If anyone still doubts that low-income folks make good customers, they should talk to executives from Nokia (NOK). The Finnish company owes its 40% share of the global handset market in large part to residents of places like Calcutta, Lagos, and Shanghai, many of whom live on just a few dollars a day. Now, with the No. 3 player, Motorola (MOT), on the ropes, Nokia has an opportunity to extend that lead. But other rivals are eyeing the Finns' success and stepping up efforts to woo those same people.
Motorola's woes create a substantial opening. The company is suffering after missteps in emerging markets and its failure to develop a new model as popular as its smash hit Razr, and management may sell the handset business. Moto is particularly vulnerable in Latin America, where the U.S. company and Nokia are neck-and-neck at about 26% each. "Motorola is holding up pretty well in its home territory. But if the weakness spreads, there is potential for rivals to take market share," says Neil Mawston, an analyst at Strategy Analytics.