INTERVIEW: Nokia Launches Phones For Emerging Market Growth

STOCKHOLM -(Dow Jones)- Nokia Corp. (NOK) Thursday unveiled two new low-priced mobile phones to help it bolster its position in emerging markets, which are fueling growth in the global handset industry.

The two new phones will be "very high volume," vice president Juha Pinomaa, who is responsible for so-called entry-level phones, said in a telephone interview with Dow Jones Newswires.

The likes of Nokia are trying to exploit strong growth in developing regions like Africa, China and India. Nokia - the world's largest handset maker - expects the number of mobile phone subscribers to rise to 3 billion by 2010, with much of the increase stemming from emerging markets. That compares with around 1.7 billion users at the end of 2004.

Nokia estimates a retail price before subsidies of EUR65 for the cheapest of the two new phones, dubbed the 1110 model. The 1110 handset, which has a black-and-white screen, replaces the current best-selling 1100.

The other model being launched is the 1600, which has a color screen and an estimated retail price of EUR85.

The phones will feature a new graphic interface that Nokia says will enable illiterate people to use them.

"We remain committed to cutting the cost of phones in the future," said Pinomaa.

Rival Motorola Inc. (MOT) - the world's No.2 handset maker - said in February that it will develop phones for emerging markets that will sell for $40 a piece.

The announcement of the new phones was made in Nairobi, Kenya, and Pinomaa said Africa is the fastest growing region for mobile telephony at the moment.

"We see 100 million subscribers in Africa by the end of 2005 and 200 million by 2009," he said.

The new entry level phones give Nokia margins in line with the Finnish company's overall mobile phone portfolio, he said.

Pinomaa said he is "clearly seeing consolidation" in the mobile phone industry, with leading brand names benefitting at the expense of lesser-known brands.

Company Web site: http://www.nokia.com

-By Magnus Hansson, Dow Jones Newswires; +46 8 545 130 91, magnus.hansson@dowjones.com

(END) Dow Jones Newswires"

Posted to the site on 2nd June 2005