Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) has been struggling to regain market share, and the company’s Windows phones are supposed to be its ticket out of the poorhouse. While some analysts have not been happy with the company’s sales so far this year, a medium to long-term approach may be necessary when considering whether Nokia will make it.
While market share is important for all handset makers, it’s important to realize how Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) and its competitors (specifically Apple) are positioned. Developed markets are now heavily saturated with smartphones, so if handset makers are looking for growth, they won’t find it there.
However, emerging markets like China will play an important role in the future of companies like Nokia. In fact, research indicates that the market for low-end smartphones will likely triple within the next few years. Nokia has the ideal position to address this market and take full advantage of it. Meanwhile Apple Inc. (NASDAQ:AAPL) is stuck on the side lines until it can get a low-end iPhone out to compete with Nokia for the only part of the smartphone market that’s truly growing.
Nokia actually hit a major milestone in China earlier this month, noting the activation of two million Lumia handsets in the country. That is a big deal for the company because it shows that it has a chance at growing in emerging markets.
Nokia is pushing into these developing markets with great speed. Early sellouts of the Lumia handsets were reported in the Middle East and Asia, indicating a strong reception in developing markets. In Shanghai, the Lumia 920 sold out in just 20 minutes. In addition, Nokia then launched an even less expensive handset at this year’s Mobile World to delve further into these developing mar.
And then there’s the fact that Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) has brought a major player into the game with it: Microsoft. One thing that should be noted about Microsoft Corporation (NASDAQ:MSFT) is the fact that the company has never been worried about getting into a specific market first.
The company works methodically toward a goal and comes out with a success story eventually. Microsoft Corporation (NASDAQ:MSFT)’s investors can count on the stock always rebounding in the long run because it holds the lion’s share of the business desktop and software markets and because it works steadily to create great products, even if they aren’t first. There’s certainly something to be said about biding your time until you can develop a product that’s not only great, but that will also remain relevant for years to come.
Shares of Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) are up 1 percent in Tuesday morning trading at the New York Stock Exchange.