Telecom Lead Asia: Indian telecom market has remained the second largest revenue generator for Nokia in 2012, behind China, despite falling sales.
Nokia’s revenue includes revenue from devices, location businesses and Nokia Siemens Networks.
In 2012, Nokia India generated revenue of €2.227 billion against €2.923 billion in 2011 and €2.952 billion in 2010.
Nokia — in its latest annual report said — the 10 markets in which Nokia generated the greatest net sales in 2012 were, in descending order of magnitude, China, India, Japan, the United States, Brazil, Germany, Russia, the United Kingdom, Indonesia and Italy, together representing approximately 52 percent of total net sales in 2012.
In comparison, the 10 markets in which Nokia generated the greatest net sales in 2011 were China, India, Brazil, Russia, Germany, Japan, the United States, the United Kingdom, Italy and Spain, together representing approximately 52 percent of total net sales in 2011.
Nokia is also concerned feature phone makers in China and India.
The devices major says a feature phone-specific ecosystem has emerged involving very low-cost components and manufacturing processes. Speed to market and attractive pricing are critical factors for success in affordable devices.
“In particular, the availability of complete mobile solutions chipsets and software from low-cost reference design chipset manufacturers has enabled the very rapid and low-cost production of feature phones, increasingly at lower price points, by numerous manufacturers particularly in China and India, which are gaining significant market share in emerging markets, as well as bringing some locally relevant innovations to the market,” Nokia said in its annual report.
Many mid-range to high-end feature phones increasingly offer access to the Internet and applications and provide more smartphone-like features and design, blurring the distinction between smartphones
and feature phones and can be categorized as smartphones.
Nokia is subject to intense competition 15 over the entire spectrum it addresses through Mobile Phones business unit from very low cost voice centric devices to devices that can be categorized as smartphones.
Nokia, which works with Microsoft for sourcing operating system, also talks about the success of Google Android.
Nokia says that smartphones of other manufacturers, particularly Android-based smartphones, are reaching lower price points, which is increasingly reducing the addressable market and lowering the price points for feature phones and competing with the higher-end devices from our Mobile Phones portfolio.
“We are also seeing the emergence of various local mobile device manufacturers that are strong in a certain country or region, especially in emerging markets. Success of such competitors could adversely affect sales of our mobile devices in various countries such as China, Indonesia and India where we have been traditionally strong,” Nokia’s annual report says.
Nokia has also shared its concerns about the recent tax raid. “During early 2013 Nokia became subject to a tax investigation in India, apparently focusing on Indian tax consequences of payments made within Nokia for the supply of operating software from its parent company in Finland. Such proceedings can be lengthy, involve actions that can hinder local operations and the outcome of such proceedings is difficult to predict. Negative developments or outcome in such proceedings could have adverse effects to our cash flows, income statements and to our financial position.”
Baburajan K
