Nokia New Touchscreen Asha Phones to Start at 63 Euros

Nokia Oyj (NOK1V) added three touchscreen handsets to its Asha line of phones, as it revamps its lower- priced handsets to meet demand for smartphone features.

The Asha 305, shipping this month, is priced at 63 euros ($79), and will be the company’s cheapest full-length touchscreen phone, Juha-Pekka Sipponen, vice president and head of portfolio and product management, said in a telephone interview. The Asha 306 model, priced at 68 euros, and the 92- euro Asha 311, featuring a faster touchscreen and a 1-gigahertz processor, will be added in July, he said.

Nokia is trying to reinvigorate its low-end phone business where shipments fell 16 percent in the first quarter as customers upgraded to cheap smartphones running Google Inc. (GOOG)’s Android or deferred replacing their handsets. Espoo, Finland- based Nokia shifted last year to Microsoft Corp. (MSFT)’s Windows Phone as its main smartphone platform. Its cheapest Windows Phone- based model, the Lumia 610, is priced at 189 euros.

“The main reason Nokia has been struggling in feature phones lately is that it lacked touch products,” said Sami Sarkamies, a Helsinki-based analyst at Nordea Bank. “This announcement won’t help much in the second quarter but I think there will be a notable impact in the third quarter.”

Nokia advanced 3.4 percent to 2.21 euros as of 12:32 p.m. in Helsinki trading.

Brand Building

Nokia sold 18 million dual-SIM devices in the third quarter of 2011 after adding the feature which lets users swap easily between operators to save money. It could see a similar bounce from the new Ashas and ship “tens of millions” of them in the second half, Sarkamies said.

Nokia is trying to build the value of the Asha brand and blur the difference between smartphones and midrange phones, Sipponen said. The handsets run Nokia’s Series 40 operating system, introduced in 1999, with the Asha touch user interface on top of it.

The new Asha touchscreens will give customers a better experience with existing services such as map databases and mobile applications, Sipponen said. Rival Samsung Electronics Co., which passed Nokia this year as the world’s largest maker of mobile phones, sells touchscreen feature phones under the names Star and Champ.

‘Blurred Market’

“This blurred market will continue to exist,” Sipponen said. “There is quite a lot of runway ahead -- 3.2 billion people still don’t have a mobile phone.”

Nokia is including 40 free games from Electronic Arts Inc. (EA) with the new phones, as well as Rovio Entertainment Oy’s Angry Birds on the higher-priced Asha 311.

“There’s still a gap in Nokia’s portfolio at the moment between its most affordable smartphones and the top of the Asha range,” said Tim Shepherd, an analyst with Canalys in Reading, U.K. “Nokia has a very good opportunity here if the marketing is pitched correctly and focuses on the experience offered.”

Previous Asha handsets had phone keypads or Qwerty keyboards, in some cases combined with touchscreens in models Nokia calls “Touch and Type.”

The dual-SIM Asha 305 and single-SIM Asha 306 will use 3- inch resistive touchscreens, while the dual-SIM Asha 311 will have a capacitive touchscreen, the faster type used on most smartphones, Sipponen said.

The decline in shipments of Nokia low-end phones in the first quarter came amid a slide in worldwide low-end phone sales to end customers in the period, according to Gartner Inc. data.

Nokia Chief Executive Officer Stephen Elop has said the company will drive prices of Windows Phones down as well as continuing to revamp products aimed at lower-income users in emerging markets. The new devices are part of Nokia’s plan to connect the “next billion” users to the Internet, Executive Vice President Mary McDowell said in a statement today announcing the new products.

The list prices of Nokia phones don’t include taxes and subsidies.

To contact the reporter on this story: Diana ben-Aaron in Helsinki at dbenaaron1@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

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