Nokia eyes 3G, rural market with new phone models

With third generation mobile services finally coming to India, Nokia, the world's largest mobile phone maker and the largest multinational in India in terms of sales, is set to introduce a number of new handset models which are more than just phones. They will support a number of new services like music online and other location-based functions.

"We are moving away from just devices to devices plus services plus solutions. With the 3G mobile services set to spread by the middle of next year, we feel that revenue from non-voice services is bound to increase significantly," Nokia India Ltd vice-president and general manager D Shivakumar told reporters in Chennai on Wednesday.

Asked whether the Finland-based company is planning to acquire any content provider to enhance services, Shivakumar said while the company had no acquisition plans, it would create ''collaborations with the innovators". Nokia has already called upon Indian mobile and web application developers to create innovative consumer applications exclusively for the upcoming handset N97.

Shivkumar added that there would be significant investment in ramping up manufacturing facilities. The company has already invested $285 million in its Chennai plant, and says it is investing in all parts of the value chain, including putting more money into Indian Premier League cricket and its retail operations.

Nokia is confident that Indian mobile subscriber growth will continue and not be affected seriously by the ongoing economic slowdown, even though experts and network operators say small and medium enterprises are cutting back on telecom spending. "If you look at COAI numbers, telecom should be better off this year," Shivakumar said.

That apart, Nokia is keenly watching the 3G mobile space where the auction of licenses has been deferred for the time being. The company has an impressive 3G handset range, but Shivkumar said that the Indian 3G market will be very different from the rest of the world. "Data alone will not work in India. 3G in India will be led by entertainment and will depend on pricing," he said.

Rural focus
Moreover, with the urban market for handsets fast getting saturated, Nokia plans to tap the growing rural market in collaboration with various microfinance institutions. Shivakumar said India has about 249 million urban subscribers and 93 million rural subscribers. These represent 81 per cent and 12 per cent of the market respectively. The national mobile penetration is 31 per cent.

For a start, Nokia has tied up with SKS Microfinance, which has 653 branches across 15 states. Apart from this, Nokia tries to reach into rural areas with 'showrooms on wheels' and 'rural care on the go'- marketing and servicing vehicles, respectively.

Nokia officials and other speakers on the occasion noted that about 150 million customers would be added to the customer base in the next two years, of which a large number would come from rural India.

The company will also soon launch 'Nokia life tools, which it describes as ''a range of agriculture, education and entertainment services designed especially for the consumers in small towns and rural areas of the emerging markets.'' The pan-India roll-out of this is expected by June.