iPhone may boost high-end mobile demand

Nokia is looking at Apple's market entrance as "opportunity."

Posted by Reuters and Simon Aughton at 9:49AM, Tuesday 15th May 2007

Finnish mobile giant Nokia is optimistic that Apple's highly anticipated iPhone will boost consumer appetite for pricier mobile phones with features such as music and video.
Smartphones that let users to surf the web, take photos, listen to music, watch video and sometimes play games games - in addition to making calls - are often priced above $400, before subsidies by mobile carriers, but Nokia's chief financial officer Rick Simonson is hoping that Apple's market entrance may help stimulate more spending.
"The consumer hasn't had a lot of choice to go out and purchase these kind of higher-end, feature-rich multimedia devices," Simonson said at the Reuters Global Technology, Media and Telecoms Summit.
"If that can help that market grow, I think that gives us an opportunity."
The iPhone is Apple's biggest foray yet into the cut-throat $145 billion consumer electronics industry. Chief executive Steve Jobs has set a goal of selling one million units in calendar 2008.
"Don't get me wrong, they will bring some things to the table that we have to be responsive to, but we have been investing in this area or some time," Simonson said.
"We are leading in multimedia convergence."
Simonson said Nokia, the world's biggest maker of mobile phones, already makes best-selling multimedia handsets - including the N73 and the N95 - that will challenge iPhone when Apple's device debuts in the US in June.
"[The N95] is already out there, doing many of the things that people are talking about the iPhone doing. The iPhone is interesting. It's very much a validation of what we've been doing, in terms of saying there is a multimedia device out there that people will pay for," he said.
Apple has said it could eventually sell 10 million iPhones, a unique combination of touch-screen iPod with video, internet communicator. The version with 4GB of flash memory will cost $499, while the 8GB version will cost $599.
Apple expects to launch it in Europe before the end of the year.