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Nokia To Click Revenues From Internet Ventures In India

KOLKATA: Finnish mobile phone giant Nokia, which plans to make a big bang entry into the internet services space, may take a different route to drive revenues from this business in India.

Nokia India intends to generate revenues primarily from advertisements for this business as against its global revenue model based on user subscriptions.

In effect, there’s enough reason for Indian consumers to cheer since Nokia India will make available a bouquet of internet services free of cost to consumers. This includes “commodity services” like songs, video clips and some mobile games as well. Nokia expect its initiatives will add nearly 10% from the services business to its India revenues over the next 2-3 years.

Nokia India managing director D. Shivakumar told ET the company will roll out its internet services in India in the first quarter of 2008. “Driving revenues out of the services business is a challenge in a market like India since consumers till now have grown up on a diet of free services. Hence, we intend to drive revenues out of advertisement from services,” he said.

The company feels there is enough potential to generate revenues out of advertisements in India. “While there are close to 80 million TV sets in India, the mobile phone penetration is expected to hit 225 million handsets by end-2007. Hence, there is a huge potential for advertisers to funnel information through the mobile screen,” said Mr Shivakumar.

Mr Shivakumar said the company is developing a new ecosystem for its services business with content providers and mobile operators. “All such agreements are currently being finalised. However, premium content like new songs, new videos and latest games will not be free for consumers. The pricing structure is currently being finalised,” he said.

While Nokia India will use its global technology for the services, there will be a significant level of local customisation. “Content will be locally adapted in several Indian languages, primarily Hindi, Tamil, Telegu and Bengali,” said Mr Shivakumar. The company enjoys around 53% share in the Indian market.

Nokia recently announced plans to foray into mobile internet services under the ‘Ovi’ brand. As part of its Ovi blitz, Nokia will roll out a web-based music store (Nokia Music Store), revive its gaming brand (NGage) and offer navigation services such as maps and city guides under the Nokia Maps stable.

Nokia may also drive some innovations to increase the speed of internet access for its mobile phones in India. “This is necessary since the speed of internet access from mobile phones is quite slow in India. Such innovations will also drive the services business,” Mr Shivakumar said.

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