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Nokia Bags Twin Deals in China Worth Over US$2bn

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ESPOO, Finland – Leading handset manufacturer Nokia continues to make deeper inroads in the emerging market of China.

The Finnish manufacturer has been riding on the success of its entry to mid-level handsets in 2009, with China accounting for US$8.6 billion in sales revenue, catapulting the dragon nation to the third position in Nokia’s worldwide sales revenue. Not to be resting on its past laurels, Nokia has finalized two deals with Chinese distributors: China PTAC and Telling Telecommunication Holding Co. Ltd., worth over US$ 1 billion each.

Nokia has been concentrating on developing markets of Asia for over a decade now and China, with its largest mobile market, presents a largely untapped market for the Finnish giant. The manufacturer has been a regular in the Chinese markets over the last couple of years with the previous agreement with PTAC valued at US$1.76 billion in 2009.

Though the sales figures continue to impress, the global economic recession has taken its toll on Nokia’s performance in the Chinese market with the 2010 deal worth US$ 1 billion registering a slip for the third consecutive year. However, the recent agreements have bumped the Nokia shares to EUR11.74 (US$15.66), a rise of 1.8 percent, on the tracks of a firmer Dow Jones Stoxx Technology index.

Though Nokia continues to dominate in the entry to mid-level segment, its smartphone segment stills bleeds, with the handset manufacturer losing share in the segment from 53% in 2007 to 42% in 2009, a sharp decline of 11% in just two years. Nokia’s decline in this segment co-incides with the success of Apple’s iPhone, which has been a huge market success ever since its launch in mid-2007. Rightfully, the Finnish giant has been concentrating on the emerging economies as indicated by the latest agreements with Chinese distributors.

Similar deals in India, the second largest mobile market, where again Nokia has a dominating presence, can be expected over the next couple of months.

[EUR1 = US$1.33399]

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By , Chief International Correspondent on Apr 7th, 2010 GMT +2

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