/ 7 September 2008

Nokia takes on iPhone

Nokia, the world’s largest mobile phone company, launched an all-out assault on Apple’s iPhone this week with a new range of phones that will give music lovers access to an unlimited service.

Anyone willing buy a Nokia Comes With Music pre-pay phone will be able to download up to 2,1-million music tracks — about a quarter of the number available from Apple’s iTunes — on to their computer for no extra charge for 12 months.

Those tracks can be loaded on to the Nokia phone and after a year users will need to buy a new device to continue downloading new releases. But unlike other so-called unlimited music services, if they choose not to buy a new device, they can keep all the tracks they have already downloaded. They will still play on the user’s computer and handset, which will also still be able to send SMSs and make calls.

Nokia, which is hoping the phone will be popular this Christmas with parents seeking to make their children’s music file-sharing legal, announced that the United Kingdom will be the first market to get Comes With Music.

The first phone will be its 5310 handset, although at least one more device will be announced in time for Christmas.

The company has signed up Carphone Warehouse, which has more than 800 shops, to stock the phone. Carphone Warehouse is also Apple’s sole independent stockist of the iPhone.

Nokia’s UK managing director, Simon Ainslie, believes the Nokia Comes With Music range will be ‘the number one selling product at Christmas”.

‘This is a unique proposition. Nobody has launched an unlimited music service that allows you to keep your music with no catches,” said Ainslie. ‘What we are trying to do is bring back some value to the music industry from people who are not paying for music. There are a lot of parents who would like to legitimise their children’s purchasing of music.”

Already some internet service providers have sent letters to persistent illegal file sharers warning them that their activities have been noticed, having reached a deal with industry body the BPI. For many parents this will be the first indication that their children are doing anything illicit on the internet.

Nokia Comes With Music, which was first mooted last year, is a gamble for the Finnish handset maker, which supplies four out of every 10 phones sold worldwide. It risks further damaging Nokia’s already fraught relationship with many of the major cellphone companies. Last year it provoked their ire by announcing its own suite of mobile services — under the Ovi brand — which operators saw as a direct attempt to undercut their relationship with cellphone users.

In fact, Nokia does not yet have a cellphone partner for Comes With Music. As a result, anyone buying the phone will have to put their existing SIM card into it or sign up for a SIM-only deal.

All five UK networks have held talks with Nokia about Comes With Music, but none has found the service attractive — or lucrative — enough to sign up. All the operators have their music download services and see no reason to subsidise a handset that connects users with Nokia’s own music store rather than their own. But Nokia still hopes to persuade an operator to subsidise the cost of the phone, which is why it will not set the price of the first handset until next month. It is expected to cost somewhere between £100 (about R1 360) and £300 (about R4 080). —