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Nokia star fades even in emerging markets

Nokia says it is continuing to invest to attract customers in these markets.

“Our mobile phones portfolio continues to be strong, especially in key markets like India, Nigeria, Brazil and Mexico where the Asha products are receiving record high scores from consumers,” said Mary McDowell, EVP Mobile Phones.

She said the company would be announcing data plans for the new Asha 202 basic phone model with five operators in India on Monday.

Missing Touch

Analysts also say Nokia can be slow to react on popular technology.

In emerging markets, for example, multi-SIM models have been a draw for people who want to take advantage of freebies doled out by competing carriers, but Nokia lacked such phones until mid-2011.

Another costly gap in its basic phones offering is a full touch-screen model. Around 105 million such phones were sold last year globally, according to Strategy Analytics.

“Nokia left the door wide open for Samsung and others by not delivering a full-touch feature phone. The Koreans figured it out three years ago, yet Nokia still does not have a product,” said Ben Wood, head of research at CCS Insight.

“In the meantime, prices of Android smartphones have dropped, and Nokia's window of opportunity is almost closed.”

Nokia is due to unveil a full-touch 306 feature phone model in the coming months.

Slipped Halo

“Nokia's main challenge this year is to arrest the sharp decline in its flagship smartphone portfolio and use it to rebuild a positive halo-effect for the overall Nokia brand,” said Mawston.

The company abandoned its own Symbian smartphone operating system last year in favor of the largely untried Windows Phone alternative after Stephen Elop joined as chief executive from Windows maker Microsoft. Symbian sales have nosedived before the Windows models got off the ground.

This month it started sales of the first Windows smartphones in China with an aggressive marketing campaign and huge ads at subway stations, in magazines and newspapers.

There are some positive noises coming from customers.

“I just bought a new Nokia Windows phone and wasn't very used to its tile design, but the experience was quite good after half an hour. All the basic functions I need are there, and I'm beginning to think that Windows phones will make it,” Wang Xiao said on his Sina microblog.

“Having an operating system which is Windows-based doesn't excite me,” said 22-year old student Akshay Johar in New Delhi, looking at one of Nokia's new Lumia models, but added: “The phone has great features, it looks good, the touch screen is very responsive.”

He is considering buying one, he said.

About 27 million people need to make that decision this year, 55 million next year, and 94 million in 2014, according to analysts polled by Reuters.

That only 2 million did in the first quarter shows how steep is the mountain that Nokia must climb.

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