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August 11, 2006

Nokia bound for Seattle/U.S.

Posted by Tricia Duryee at 2:16 PM

In February, I braved the cold Finnish winter to visit Nokia, the largest cell phone manufacturer in the world.

What I learned was that it's a dry cold, so it's not that bad.

No, but seriously, I learned that Nokia executives were gearing up for an offensive on the U.S. For the last couple of years, Nokia's market share has been trailing in the U.S. behind Motorola's. As part of the attack, they said they were looking to partner with companies here, and more specifically companies on the West Coast, where they see a lot of mobile innovation occurring.

Nothing more clearly demonstrates that promise than its $60 million purchase earlier this week of Seattle-based Loudeye. In a letter to Loudeye employees, we reported that Nokia may use Loudeye's expertise to launch a Nokia-branded music service. But more interesting, it also said it may decide to use Seattle as a base for expanding its services into the U.S.

From what they told me, that's a definite possibility. They already have an office in the Factoria area that mostly serves T-Mobile. Perhaps they will want to have a development office, as well? Why not -- the area is undeniably a hotbed of wireless expertise. Also, in recent months, Nokia has also formed partnerships with RadioFrame Networks and Sotto Wireless, both of Bellevue.

A Wall Street Journal story yesterday outlined other steps the company will take.

It said that Nokia's new Chief Executive Olli-Pekka Kallasvuo plans to spend one week out of every month in the U.S. As he said, to win back Nokia's marketshare, "there is no magic bullet. It's hard work."

The story also explained that Nokia will expand its handsets to include styles that are popular with U.S. consumers. (It lost share when flip-phones like Motorola's Razr became more popular than Nokia's candybar style phones.) Nokia will also work to launch new phone models simultaneously in the U.S. and elsewhere -- often before there was a lag of several months before they reached Americans.

Perhaps the next time I meet with Nokia executives, it will be here -- in Seattle. That would be a little less cold, but a lot less exotic.

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Tricia Duryee
Tricia Duryee
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Angel Gonzalez
Angel Gonzalez
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Kristi Heim
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