By Jimmie Geddes email: firstname.lastname@example.org | Feb 23, 2013 01:58 PM EST
Nokia is preparing to launch a new approach in its quest to regain some of the market share it has lost over the last few years. The company is planning to target the low-end market with a lower-priced Lumia Windows Phone 8 smartphone and basic feature phones, which it is expected to showcase at Mobile World Congress (MWC) 2013 next week.
When Nokia decided to drop its Symbian smartphone OS in favor of Microsoft's Windows Phone OS, it knew it would be facing an uphill battle to reclaim the days when it was the top selling smartphone maker. The battle is taking longer than Nokia had anticipated and it has been receiving pressure from investors because its cash is dwindling and it can't afford too many more quarters before it needs to change its focus.
Nokia is obviously listening to investors as the smartphone maker is expected to unveil a more affordable Lumia smartphone on Monday at the Mobile World Congress (MWC) convention in Barcelona. Sources have told Reuters that Nokia will also introduce "cut-price basic phones" to compete with ZTE, Huawei, and other manufacturers who make basic feature phones. Nokia apparently has decided to focus on the low-end since it hasn't seen the kind of success it andthe investors were hoping for with its Lumia Windows Phones. Nokia is also currently losing more and more market share with each passing quarter in the low-end market, which now makes up the bulk of its sales of mobile phones.
Hakan Wranne, an analyst with Swedbank told Reuters: "What they have to do is increase share in the growing smartphone part and also defend market share in the other."
According to Wranne, a lower-priced Lumia would help Nokia boost its mid-tier offering. "In order to not continue to lose share in the overall market Nokia has to put forward competitive low-end smartphones," he said.
Nokia only sold 4.4 million Lumia smartphones in the fourth quarter of 2012 and analysts believe that Nokia needs to somehow more than double sales and offer lower-priced smartphones and feature phones in order to convince investors that its Windows Phone smartphone strategy is working and that it can survive as a company. It's unclear if this new strategy will actually pay off or whether Nokia might have to consider adding Android to its lineup in order to offer smartphone users with a choice of OS instead of the Windows-only approach.