Nokia's Loss of Market Share to Smartphone Rivals May Impact 4Q Profits

By Ed Silverstein January 19, 2011

Nokia has been trying to compete against Apple and Samsung in the fierce smartphone business. But the way the market share has been divided among the producers of high-end smartphones, as well as the division among producers of lower-end phones, is having an impact on Nokia’s bottom line.

Reuters is reporting that when Nokia releases its fourth quarter results later this month, the data are expected to show the company’s third successive quarterly drop in profits.

Nokia is anticipated to report a 24 percent drop in earnings per share for the fourth quarter, Reuters reports.

On the other hand, Reuters says that consumer demand has increased for smartphones such as Apple’s iPhone 4 and Samsung's Galaxy S. Apple sold 16.2 million iPhones in the latest quarter, which is its highest sales in a single quarter, Reuters says.

Analysts predict continued demand for iPhones will lead to lower demand for higher-end Nokia products, according to Reuters.

Analysts predict Nokia sold 130 million phones in the fourth quarter, a 2 percent increase over the same time period a year ago.

But new devices from Nokia, such as the C3 and the N8, are in demand, according to Swedbank analyst Jari HonkoIn’s comments to Reuters.

In addition, China's ZTE Corp, a rival to Nokia among lower-end phone providers, said it phone sales increased 34 percent in 2010.

It was recently reported by TechZone360 that Nokia Siemens Networks was ranked first in a recent vendor matrix from ABI Research. The vendor matrix evaluates vendors based on innovation, as well as implementation based on several other factors, explains TechZone360.

In other company news, TechZone360 reported that Opera Software said the Opera Mini 5.1 Beta browser is available for Nokia smartphones.

This new release has been optimized for the Symbian platform. It features speed dial for favorite websites, tabbed browsing, and a user interface, TechZone360 reports.

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Ed Silverstein is a TechZone360 contributor. To read more of his articles, please visit his columnist page.

Edited by Janice McDuffee

TechZone360 Contributor

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