip baseband powers both Motorola's Motofone and Nokia's Barracuda. By leveraging its DRP digital RF processor architecture, TI was able to integrate both RF and baseband functions into a single 90nm chip. Including Nokia and Motorola, TI has already signed up 15 handset brands, including some of China's leading domestic brands, to develop handsets based on LoCosto. tinyurl.com focus.ti.com DARP: tinyurl.com focus.ti.com The Single Chip Family Gradual Ramp (Lehman Brothers)The Nokia 1200 and Nokia 1208 are expected to serve as the replacements for Nokia’s current entry level 1110 and 1600 handset offerings. Good volumes of these new 1200 and 1208 handsets are expected in 3Q07, as the ramp is expected fairly quickly. The 1200 and 1208 handsets – from a margin perspective – will not likely outsell the 1110 and 1600 handsets until 1H08 however. Some GM progress is expected in 2H07 from these phones (largely on the “newness” factor), with a fuller lift to margins from these handsets expected in 1H08 (lower component count, more efficient design, single chip benefits). Entry level gross margins for Nokia currently average ~30% (compared to Sony Ericsson’s mid to high tier GM blend at ~30%). The volume ramp of the 1200 and 1208 is expected to be similar in strength to the 1600, where in only the 2nd quarter of shipping, gross margins on the 1600 were actually above the entry level average for handsets. ###
