Nokia believes that more than half of the predicted 400 million new mobile subscribers by the year 2005 will come from the developing world, making it a market worth focusing on.
The company expects there to be some 1.6 billion mobile phone subscribers globally by 2005, up from 1.2 billion at present, and it predicts that a large percentage of these new subscribers will come from countries such as Brazil, China, India and Russia.
"Demand from developing countries will be the main driver for mobile phone market growth in the next few years and we see the 1.6 billion figure as a conservative estimate," says Kari Tuutti, spokesman for Nokia Mobile Phones.
"If the industry can lower the cost for the consumer, we have the potential to gain hundreds of millions more subscribers."
According to Tuutti, one of Nokia`s main strategies has been to develop cheap, high-quality mobile phone models and a number of these will be launched shortly.
"In some countries operators are able to make a healthy profit with a monthly revenue stream of less than 10 euros per customer, so with the right business model, the operators can expand into the lower segments of the market and still have an attractive business."
He says that another reason for the increasing use of mobile phones in developing countries is the high cost and limited number of fixed lines, which prompts many users to skip a landline phone altogether.
"We see more new subscribers in emerging markets getting a mobile phone as their primary phone and simply choosing not to use a fixed line at all," says Tuutti.
"One example of this is China, where the number of mobile phone users sits at over 220 million, already exceeding the number of fixed lines available in the country. As a result, the mobile share of global voice traffic is expected to increase to 30% within a few years, compared with the current 20%."
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