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Nokia 'right' to target Africans

Nokia Oyj's bet that Africans will consider a mobile phone to be as vital as corn, which is at 11-year-high prices, stands a good chance of succeeding, Bloomberg reports.



A surge in demand from India and China this decade made the Finnish company the world's dominant maker of wireless handsets. Now CEO Olli-Pekka Kallasvuo has designated Africa as his company's next target.

As in most developing regions, owning a mobile phone in Africa is viewed as such a "necessity" that growth won't be stymied by money being diverted to pay record prices for staples, Kallasvuo said in April.

Already the world's fastest-growing mobile-phone market, Africa still has the lowest penetration, at below 30 per cent, of any continent.

This growth potential may help Nokia sustain sales through the slowdown that has gripped Europe and the US this year and sent the company's shares down 31 per cent. Africans bought 33 million handsets in the first quarter, up 37 per cent from a year earlier, according to Boston-based researcher Strategy Analytics. That isn't far from the 37.9 million purchased in North America, where industry shipments fell 4.5 per cent.

The African market will grow by 33 per cent this year, projects Neil Mawston, an analyst in London for Strategy Analytics. Nokia, based in Espoo, Finland, claims it commands 55 per cent of sales in Africa and the Middle East.


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