

But some of the countries are relatively small markets




Lumia 520
The Lumia 520 [Image Source: Nokia]



Source: Microsoft [TechNet]

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By zilexa on 3/28/2013 5:54:28 AM , Rating: 2
Mike, clearly you enjoyed US education and didn't learn anything about European demographics. Eastern Europe is a huge area where hundreds of million people are living. They are currently starting to switch to smartphones. Becoming the no.1 in these countries might be easy by releasing cheap phones, but its still huge. And together with European Russia (thats alone 110million people) you are looking at 40-50% of the European population.

Take that into account.. plus the fact that UK, France, Germany, Holland, are all completely saturated markets with very little movement (everyone already has a very good smartphone), eastern Europe should be the target of any new player in the mobile segment.

So this is not about WP versus iOS, this is about the success of a new player.. and it would be more interesting to compare with Android since iOS is a small player there and becoming smaller in Western Europe.



By 91TTZ on 3/28/2013 10:51:57 AM , Rating: 3

The problem for a manufacturer is this: You have to sell the phone for a loss in developing countries in order for it to be cheap enough for them to buy it. Then you need to hope that those customers stay with you when they get enough money to buy a more expensive (and profitable) phone. Historically, customers do not have that kind of loyalty and begin buying luxury items as soon as they can afford them. Once people in second and third world countries get the money, they don't buy new Ladas and Tatas, they buy Mercedes and BMWs to show off their newfound wealth.

By MadMan007 on 3/29/2013 1:16:27 AM , Rating: 2
What evidence do you have of phones being sold for a loss? (Obviously talking about net loss not talking about subsidies here.)

By 91TTZ on 4/1/2013 2:23:45 PM , Rating: 2

Apple held 69 percent of handset profits earned in all of 2012, more than double that of the South Korean Samsung, which hauled in 34 percent of phone profits last year, according to Canaccord Genuity… By comparison, Nokia dropped to -2 percent of handset profits in 2012. The Finnish cell phone pioneer saw its profits flatline during the fourth quarter. Meanwhile, Motorola and Sony handset profits were much better, along with LG ending the year with -1 percent. Although it ended the year as the third most-profitable handset maker, HTC struggled to post a profit of just 1 percent. In other words, Apple was 69 times more profitable.

So you see that the third place finisher had a profit of just 1%. And even that was good for them. The future is looking worse:

The Taiwanese mobile handset maker, HTC, showed the extent of the squeeze it is suffering from South Korean rival Samsung as it warned first-quarter revenues could fall 17% compared to the last three months of 2012, and operating profit margins could drop almost to zero. Profits for the fourth quarter had crashed by 90% year on year to just NT$600m (£12m) on revenues of NT$60bn, down 40%, the company said as it unveiled its annual results.

So to sum it up, if you're not Apple or Samsung you most likely sold phones for a loss. If you're HTC, you eeked by with a 1% profit but those profits have since fallen 90%.




