Nokia delivers cheapest ever 3G handset

 

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By Reuters

Posted on 18 May 2009 at 16:10

Nokia has unveiled three new mobile handsets, including the cheapest 3G phone to date from the world's top handset maker.

The new 2730 Classic is expected to retail for 80 euros (£70), excluding taxes and operator subsidies, and go on sale from the third quarter of this year.

Analysts say smaller rivals might sell 3G phones for less, but this is the cheapest model on the market from any top-tier manufacturer.

"The pricing is very, very interesting, especially for operators trying to migrate users to 3G," says Gartner's Carolina Milanesi. "It will make a difference to sales."

Nokia saw its worst ever quarter in January-March, leading the company to report its first ever quarterly pre-tax loss.

Its wide offering has kept it ahead of traditional rivals such as Samsung Electronics, but the Finnish firm has lost market share at the top end of the market to rivals such as Apple and Research in Motion.

"We knew already that Nokia can do affordable devices. What we need to see is what it can do in the high end and how margins are going to develop if it continues to push into the low end," Milanesi says.

Nokia also unveiled the 7020 and 2720 Fold models, which will sell for 90 and 55 euros (£79 and £48), respectively.

The new 3G handset, with Nokia's traditional candybar design, is targeted at entry-level pre-pay users in both developing and developed markets.

"Mobile operators worldwide are crying out for more low-cost 3G handsets which enable them to reduce their expensive subsidy budgets and target high-volume mass-market consumers," says Strategy Analytics analyst Neil Mawston.

"Entry-level consumers in regions such as Asia and Africa will make up the next major wave of growth for the 3G handset industry and the 2730 Classic helps to address that segment," he adds.