Nokia seeks to reclaim U.S.

Chicago Tribune reports that Nokia is trying to reclaim the top spot in the U.S. after losing ground to Motorola the past few years. Neil Mawston at Strategy Analytics said, "North America is where their biggest weakness has been over the past few years. Nokia has more or less lost half of its market share in the past five years."

Nokia has made some modest progress, but as Ed Snyder at Charter Equity Research said, "Motorola is going to have to screw up for Nokia to catch them in the U.S." Can it happen? It did in the late 90s, the last time Motorola ruled the roost before stumbling and opening the door for Nokia to become number 1 in the U.S.

Of course reciprocated and gave the lead back to Motorola. Mawston said, "There was no single major issue for Nokia. I think they felt the candy-bar phone would conquer all. It was a pride thing."

Neil Strother at NPD Group said, "Nokia thought, [The clamshell] can't be worth it. They just took a gamble and hoped it would be a fad."

In addition to handsets, Nokia was known for not working with the network operators to customize handsets for their customer base.

Nokia is making strides to turn things around, and the company's recent joint venture with Sanyo to tackle the U.S. CDMA market, which is half of the overall U.S. market. John Jackson at Yankee Group said that meant Nokia "effectively doesn't compete in 50 percent of the U.S. market. I don't expect to see any tangible results from that partnership for at least 18 to 24 months, and even then I don't think there's any assurance.""

According to IDC, "Nokia ranked sixth in the U.S. CDMA market during 2005's third quarter, with a 7.6 percent share, while Sanyo was fourth, with 11.3 percent. Sanyo is strong at Sprint, where Nokia and Motorola are weak."

Charter Equity's Snyder opined the joint venture was "an admission from Nokia that CDMA has basically been an expensive flop, and that the company doesn't see it as a high-growth area." He said, "They've given up."