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Nokia: iPhone will lift phone prices

updated 01:40 pm EDT, Mon May 14, 2007

Nokia on iPhone Price

The iPhone could well push the cost of phones upwards in the US, Nokia CFO Rick Simonson said at a summit on Monday. The executive noted that the already high attention given to the Apple device could change attitudes towards smartphones and other media-savvy devices in the US, where cellphone owners are used to less expensive but also more limited handsets -- a feature that could play into the hands of Nokia, whose line is increasingly reliant on costly media and network connections.

"[Americans haven't] had a lot of choice to go out and purchase these kind of higher-end, feature-rich multimedia devices. If that can help that market grow, I think that gives us an opportunity," Simonson claimed.

The Finnish company's financial officer added that its N95 is a key example of a device where many of the features are already comparable to the iPhone. Its slider design includes both physical and onscreen dedicated media playback, a true GPS mapping function, and a 5-megapixel camera. The phone costs $750 but is "something people will pay for" as with Apple's device, Nokia said.

The CFO was careful to note that his company's reaction to the iPhone would likely involve mutual competition. Apple's strategy would validate Nokia but would likely require some change in what Nokia offers. "Don't get me wrong, they will bring some things to the table that we have to be responsive to," he said. "But we have been investing in this area for some time."

Apple will face a relatively uphill struggle with the iPhone in developing its marketshare. Nokia recently said it would hold roughly 36 percent of the world's cellphone business in the spring, which last year amounted to roughly 1 billion phones. The iPhone is expected to reach just one percent of cellphones with a predicted 10 million units sold by the end of 2008.

by MacNN Staff




  1. burger

    Joined: Dec 1969


    Nokia n95

    Just out of curiosity, I had to check the dimensions of the Nokia N95- 99 x 53 x 21 mm

    Jebus, 21mm?!

    To say the iPhone will raise the cost of smart phones is a poor choice of words. The iPhone price is high, I'll give it that, but people seem willing to pay more if they are getting a product that actually delivers on the functionality it advertises. Most of the smart phones on the market are nothing but a headache to work with, IMO. The computer interface is cumbersome and I'm hoping the iPhone will deliver a solution on that front.

  1. Hobeaux

    Joined: Dec 1969


    cost for quality

    i think that the iPod really shows that people will pay more for a higher-valued product. Yes, older MP3 players had more features but they were (and still are) inelegant, unattractive, and limited.

    I hate every cellphone i've ever had, including the one i use now. of course, i always go for the "cheap/free" phone, but when comparing to the more expensive ones I couldn't figure out why i'd want to pay more for the same old thing.

    The iPhone is the first mobile phone that i've actually -wanted- to own and am waiting impatiently to come to market.

    yes, the iPhone is changing the mobile phone landscape, and it's long past time that it should have happened. prices are going to rise, but they had better improve the phones to justify it. simply adding in look-a-like icons doesn't make a generic phone any closer to the iPhone than an old-school mp3 player in a white case makes it an iPod.

    (at the risk of sounding like a fanboy) bring on the competition, but i think it's clear: Apple is changing the world. Again.

  1. fritzair

    Joined: Dec 1969


    Just like the iMac did

    "The iphone will increase the cost of phones". Great statement but really missing a few words. Try this, "The iPhone will increase the cost of phones for cell phone makers". Because the rush to produce something like the Apple product will drain the R&D budget like never before. And then just as they think they have a chance, out comes iPhone2. Hang on for the ride.

  1. UberFu

    Joined: Dec 1969


    anyone remember...

    3 years ago when the RAZR came out ?

    It was [oh wait! Let me think...]$500 when it was released_

    And it had only a fraction of what the iPhone is capable of ?

    [current] Palm Treo 750 --$550 various BlackBerrys --$500-$600

    and yet the iPhone promises to offer so much more for the same price_

    So NO ! the cell phone market will not increase the price of it's cheapest phones_

    Also when the very first iPod came out we got a what ? 5Gb HD for $500 ?

    And now we get a color screen - 80Gb HD - and much more for around $350 [and that's only if you're stupid enough to pay retail for such things]

    Like with everything else Apple the iPhone - too - will decrease in cost slightly thru time and add oodles of more features and functionality_

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