Nokia wins $2 billion mobile handset orders in China

Nokia, the world's largest mobile phone maker, said on Thursday it had won a $2 billion order to supply mobile handsets to distributors in China.

Espoo, Finland-based Nokia said it had renewed mobile handset contracts worth more than $2 billion with two distributors in China - China PTAC and Telling Telecommunication Holding. Both contracts are worth over $1 billion each, Nokia said in a release.

"China PTAC is expected to purchase mobile devices valued at more than one billion dollars and Telling is expected to purchase mobile devices valued at more than $1 billion from Nokia in 2010," the company said in the statement.

Chinese distributors usually sign such deals once a year with Nokia, but the deal size is lower than last year's and PTAC has downsized the purchase value for the third time in a row.

Last year, the deal size with PTAC was $1.76 billion, while it was around $2 billion in 2008.

Although China is Nokia's key market and accounts for approximately 16 per cent of its global sales, its market share in China has declined from 40 per cent in 2008 to about 35 per cent by the end of 2009.

China is Nokia's third largest sales area having had sales of $8.6 billion in 2009.

Nokia has been losing out in China in the top-end segment to smartphone makers RIM's BlackBerry and Apple's iPhone, while it has been facing increasing competition from Samsung, Motorola and local manufacturers in the mid and lower segments.