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Wild cards galore in handsets
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EE Times


CLENDENIN_MIKEAs Nokia Corp. seemingly falters and shows signs of weakness, the sharks are quickly gathering to nip and chomp bits of market share, with Samsung Electronics leading the attack.

Last month at Singapore's CommunicAsia, the region's largest telecommunications show, Samsung and Nokia both pushed out a load of phones-but the South Koreans clearly captured the higher ground, releasing about 20 new phones, including petite, camera-ready slide models, to the Finnish company's five offerings.

Nokia, long a stalwart of the candy bar-style phone, shifted its attention to the clam-style phones that are popular in Asia and which have been at the heart of Samsung's product line. But the move made Nokia look like it was playing catch-up and execs admitted as much in interviews, saying they had slipped in the development of midend phones that are catching on in Asia, the largest handset market.

Instead, they have been frittering away R&D dollars on niche products that have flopped in this part of the world. Such distractions carry Nokia further from its hope of gaining 40 percent market share. The latest from International Data Corp. still shows Nokia with a commanding lead, even though it slipped nearly 5 percent recently to 29.3 percent of the market. Besides building niche phones, IDC said Nokia also focused too much on entry-level products.

Taking advantage of the slip-up was Motorola, gaining 2.7 percent to 16.6 percent market share, based on a 50 percent year-on-year surge in GSM camera phones. Samsung stepped up to 13 percent market share, on the back of an 88 percent year-on-year shipment increase.

The numbers are indeed impressive. "Five years ago, no one, not in their wildest dreams, would have guessed that Samsung would be one of the top three handset vendors," said David Hind, general manager of Qualcomm China.

Meanwhile, another group of Koreans is on the march. While in Singapore, execs from LG Electronics boasted that their company would be top dog when third-generation cellular starts to gain momentum, and that would bootstrap LG into being a top-three handset supplier. By the look of the company's advanced phones with video chat capability, this is no pipe dream.

Another company, possibly a wild card, also strives for a fast flight to the top. China's largest domestic handset maker, Ningbo Bird, believes that within three to five years, its international revenue will outpace domestic revenue.

Qualcomm's Hind, a China veteran of several years, warns against pooh-poohing such ambition, once again citing Samsung. Bird is gathering the necessary pieces, striking alliances with Sagem and, more recently, Siemens to develop R&D skills that will complement a low-cost production base.

Nokia at 40 percent share? Unlikely, unless it learns to design like the Koreans and forges stronger ties with the Chinese.

Taiwan bureau chief Mike Clendenin can be reached at mclenden@cmp.com.





The views and opinions expressed in this column are strictly those of the author and should not be taken as an editorial position of EE Times or any of its other editors, publications or Web sites.


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