Nokia to pull out of Japanese market

HELSINKI —

Nokia, the world’s leading mobile phone maker, said on Thursday it would stop selling and marketing its mobile devices in Japan because its market share there remained below expectations.

“In the current global economic climate, we have concluded that the continuation of our investment in Japan-specific product variants is no longer sustainable,” Timo Ihamuotila, executive vice president at Nokia, said in a statement.

However, sales of the Vertu luxury mobile phones, a brand owned by Nokia, will continue in Japan, the Finnish company said. Its global research and development as well as sourcing operations in Japan will also continue.

“In Japan we have had a low market share, below our own targets also. We have been investing in the market for a long time, but we are still in that situation,” Thomas Joensson, communications executive vice president, said.

He added the company continued to believe its exclusive Vertu brand would succeed in the Japanese niche market segment despite the global financial turmoil.

Vertu makes expensive handsets that are often embellished with titanium, gold, jewels and crystal.

In October, Nokia said it estimated its global market share in July-September was 38%. The Finnish firm has done very well in emerging markets such as China and India, but has failed to attract technology savvy Japanese consumers.

Handsets designed by foreign manufacturers have traditionally been unpopular among Japan’s notoriously finicky consumers.

The country’s top mobile operator NTT DoCoMo and number three Softbank Mobile sell Nokia handsets, but the Finnish giant’s market share is limited.

Many consumers are accustomed to Japanese-made mobile telephones, which are also widely used as electronic wallets, train tickets, and even to watch television.

Japan’s mobile phone market has developed differently than those in other countries, with mobile operators, rather than handset makers, developing software and services.

The Yomiuri newspaper reported last week that Nokia planned to launch its own mobile phone service in Japan in February initially for Vertu handsets.

Kyodo News said Nokia was considering starting a mobile phone service as a virtual network operator, using communication lines owned by NTT Docomo.

Nokia will boost its sales network in Japan and present its own price plans for the mobile telephone services, the report said. 

Wire reports

  • 0

    taiko666

    electronic wallets, train tickets, and even to watch television

    Nokia has this technology and uses it in other markets. Technology is not the problem (especially since the mainly Nokia-owned Symbian OS powers many of the leading Japanese smartphones.) So there must be other reasons why Nokia was unable to provide these particular features (which require close co-operation with relevant Japanese companies and authorities) in Japan.

  • 0

    sydenham

    My friend asked me to try to help him set up his Nokia phone this past summer, and after a go with it I couldn't believe he had paid money for that thing. Granted, he just wanted a basic model, but it felt like a kids toy, the quality was so crap. The organization of screens, programs and file folders just didn't make any sense to me at all either. Also, even with an English instruction booklet, it was harder to set up than my present Sony FOMA was, using an instruction booklet written only in Japanese.

    I've used the Motorolla Razor, and an older Motorolla model, as well as a basic Samsung thingy, a couple of Panasonics, and a really really base model Sharp (10 years ago), all of which were heaps better than this Nokia was, both in terms of feel/body construction and ease-of-use.

    Test runs with Palms, Blackberry's and iPhones have always been smooth too.

    My experiences are only anecdotal, but I'd say that my only go with a Nokia phone turned me off them 100%. They always look so sh*t-hot in movies, and maybe I was expecting a little too much.

  • 0

    dennis0bauer

    Europian phones lack a lot of things that are standard in japanese mobile phones

  • 0

    Rodney_King

    Nokia, maker of ugly phones to pull out of Japanese market

    I still can't believe they tried to sell those ugly foreign phones here. Big, ugly, and a horrible LCD screen, even some TV remote controller have better LCD screen. Even japanese kids phones have more fonctions than the high-end model from Nokia

    @taiko666

    They may have that technology but we all know where they spied it....come on J-Phone was the first company who sold cellphone with camera and Nokia was still making non-colored LCD screen....only displaying phone number.

  • 0

    rgetty

    Rodney King the Japanese had the cell phone with the camera because the French guy that invented it was given a bunch of cash to be partners with a J-company so they could be the first to have it out and say Hey look at how advanced we are! Anyone that knows anything knows that Japanese companies come up with very little.

  • 0

    GW

    so did Jpn do to nokia what they did to motorola in the early 90s.......

  • 0

    NeoJamal

    It took a while for Nokia to realise that open faced bricks don't sell in Japan didn't it? Nokia should've quit the J-CDMA market along with Vodafone years ago.

  • 0

    haytkayokomiya

    You can't compete with Japanese phones.

  • 0

    zaichik

    Weren't they saying just the other day that Nokia was going to increase it's presence in Japan?

  • 0

    Zaidou86

    No european cellphone maker can't compete with japanese cellphone makers? The main reasons are features needed in Japanese market. It inclued the ability to use the cellphone as an electronique wallet, a build-in 1seg TV, and emoticons in emails. And japanese cellphone carriers have a strong business model to meet customers needs. They make sure that their offering grow with customers evolving needs. In France, carrier sell services only.
    Jaunay-Clan, France.

  • 0

    some14some

    Weren't they saying just the other day that Nokia was going to increase it's presence in Japan?

    Yes, they did. and my comment was Nokia will enter and exit fron Japan market unnoticed. Very hard for foreign companies to face govt controlled NTT, but Nokia is enjoying good business in big countries like India and China.

