Nokia, the world’s largest handset maker yesterday unveiled its first phone running on Linux software with the plan to improve its offerings at the top end of the market. The focus of cell phone business worldwide has shifted to services and software following Apple and Google’s entrances to the market in the last two years.The Finnish firm has been looking for business opportunities from offering services like music downloads or games to cell phone users as the handset market itself is maturing, but to date its offerings have gained limited traction. Nokia has kept its overall market share stable, close to 40%, but it has lost share among more expensive models. High-end products are important for Nokia because the company has not only lost market share there but its average selling prices have declined faster than the industry average. Goldman Sachs expects Nokia’s value share (a measure reflecting average prices as well as underlying market share) for phones costing more than US$350 to decline to 13% this year from 33% just two years before. Savvy observers see Linux as a key for Nokia to gain back ground in the coming years.
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