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Nokia rides Chinese deal and stronger WP8 forecasts

Danske Bank upgrades 2013 estimates for Windows Phone, while Finnish vendor launches China's first WP8 device


Published: 5 December, 2012

READ MORE: Metrics | China | Nokia | Handset | Windows Phone

'Tis the season to be jolly, and the markets certainly seem to be engaging in a fit of holiday charity towards the also-rans of the smartphone platform race, RIM and Nokia.

Several analysts - notably at Goldman Sachs - have upgraded their forecasts for RIM, having seen the high level of carrier interest in the forthcoming BlackBerry 10, with a positive effect on the firm's ailing share price.

And now there is a more hopeful sentiment around Nokia too, largely because it has scored its first Lumia smartphone deal in China. Also, after Microsoft appeared to be spreading its favors too thinly with a renewed alliance with old friend HTC, the Windows giant has got fully behind Nokia's flagship Lumia 920 device. The partners are spending heavily on marketing, especially in the US, where a TV advertising campaign featuring Gwen Stefani and Jessica Alba is running.

Sales of the Lumia 920 are better than expected, according to Ilkka Rauvola, an analyst at Danske Bank, who has raised his predictions for 2013 WP8 sales sharply. In a client note, he forecast that 36m WP8 smartphones will sell next year, up from his previous figure of 23m.

At Microsoft's annual shareholder meeting last week, CEO Steve Ballmer said that WP8 was selling at four times the rate of WP7 phones during the same period last year and figures from Gartner, while less rosy than that, also suggest a gradual but visible building of momentum. The research firm says the third quarter of 2012 saw 4m Windows Phone devices sold, compared to 1.7m a year earlier.

These are still small numbers - and Nokia still sold more Symbian handsets in Q312 than Lumias - but they show some progress, which should accelerate with the impact of the holiday season, the strong reviews for Lumia in many areas, the integration of WP8 with its big brother Windows 8, and the China deal.

China Mobile will sell a version of the Lumia flagship, the Lumia 920T, which Nokia has adapted to support the cellco's unique TD-SCDMA 3G technology. Nokia has been working closely with the world's largest mobile operator for some years and the pair had a deep alliance around Symbian in earlier days. This has given the Finnish firm a headstart in supporting TD-SCDMA - Mobile has complained of the slow process of getting high profile smartphones onto its network, and has mainly depended on local suppliers. It has famously failed to agree terms with Apple for a special iPhone, despite multiple rounds of talks, and is now expected to wait for a TD-LTE version in future, for its expanding 4G 'trial' network.

"Our close cooperation with Nokia is a key contributor to the success of China's TD industry, and will further enhance the rapidly growing TD ecosystem," China Mobile's CEO Li Yue said in a statement.

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