  • 0

    Rodney_King

    Very hard for foreign companies to face govt controlled NTT

    Please! NTT is a carrier and Nokia a phone maker. Don't compare oranges and apples. Nokia had his chances, their phones were included in collections from Docomo and Vodafone and then by Softbank (see ? their phones were in 2 of 3 japanese carriers catalogs) but they were just not attractives, they were just hugly and with limited technology. Consumers just did not buy them, that's all. They did not like them. If consumers don't buy them don't blame the carrier or the market or the consumers. If a european TV maker tries to sell its TV's sets in Japan but decide to pull out from japanese market will you blame "govt controlled" NHK or the japanese TV channels for their poor programs ?

  • 0

    Thenewfront

    foreign firms rarely suceed here, due to xenaphobia. How many negative things cand the media say about foreign copmpanies and products etc?

    Samsung have even pulled out of Japan for their TV's.

    Buying a NOkia phone would be seen as buying, inferior, just because it is foreign.

    Only a few foreign companies can survive in Japan.

  • 0

    PepinGalarga

    Nokia's phone's just dont have the abundance of features that the Japanese phones have. I totally agree with sydenham. I have used Nokia phones before, and they are incredibly user-unfriendly.

  • 0

    DerekTrotter

    Samsaung flat screen Tv's, top sellers worldwide, Nokia, best sellers worldwide, not available in Japan. Xenaphobic remarks by J media, not inferior products. Foreign companies that will succeed without joint ventures are usually high end fashion outlets that take advantage of the Japanese obsession with material goods.

  • 0

    HaroldSteptoe

    Mr Trotter is in fact correct in his analysis. Japan promots products daily through newspapers and Tv, thsi will invariably be japanese products.

    Gawd, i remember the media, everyone one of which said Costco was doomed to fail as Japanese do not like being members of stores.

    Nokia has to leave, but some companies can ride the storm of crticism. If Nokia, Samsung, LG and many beers for example are good enough to be world beaters, no1 worldwide, then why do so many fail in Japan?

    Nokia pulled out due to bad press, it must get on their nerves, only some like Microsoft (XBOX360) will perserver. Don't kid yourself foreign products have the same playing field as Japanese.

  • 0

    HaroldSteptoe

    If Nokia were to agree to "share" their technology with Japanese firms they would not be leaving.

    BTW, anyone consider the low success worldwide of japanese phones if they are so "superior" in every way?

  • 0

    GeorgeRoper

    I got a Nokia from Mildred fromChristmas last year, it's brilliant.

    Strewth, the Japanese are losing out on good phones.

  • 0

    xpompey8

    Less than a week ago there was an article entitled, "Nokia to launch mobile phone service in Japan next spring". Is this a 180 turnaround within one week?

  • 0

    NeoJamal

    BTW, anyone consider the low success worldwide of japanese phones if they are so "superior" in every way?

    Why are plasma screens not popular with primitive Amazonian tribes?

  • 0

    jonnyboy

    i was initially impressed with my first keitai 5 years ago, but in the intervening years i've come to see them as terribly user unfriendly with ugly text menu after text menu. i crave some icons and a well thought out interface. perhaps i should get an iphone

  • 0

    HaroldSteptoe

    NeoJamal-How funny, aren't you a card? I'll make it simnpler. If Japanese manufacturwed such greta phones why are the not popular outside of Japan? Nokia and samsung are better tahn japanese phones by a mile, oh and Motorola.

  • 0

    taiko666

    You can't compete with Japanese phones

    A large percentage of these 'Japanese' smartphones use the Symbian OS from the UK, 70% owned by Nokia. The 'engines' of these phones, which actually enables them to do things, are actually created in London. The cutesey factor, and place on which to hang a doohickey, are created in Japan.

    I think Nokia found it hard to 1) strike deals with Japanese stakeholders in order to provide electronic cash services etc (I suspect being foreign didn't help things) 2) convince the Japanese public to accept something 'different'; 3) convice Softbank and Docomo to actually attempt to sell the Nokia phones they were stocking; 4) realise that in Japan it doesn't matter if your phone blows away the opposition in terms of power and capabilties- if it doesn't look cute, and Japanese, the public aren't going to be interested.

    Nokia are now going to sell the Vertu, which is basically a fashion accessory phone which can do the basics. Thus I think they've finally understood the Japanese phone-buying public's mindset.

  • 0

    HaroldSteptoe

    taiko666- Couldn't agree with you more. Oh yes, japanese technology is over rated. japanese phones are rarely seen outside of japan, due to poor quality.

    Nokia and other foreign firms face obstacles at every turn, gawd, Japanese phones are rubbish compared to froeign one.

  • 0

    Badsey

    My Nokia was a great phone, great audio, very good signal quality. Hard to get it to sync with computer, hard to understand file placement, came with many programs, optional full size computer keyboard etc.

    Apple iPhone: less signal quality, audio less, more user friendly. Internet way better. Wifi works well.

    Nokia is actually the better phone, but with the iPhone you can do more easier. Ease of use is the key to these gadgets.

  • 0

    TheguyNextdoor

    Less than a week ago there was an article entitled, "Nokia to launch mobile phone service in Japan next spring". Is this a 180 turnaround within one week?

    xpompey8

    Launch its own "mobile service", is the difference from what is happening. they are pulling out of having their phones sold by carriers. The service is what is provided by carriers, like docomo, softbank, etc....

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