NOKIA SHOCK

Nokia Shock

Nokia Shock

Introduction

Mobile phone has become a need of every individual living any corner of this world from North America to Asia and Africa to Australia (Jeffrey & Doron, 2012). No doubt, rapidly changing business and technological environment played a significant role in changing the number of mobile users all over the world. In fact, it can be seen that more than 2 billion people use mobile phones as their way to communicate with others. This also means that there is an intense competition among the mobile phone manufacturers in different regions of the world. The current market situation shows that companies like Nokia, Motorola and Sony Ericsson are now facing tough competition from new comers of mobile phone market like Apple, Samsung and HTC (Bremmen, 2012).

Currently, Nokia is investing enough to bring more innovative products such as 'Asha' in the global market that can be seen as a big hope for the company to gain its market dominancy (Forbes.Com, 2012). In addition, India is a country that has world's third large population who are potential customers for any international business. Nokia is maintaining its competitive position not only in India but also in other South Asian markets like Pakistan and Bangladesh where population is also huge and the income level is also high. This means, Nokia needs to understand the environment of this industry and the mobile phone market of India (Forbes.Com, 2012). In addition, it is also equally important for the company to understand the pace of growth of Indian mobile handset market and consider the region as an emerging market for its products (Tharoor, 2007). This paper aims to analyse the environment of the Indian mobile phone/handset industry and provide a strategic direction for the company to grow with its products in this market.

Discussion

Environmental Analysis of Mobile Phone Industry

No doubt, use of mobile phones has reached saturation levels or maturity in most developed countries. In other words it can be said that mobile markets in Western Europe and North America are matured. However it is also a fact that a significant growth has been seen in the number of subscribers in developing countries like China, India, Eastern Europe, Latin America and Africa (Crawford, 2012). The global mobile phone market grew 19.8% in the first quarter of 2011, a total of 371,800 million units sold compared to 310,500 during the same period in 2010. In addition, IDC explains in its Worldwide Mobile Phone Tracker report that the global market for mobile phones and smart-phones recorded a significant annual growth in the fourth quarter too with 427.4 million handsets sold (Watkins et al. 2012). In fact, this report highlights the rise of smart-phones and more innovative normal handsets as the main drivers of this strong momentum, especially in emerging markets of Asia and Latin America.

The current trends also reveal that manufacturers are developing low-cost terminals that have helped the spectacular growth of this market. Particularly noteworthy are the consultancy devices given by HTC, which has increased its sales ...