Nokia to change how they measure mobile industry unit shipments, will include Asian counterfeits

Nokia released a press release today stating that they’re going to be “revising its definition of the industry mobile device market that it uses to estimate industry volumes”. The new definition will include “vendors of legitimate, as well as unlicensed and counterfeit, products with manufacturing facilities primarily centered around certain locations in Asia and other emerging markets”. Using the new definition applied to 2009 figures, Nokia says the industry shipped 1.26 billion units versus 1.14 billion. That’s 120 million devices they’ve previously unaccounted for, or in other words, more mobile phones with the word NOKLA on the front than what LG officially shipped in 2009. Nokia also said that using this new definition for mobile devices, their present market share is not 38%, but in fact “only” 34%.

The Finnish company has also tweaked their expectations for where the market is heading in 2010. They say industry volumes will be up 10% compared to 2009, that their market share will be flat, and that their “value share”, which is a term that’s only recently been starting to float around thanks to Apple’s small unit sales, yet ridiculously high profits, will be up slightly.

Considering Nokia predicted industry volumes for 2009 would be down 10%, and in reality the market was simply flat compared to 2008, this new 10% growth statistic is going to be on the low end of many analyst projections.

  • Johnny Tremaine

    So their share has not only gone down, but it will include knock offs from rivals? So much for transparency for investors.

    I’ve dismissed the idea before, but seriously now, Nokia is, if not dying, then it’s in the intensive care ward.

    They need a huge shake up at the company followed up by some big strategic moves, otherwise that market share has no place to go but down.

  • Leslie Shannon

    No, you haven’t quite gotten it right — it’s not that Nokia is going to be calcuating these “Noklas” as part of their own market share, it’s that they’re going to be counting the fakes out there as part of the total number of handsets in the world, against which they calcuate the Nokia market share. The fakes had been left out before, because they’re not sold through official channels like the “real” brands. But Nokia is actually being pretty honest, and saying, hey, let’s look at the market as it REALLY is, which includes these grey market fakes. So, including the fakes, that means that the total calcuated number of handsets in use in the world now goes up, which means that Nokia’s market share of this total world number goes down — since the number of how many Nokias were sold last year hasn’t changed, but now it’s being calculated as a percentage of a larger base. This means that Nokia has only 34% of this larger (and more accurate) world market, not 38% as they caculated before. No company likes to see their market share go down, so I think Nokia has actually been pretty brave here in bringing more accurate numbers into the business discussion, even if it means that their own market share looks less rosy as a result.

    • Stefan Constantinescu

      Thanks for breaking it down for “Johnny Tremaine”. I hope he reads your comment, but I severely doubt he does.

      Was I not making my blog post clear enough? Or is this simply a case of “the world will always design a better idiot”?

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