Photo/Shetuwang

Oct. 17 (NBD) -- Nokia, formerly known as the "king" of the cell phone market, is racing to regain a stronger foothold in China with the release of the X7, which starts at 1,699 yuan (245.9 U.S. dollars).

Nokia's cell phone business is seen well on its way to recovery after being taken over by HMD Global, a Finland-based company jointly established by former Nokia executives and contract manufacturer Foxconn.

It is noticed that HMD's shipments grew a whopping 782 percent in the second quarter of 2018, pushing the Nokia brand to the top 10 both in the global market and China. Due to high price-performance ratio, it has jumped into the top 5 in Germany, the UK, France, Netherlands and Indonesia.

During the past 22 months, Nokia released 24 smartphones globally, many of which were specially designed for Chinese customers, reported news outlet Yicai citing Nestor Xu, vice president of Greater China at HMD Global.

Though the brand’s shipment in the second quarter was encouraging, China remains one of the markets with very fierce competition.

According to a research report, smartphones priced between 1,000 to 1,999 yuan (144.7 to 289.3 U.S. dollars) accounted for over 40 percent of the total number of smartphones sold in China. But 90 percent of the niche segment is dominated by the top 5 vendors, leaving very limited space for medium and small vendors.

Based on Nokia's pricing strategies, most of its products released in China are priced between 1,500 yuan (217.1 U.S. dollars) and 1,999 yuan (289.3 U.S. dollars). In the view of Canalys analyst Jia Mo, it is hard for Nokia to regain the place as a mainstream smartphone brand in China. At the moment, it is more important for Nokia to fatten its customer base through ways including offering more competitive products and strengthening online distribution channels. 

Chinese customers nowadays have too many choices. In addition to exploiting brand loyalty, smartphone vendors have to pump more money into their businesses in the country, Yan Zhanmeng, research director at Counterpoint Technology, said to Yicai.

The global smartphone market is expected to grow roughly 3 percent in 2019 with worldwide shipment estimated to approach 1.5 billion units. But the growth of smartphone shipment in mature markets like China, America, Japan and West Europe is likely to slow down, said analyst Jia.

Under such circumstance, phone vendors can turn to emerging markets, including India, Indonesia, Russia, Brazil, and Nigeria, as demand there remain rigid, suggested Jia.

Email: tanyuhan@nbd.com.cn