Nokia to cull smartphone range

Paul Nesbitt

Nokia plans to halve its range of smartphones in 2010 to cut costs and put more focus on its remaining high-end handsets

Nokia, the world's largest vendor of mobile phones, is preparing to kill off half of its smartphone range in an attempt to cut costs and better focus its R&D resources on fewer products.

Nokia, which still has a 35% global share of the smartphone market, blamed 'really fierce competition' for its new strategy. Nokia still leads the market, but its share has slumped from 41% just a few months ago.

The move means Nokia will likely focus more on ground-breaking smartphones like the critically acclaimed Nokia N900 - with the new Maemo OS - and less on rolling out multiple iterations of older Symbian handsets.

Apple and RIM have snatched market share from Nokia in the smartphone market at the high end, which also faces increasing competition in the low end mobile market as prices slump.

During 2009, Nokia launched around 20 new smartphones. Next year, the company's releases will be closer to 10.

'Nokia's phone selection includes too many models that look and feel the same, and we believe this dizzying array of choices confuses consumers,' MKM Partners analyst, Pablo Perez-Fernandez, told Reuters.

By contrast, Apple sells just one handset, the iPhone.

'Simplicity is always best, so, cutting the number of models while improving the rest of the portfolio is a sensible move,' he added.

'We see really fierce competition certainly in the high end, but we also see it in the mid to low end of smartphones increasing, said Nokia smartphone boss, Jo Harlow.

Nokia CEO Olli-Pekka Kallasvuo said the company intends to drive the prices for smartphones down, while at the same time preserving its margins.