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Nokia positioning for smartphone growth

Nokia is looking to position itself strategically for smartphone growth in SA. It’s signed an agreement with Microsoft to get the Windows operating system onto Nokia handsets and smartphones, like the N8, available on some seriously cheap contracts.

Having just got an N8 on contract, some things about Nokia’s strategy started to fall into place in my mind when it comes to where Nokia is going.

My current experience:
I have to say that I haven’t been overly impressed with this phone specifically. When I tested the phone for review I was pretty happy although still think other smartphones are better. To quote the review: “So what’s new? To be brutally honest, apart from the multimedia options … nothing when compared to other smartphones. Blackberry, iPhone, Android etc are just better in almost every respect apart from the camera and music.”

So why did I buy it? Well the music and the FM transmitter are top of the list. This way, I can download almost any music I want and have it in my car or on the PC. And with ADSL, albums cost a few rand to download.

But buying the phone was not such a happy experience. Firstly, getting the phone from MTN proved to a serious mission as their stock management is really poor.

Then when I got it, the phone would automatically connect to the internet for no reason and would just reboot at will.

A software upgrade seems to have sorted the internet issue out and the phone has hung a few times and rebooted once, but it is better.

And Nokia has not only provided this awesome music deal but their Ovi store provides an increasing number of apps for download including some really cool kids games and movies that will keep your kids entertained in the car or shops. Again, watch the download sizes.

The strategy
You have to hand it to Nokia, it’s made some good moves around its smartphones. The Nokia N8 “Comes with Music” deal, which has been mostly canned is really pretty good. Cellphone music lovers should look to capitalise on the deal while it is still around.

Right now you get six months to download as much music as you want. And you’re going to need it too because their servers are really slow and you have to download through their Ovi player.

But it’s a clever strategy from an operator’s perspective because with tracks averaging about 6MB each, a 12-track album will be about 72MB to download. If people don’t have ADSL access, that’s a lot of data, and if a lot of users download through the mobile networks, it’s money for jam.

Then Nokia’s Ovi store is also really strategic because you can pay with your cellphone bill or prepaid airtime. So if you see an app you like, you just click and pay for it, no credit card required.

And again, apps are often several MB each, so the more people download, the more the operator makes money.

Which is why having smartphones on as many contracts as possible makes sense and that’s exactly what MTN has done with Nokia as I could have got my N8 for R189 with R100 airtime. I decided to go with the R220 option a month, which gave me R200 worth of airtime.

This really highlights how much the networks are subsidising phones to get people to use more data. The N8 is retailing for about R4 200 and upwards. On a 24-month contract, MTN is giving me R200 a month, which shows they’re not going to make anything back on the phone. But if I download lots of stuff, well then my spend goes up and that’s the strategy — increasing average revenue per user.

Being Smart
It’s a great way for mobile companies to make money off you, but you still get a great phone, whether you’re getting an Android phone, iPhone, Nokia etc.

So here are some tips to reduce your costs.

*Use ADSL wherever possible through a wireless connection on your phone. Save serious downloads for when you are on ADSL.
*Install an instant messaging client like WhatsApp or Nimbuzz.
*The latter lets you chat to someone on a PC through Google Talk or MSN which is really handy. Skype is an option as well. This cuts down on SMS costs.
*Switch off all apps that connect to the net automatically like Facebook and Twitter and only connect to services when you need them.
*Don’t download your email, set up a Google account and look at your mail through a browser.
*Use a browser like Opera Mini on your smartphone to reduce browsing costs.
*Get a data bundle for when you can’t use ADSL.

And lastly, to all the BlackBerry fans out there. It’s NOT free. It costs you every month. No you don’t have to worry about cost but with the above strategy you wouldn’t really have to worry about cost either.