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Technology Stocks : Interdigital Communication(IDCC) -- Ignore unavailable to you. Want to Upgrade?

To: Honda who wrote (2570)	12/3/1998 6:05:00 PM
From: D.J.Smyth	Read Replies (1) \| Respond to of 5195

15:00 DJS U.S. Sales Of Digital Handsets Soaring With Nokia Taking The Lead 15:00 DJS U.S. Sales Of Digital Handsets Soaring With Nokia Taking The Lead NEW YORK -(Dow Jones)- Signaling a rapid change in favor in newer, more-advanced communications devices, U.S. sales of digital phone handsets topped sales of analog models through the first three quarters of 1998, market researcher Dataquest said Thursday. Sales of digital handsets totaled 10.1 million units through three quarters of this year, which is 28% above the 7.9 million analog units sold through September. Dataquest said the U.S. digital handset market is on pace to grow 170% in 1998. "The analog-digital crossover, at last, signals the market's protracted transition to second-generation digital phones a full six years after they were first introduced in the U.S.," Dataquest said. Finland's Oy Nokia (NOKA) has been in a hotly contested three-way race for the top spot in the market with Sweden's AB L.M. Ericsson and Motorola Inc. But, according to Dataquest's figures, the race isn't even close. Dataquest said Nokia has taken a commanding lead of the U.S. digital handset market with a 40% share - more than double its 19.8% share in all of 1997. No. 2 Ericsson (ERICY) was far behind at 21%. It had a dominating lead in 1997 over Nokia, as its market share totaled 41%. Dataquest said the impressive surge by Nokia was the result of the "successful launch of its 6100 series phones and its strong association with the AT&T Digital One Rate." Nokia is clearly on a roll. Its first-half pretax profit surged 67%, buoyed by solid sales in the U.S. and strong acceptance of its new line of mobile phones. Those results also beat forecasts, as sales grew 27% in the period. Nokia recently attributed much of its subscriber growth to consumers' acceptance of new products. Indeed, Nokia just unveiled three new products - an analog "wearable" cellular phone and two digital wireless phones. The analog phone, which can store up to 75 names and numbers and includes Caller ID capability, is scheduled for shipping in January. The company also plans to increasingly equip future mobile phones with advanced data-transfer capabilities, such as the ability to exchange business cards electronically, send electronic-mail messages or access the Internet. It also wants to expand its research capabilities for other forms of mobile communications through acquisitions. Nokia has said it plans to invest close to one billion markkaa (about $197 million) between 1998 and 2001 on a new manufacturing and distribution center in Hungary and an expansion of production capacity at its mobile-phone plant in Salo, Finland. Nokia also has charted itself a course to buy several Internet-technology companies over the next year as it seeks to expand its research base to develop new mobile phones and mobile technologies. Ericsson, by contrast, has seen a sharp leveling off in mobile-phone sales growth this year, after achieving spectacular growth in 1997. Sales from its mobile phone and consistently weak Infocom unit softened in the recently ended third quarter, disappointing many experts. Meanwhile, Dataquest said Motorola Inc. (MOT) posted an impressive gain, increasing its market share to 11.5% through the first three quarters of 1998 from 6.3% for all of 1997. Qualcomm Inc. (QCOM), which held the No. 3 spot in 1997 at 17.4% of the market, watched its share drop to 8.2% in the first nine months of 1998. Japan's Sony was close behind, staking claim to 7.1% of the market. "The fast risers, Nokia and Motorola, have grown with strategies to diversify into all digital product segments," Dataquest said. "However, in defense of the Ericsson and Qualcomm strategies, handsets are just a portion of the companies' business, and they have strategic reasons for staying in their niches." Copyright (c) 1998 Dow Jones & Company, Inc. All Rights Reserved. (:ERICY) (:MOT) (:NOKA) (:QCOM) (:S.ERC) (:Y.NOK) 12/03 3:00p CST