Reports in Reuters, Bloomberg, and other outlets indicate Finland’s Nokia is cutting European prices on selected smartphone models by as much as 15 percent in bolster flagging sales. The price cuts—which apparently apply to the company’s N8, C7, and E6 models—are no doubt aimed to help the struggling Nokia sustain unit shipments as it prepares to launch its first Windows Phone devices later this year—but industry watchers note that it could also start a pricing war.
Nokia did not immediately return a request for comment, but company representatives have been quoted in other outlets, describing the price changes as part of the company’s routine operation, with the only exception being that these cuts were model-specific rather than across an entire product line.
Nokia is still the world’s largest mobile handset manufacturer, but a lot of the company’s sales volume comes from entry level phones and devices targeting emerging markets. The company has largely missed the boat on consumer’s eager adoption of smartphones, with Apple and Android now dominating the consumer smartphone market. In February, newly-installed CEO Stephen Elop announced a bold all-or-nothing strategy shift that is seeing Nokia abandoning its long-standing Symbian operating system and the nascent MeeGo platform in favor of Microsoft’s still-struggling Windows Phone platform. Nokia’s first Windows Phone devices are due later this year; in the meantime, the company is still trying to peddle its existing Symbian-based product line.
By reducing pricing in its existing smartphone products, Nokia is lowering the risk mobile carriers take in offering the products, and making the phones more appealing to cost-conscious consumers. And the move may help—although Nokia is a non-player in the North American smartphone market, the company has retained significant market share in Europe.
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