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Nokia aims to "close the gap with the competition" in the smartphone market

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Nokia has built a solid foundation for future success, CEO Olli Pekka Kallasvuo told shareholders Thursday.

"By combining services with devices, Nokia is in a stronger position to grow and create more value for our shareholders," Kallasvuo said. "We still have plenty of work to do, but we have built a solid foundation. We believe in our strategy."

Kallasvuo said about 83 million people around the world are already registered active users of Nokia services, which increasingly are included with the purchase of a Nokia mobile device.

As evidence of Nokia's achievements thus far, Kallasvuo cited the following statistics:

  • The Ovi Store, which opened a year ago this month, is now averaging about 1.7 million downloads a day. There are also localized versions of the store in 18 countries, supporting 30 different languages.
  • Nokia's free pedestrian and car navigation software has been downloaded more than 10 million times since it was launched in January. The service is now available for more than 70 countries and in more than 45 languages.
  • Comes With Music, which makes millions of songs available for download at no extra cost for up to a year with the purchase of certain Nokia devices, was recently launched in China and India.
  • Nokia Messaging is supported by more than 70 operators.
  • Ovi Mail has registered 8 million subscriptions. That's a rate of about 1 million subscribers a month.
  • Nokia Life Tools is providing people in India and Indonesia with agricultural information, educational services and entertainment. In less than a year, it has attracted more than 1.5 million paying subscribers, and Kallasvuo announced the service will soon be extended to China.

Kallasvuo said the rapidly growing demand for applications, games and other mobile content is no longer just a Western phenomenon. "It's a global trend that plays to one of Nokia's strengths, our global presence," he said.

Kallasvuo cited the success of a Finnish company, Offscreen Technologies, which makes a variety of mobile applications. People from virtually every country in the world have downloaded Offscreen's apps with Nokia devices more than 25 million times.

In reviewing Nokia's performance in 2009, Kallasvuo noted that the company sold 432 million devices worldwide - more than its top three competitors combined. 2009 marked Nokia's 12th consecutive year as the world's largest manufacturer of mobile devices.

But 2009, Kallasvuo noted, was a difficult year, due to a weak global economy. "The recession coincided with our transformation, as well as changes in our device portfolio. With all these factors together, it resulted in a decrease in operating profit and earnings per share, compared with 2008. Despite the challenging conditions, Nokia continued to maintain strict controls on costs and has maintained a solid financial position," Kallasvuo said.

This year, Nokia is planning to introduce a new generation of devices that is expected to help close the gap with the competition in high-end smartphones, Kallasvuo said.

"Our approach has been to concentrate on fewer, competitive products that bring the features of Symbian-based smartphones to more and more people around the world. And we are well on our way to doing that."

In addition, Nokia is continuously improving the experience and value of Ovi services that are tightly integrated with its devices, creating reasons for people to start using them and to come back again and again.

Kallasvuo expressed optimism about the MeeGo software platform, which will be used for Nokia's next mobile computer.

"We are working hard to reclaim leadership in high-end smartphones and mobile computers." he said. "It is critical that we improve the customer experience with the usability of both our devices and our services."

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