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Nokia Sets Sights on Developing World

April 19, 2011

For many people in poor countries, their next mobile device will be their first—and it’s likely to be made by Nokia. The Finnish company, which ships more phones globally than any competitor, leads rivals in global sales of both smart phones and less powerful, less profitable “feature” phones. A key part of its strategy is to build new devices and services tailored to markets with minimal infrastructure.

Text tools: Nokia’s Ovi Life Tools include SMS-based educational apps like the one this boy is using.

Today, Nokia’s share of the fast-growing, high-margin smart-phone market is shrinking as iPhone-like handsets take over. Sales of feature phones are roughly flat worldwide but are still growing fast in poor regions, particularly the Middle East and Africa. To tackle these markets and reach people who have never owned a phone before, Nokia is now designing products specifically for particular social and cultural needs.

“These devices necessarily have to be less complex than those in the developed world,” says Henry Tirri, who leads Nokia’s research efforts. “But they can still serve the same hunger that we have for our latest devices—needs like socializing and entertainment.”

The X1-00 phone is the latest result of Nokia’s attempts to strike a balance between stripped-down, practical devices and objects of desire. The handset has a battery that lasts for 61 days on standby, a useful feature where electricity supplies are unreliable. An integrated speaker significantly louder than any on U.S. smart phones can blast out not only MP3 files but also FM radio, a major source of entertainment in parts of the developing world.

Nokia’s product development is guided partly by ethnographic research that examines “market structures, livelihood activities, cultural practices, and how they operate in concert—and where a new thing like the mobile phone fits into that,” says Jenna Burrell, an assistant professor at the school of information at the University of California, Berkeley. She found during her own research in Uganda that local people most valued mobile phones because they helped them avoid traveling, which in turn saved them time and money. Nokia researchers are also working on SMS-based services similar to Internet apps and services. A Nokia service called Ovi Life Tools—available in India, China, Nigeria, and Indonesia—allows users to subscribe to SMS updates on topics like agriculture and sports. Another, Mobile Communities, lets them share text messages in groups, and send and receive Twitter-like updates.