Nokia Trying to be Leader - Thanks to Asha

Nokia is struggling to revive its smartphone business. However the company is getting good response for the basic mobile phone 'Asha' which it sells for $39. By adding features such as quicker Web and online games to its Asha handsets it is getting popular in India & China. Nokia boosted its share of the basic phone market to 35% in the last quarter. This % is the highest in the last two years.

The basic phone business is profitable and unit sales are increasing for Nokia

Nokia sells more than 70 million cheaper handsets with gives relief to the company. Company's CEO Stephen Elop is trying to stem revenue declines and recover from five quarters of losses.

The basic phone division is also winning over first time users who may stick with Nokia when upgrading to a more expensive device.

 "Nokia's Asha models are selling quite well and that is good news for them since it gives the company a bit more time to get its smartphone business on track," said Teemu Peraelae, who helps manage $1.5 billion including Nokia shares at Alfred Berg Asset Management in Helsinki.

A buyer is benefited from Nokia's strong relation with carriers in growth economies. Asha phones cost less and are getting famous in the developing markets because they resemble smartphones. Asha phones and other low end Nokia models have almost all features like Downloading Apps, Touch Interface, Social networking integration hence they resemble completely like a smart phone.

The Asha 305, retailing at 65, is Nokia's cheapest full-length touch-screen phone. The Asha 311, featuring a faster touch screen and a 1-gigahertz processor, costs 95. The company on average sells basic phones for 31 each, compared with 151 per smartphone. The 305 and 311 are seeing "fantastic traction" among customers, said Sathish Babu, who owns handset retailer Univercell with about 500 outlets across southern India.