Under pressure, Nokia faces stiff competition in emerging markets

Nokia has released a range of cheap as chips Asha smartphones as it aims to regain market share in emerging regions with new low end handsets.

Three models have been released by the Finnish former rubber boot maker, the 305, 306 and 311, all aimed at providing touchscreen functionality and web access at low prices as Nokia target the “next billion” smartphone users.  

The three devices will be very light on the pocket with estimated retail prices to be around €63 for the Asha 305, €68 for the 306, and €92 for the 311.  

Not surprisingly features are as basic as can be expected for such low prices, but all give access to 3G networks and social networking.  The 306 is also Nokia’s cheapest WiFi enabled phone to date.

The slightly pricier 311 meanwhile has a 1GHz processor, a 3.2 megapixel camera, and preloaded Angry Birds for that extra mainstream appeal.

Nokia has been under intense pressure recently as its sales dwindle, while Samsung takes its crown as the biggest phone seller.  

In emerging markets Nokia has been struggling too, with cheaper Android based smartphones hurting profits and helping send the firm on a downward spiral.  

With its credit rating slashed recently to ‘junk’ rating, and its cash reserves in threat of being depleted, the company is under pressure to act fast to return to form.

The Finnish firm will be hoping that the release of its cheap Asha handsets can go some way to regaining lost market share, particularly in emerging regions. Nokia will have its work cut out for it as the low end phone landscape continues to get increasingly competitive, despite it once being a stronghold for the firm in its heyday.

Among others Intel has also thrown its hat into the ring recently, announcing the relatively cheap Xolo phone in India, alongside a Lenovo produced handset in China.  

Coupled with the intense competition Nokia already dealing with, the firm certainly has a fight on its hands. 

“A slide in both shipments and sales numbers of entry-level devices reflect the fight that Nokia has on its hands keeping hold of a lucrative demographic that has bought billions of S40 phones in the past,” Ernest Doku, mobile expert at uSwtich, told TechEye

“In a challenging smartphone landscape, Nokia’s enduring strength in the developing markets remains its strong suit,” he said. “These new Asha devices cement this as being its key area to drive serious volumes. 

“However, Nokia is well aware that it cannot rely on these buyers forever. As the markets have begun to mature, consumers have equally become more demanding of their smartphones.”

For Nokia it is imperative that it can provide good quality when offering higher end specs at low prices, or risk losing out on lucrative emerging markets. 

“If it can make good on the promise of a high-end experience at these kinds of prices,” Doku said, “Nokia could well be poised to retain a tight grip on these essential emerging markets.”