Is Nokia finished in US market?

Greg Sterling on Internet2Go, a unit of San Francisco-based Opus Research that specializes in the mobile internet, has given the latest signal that telco-giant Nokia has fallen heavily out of favour with industry analysts, Businessweek.com reports.

In reference to Nokia's future prospects in the US market, Sterling wrote that you may as well "stick a fork in them". Finnish-based Nokia's share in smartphones has been falling in the face of fierce competition from Apple and BlackBerry-maker Research in Motion. Symbian, the operating system used in Nokia handsets, is also losing shares. Sterling claims that only a radical departure, such as a shift to a new operating system, can rescue Nokia's prospects in North America.

Sterling is just one more in a growing list of professional market analysts claiming Nokia have lost the initiative in smartphones, which now represent the most lucrative part of the telecommunications market. Another sector expert, Richard Windsor, mobile industry specialist at Nomura Securities, argues that it will take until 2011 for Nokia to develop a user interface as good as the iPhone's. Also, for the company to make changes in the underlying software to make it easier for outsiders to write applications for Nokia devices, this will also add to the delay. Bad news for Nokia investors.

There seems to be a degree of disillusionment at Nokia as the company continues to make announcements that are sending it in different directions. However, according to Jack Ewing of Businessweek, with more than double Apple's annual revenue, Nokia can afford to. Already, the distinction between smartphones and mass-market handsets is becoming increasingly unclear as high-end features become commonplace. Despite it being unlikely that Nokia will soon match Apple for usability and design appeal, or separate RIM from its business-class users, Apple cannot match Nokia's R&D resources or its economies of scale.

Nokia would by no means be the first European company to find out that global dominance does not give a company a license to print money in the US, but Nokia has started working alongside US carriers to get its high-end phones into the market.

Ewing points out that, in the future, Nokia may be able to benefit from the greater leeway it gives users to switch carriers or customize their handsets. So, its recovery in the US market might be slow, but it is looking likely.

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