Nokia chief executive Olli-Pekka Kallasvuo says that the developed world is warming up to smartphones that share a lot of features. But the world’s biggest cell phone maker has sold more than 750 million basic phones in the emerging markets around the world in the last five years. And while smartphone users have a lot in common, he says that a one-size-fits-all approach doesn’t work in the rest of the world. That’s the theme of his speech at the Consumer Electronics Show.
It’s no secret that Nokia has had a tough time getting traction in the U.S. with smartphones against competition from Apple’s iPhone. But Nokia has fielded lots of local teams to research markets around the world and has found that it has to help make local solutions viable to increase phone usage. One of the company’s cheapest phones, the Nokia 1616, costs around $32. That amounts to a month’s of wages in many countries. Yet it sells in huge numbers, thanks to customized services that make it far more useful in emerging markets.
Kallasvuo noted how far the industry has come since Nokia introduced a $6,000, $1 per minute cell phone in 1987. He notes there are interesting divergences around the world. In Ghana, there is a hack that allows a phone to have two SIM cards, or unique identifications. There are many places in Africa where entrepreneurs operate businesses that make money from charging stations, as many people have no access to home electricity.
In India, Nokia has set up a system, Progress Project, to allow business to send transactional data back and forth via text message. So whole businesses are running on cell phones. These are being used by farmers in rural areas to auction off onions in western India. There, the phone serves as the banking system, currency provider, and marketplace. Last year, the company introduced Nokia Money to bring together payments on a global scale. It’s not tied to a single bank, carrier, or country. It’s important, Kallasvuo says, because 75 percent of the world’s people still haven’t sent an email.
Through its Ovi Store for mobile apps, Kallasvuo hopes that developers will create many more apps that can be useful in different regions in the world, from Sesame Street educational phone apps to local business directories. Improving lives can happen through hardware, software, and services.
“I firmly believe we have only scratched the surface of our ability to do business and do good in the world,” Kallasvuo said.
The company is putting money behind this interest in the emerging world. It is creating the Nokia Growth Economy Venture Challenge, giving the winner of someone with the best ideas for the emerging markets a $1 million investment from Nokia. The winner will be announced in June and the site is CallingAllInnovators.com
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