Nokia abandons the Japanese phone market


As Stephen Elop has warned, things are going to get more difficult for Nokia before they get better. Battered by the popularity of smartphones in Japan, Nokia has decided to pull out of the country entirely, reports the AP. Recently, it had tried selling luxury cell phones that cost as much as 20 million yen, or $250,000. Strangely, these efforts were unsuccessful. Apparently, the market for $250,000 phones (running Symbian) is smaller than Nokia anticipated. The Finnish phone maker will pull out completely by the end of July, shutting down its last store in Ginza.

Vertu is a wholly owned subsidiary of Nokia. At one point, Nokia had four luxury Vertu cell phone stores in Japan but the economy and market trends have not been kind. The Apple iPhone has taken off in the region, as have smartphones by Japanese manufacturers like Sharp and Sony. Nokia has declined to state how many phones it has sold in the region.


Nokia’s decision to pull out of Japan may be wise. The company is in the midst of a huge transition, redesigning and rebranding its smartphone portfolio under Microsoft’s Windows Phone operating system. It likely cannot afford to bleed money on expensive luxury retail stores that aren’t holding their own. The problem with phones like these is that today’s luxury phone will look old just as fast as a $600 iPhone, perhaps sooner.

Nokia should be announcing its first devices running WP7 somewhere in the Sept. – Nov. 2011 time frame. And if the company’s first MeeGo phone is any indication (and it is), the lineup might be fairly impressive.

(Images via Luxuo)