Nokia Unveils Digital-Music Player In a Cellphone

 

Nokia Unveils Digital-Music Player In a Cellphone

By DAVID PRINGLE
Staff Reporter of THE WALL STREET JOURNAL
April 28, 2005

Nokia Corp., the world's largest cellphone maker, unveiled its first handset with a built-in hard drive, taking aim at the market for iPods and other stand-alone digital-music players.

Nokia, of Espoo, Finland, said the cellphone, earmarked to go on sale world-wide in the fourth quarter, will be able to store 3,000 songs and have a built-in Wi-Fi radio and camera. Dubbed the Nokia N91, the device will have a retail price of about €700, or about $908, before any subsidies by cellphone-service providers, Nokia officials said. That price compares with about $200 for an iPod mini with a similar storage capacity; the number of songs that can be stored varies because of different compression techniques. IPods are made by Apple Computer Inc.

Nokia's N91, which has a built-in hard drive, will retail for about $900.

Nokia's N91, unveiled alongside two high-end camera phones at a news conference in Amsterdam yesterday, underlines how cellphone makers are trying to displace other electronic gizmos as they search for sales growth. Motorola Inc., Schaumburg, Ill., Samsung Electronics Co. of South Korea and Sony-Ericsson Mobile Communications Ltd., a joint venture between Sony Corp. of Japan and Sweden's Telefon AB L.M. Ericsson, are among the other cellphone makers aggressively targeting the digital-music-player market.

While the Nokia N91 is more expensive than Apple's iPod, Nokia says the cellphone should be attractive to music buffs because of its ability to download music via third-generation cellphone networks or via the Internet using the short-range wireless standard Wi-Fi. Nokia said the N91 will be able to play music for 12½ hours, compared with about 18 hours for the iPod, on one battery charge.

"Stand-alone music players are not as interesting as they used to be," said Anssi Vanjoki, head of Nokia's multimedia division.

Some analysts, however, say many people will still prefer to buy devices that just do one thing well. "Most of these [Nokia] products are technically impressive," said Ben Wood, an analyst based in London with research firm Gartner Inc. "But converged devices are inherently a compromise."

Apple, of Cupertino, Calif., couldn't be reached for comment.

Still, Apple, which has licensed its music-player software to Motorola, also is looking at the market for cellphones that double as music players.

Jorma Ollila, Nokia's chief executive, said his company plans to ship 40 million handsets with a built-in music player this year. However, many of these will only be able to hold a small number of tracks and aren't a realistic substitute for a specialist digital-music player. Apple said it shipped 5.3 million iPods in the first quarter.

Nokia also said it has signed an exclusive agreement with lens maker Carl Zeiss AG to use the Oberkochen, Germany, company's lenses in camera phones. Nokia said the Carl Zeiss lenses will improve the quality of pictures taken by camera phones.

The first handset, the Nokia N90, to include a Carl Zeiss lens is earmarked to go on sale world-wide in the third quarter and to be priced at €700 before any subsidies by cellphone-service providers.

Despite the high-quality lens, the Nokia N90 will only have a camera capable of taking still pictures comprised of two million pixels -- a much lower resolution than most stand-alone digital cameras or some of the camera phones developed by Samsung.

Still, Nokia officials said the N90 handset will also be able to record video pictures well enough to be viewed full screen on a laptop computer.

Thanks to an improving product portfolio, Nokia's share of the wider cellphone market climbed to 31% in the first quarter from 28.5% a year earlier, according to figures from research firm Strategy Analytics. Last week, Nokia estimated its market share at 32% in the first quarter. Strategy Analytics said that industry shipments of cellphones totaled 172 million in the first quarter, up 10% from a year earlier.

Write to David Pringle at david.pringle@wsj.com¹

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