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Issue #2003 - 05 (February 2003)
(Updated Feb. 13, 2003)


Nokia Shows Off Mobile Game System, The N-Gage, in London & Sydney

05 February 2003 -- Dow Jones -- Nokia Corp. unveiled its new game console last week amid a mixture of curiosity and skepticism over whether the world's largest mobile-phone maker can make a splash in a market dominated by Nintendo Co. Ltd. 

Nokia announced in November that the N-Gage, which will double as a mobile phone, was on the way but has withheld details of the product, its partners and its strategy. 

"They are playing in a very, very competitive market," said Richard Windsor, a London-based telecommunications-equipment analyst at Nomura. He said he would be surprised if Nokia, which sold more than 150 million mobile phones last year, sells more than 300,000 consoles this year. 

Nokia will introduce the console at an evening news conference at the London Eye observation wheel. 

"I'd keep my feet on the ground with this one," said Jussi Uskola, a telecom-equipment analyst who follows Nokia for Nordea Securities. 

Analysts said Nokia will have a hard time taking on Nintendo, since the Japanese company has had a head start of more than a decade and hundreds of games are already available for its handheld Gameboy Advance console. Game developers are more likely to stick with Nintendo until the Nokia game proves itself, said Dario Betti, an analyst at research consultancy Ovum. 

Nokia has said Sega Corp. will develop games for the device, and Nokia will also publish games itself. The Wall Street Journal Europe last week reported the console would be available in the U.K. by May, 2003.  

Shaped like a half-moon, the N-Gage resembles the 5510 handset that Nokia introduced in late 2001, which included a horizontal keyboard and an MP-3 music player and was meant to appeal to game aficionados. It didn't sell well. The N-Gage will play branded games distributed on cartridges and will support Bluetooth short-range wireless communications, allowing nearby players to play games together. 

Source: Dow Jones 
For more information: http://www.dowjones.com

MobileInfo Comments and Advisory: Nokia is the leading player in cellular handsets. It wants to convert a telephone into a gaming device. It follows its earlier strategy to convert a telephone into a digital camera.

Nokia's N-Gage is an effort of wireless handset manufacturers to create a mobile entertainment industry which does have a huge potential but at the right price point. This industry is well-served by conventional games players like Nintendo and Microsoft (X-Box). If we compare the current gaming players and the products they offer to what the wireless entertainment vendors intend to offer, we could come to the conclusion that the new entrants offer only a small increment in functionality for a significant price differential. The delta increment in functionality is in terms of downloading of new games wirelessly and of friends playing interactive games remotely. Both are worthwhile and interesting features and if the price was right, consumers may jump. However, there is no time-sensitivity to download the latest game in the market before you reach an Internet-cradle at home for these gaming devices. We expect only a slow adoption of N-gage like devices. We shall be watching the scene for a longer term trend, which is hard to call. May be, we are too-focused on the enterprise and not on the consumer, our critics will say. Young consumers will be be the final judge.

Note: This news release may contain forward-looking statements within the meaning of section 27A of the Securities Act of 1933 and section 21E of Securities Exchange act of 1934 in USA. Similar provisions exist in other countries. There is no assurance that the stipulated plans of vendors will be implemented. MobileInfo does not warrant the authenticity of the information. Readers should take appropriate caution in developing plans utilizing these products, services and technology architectures.  All trademarks used in this summary are the property of their respective owners.

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