Nokia is shutting down its luxury mobile phone stores in Japan, as the company continues its strategy of offering offer low-end devices to regain market share from Apple and Google.
Nokia’s Japanese stores, like Vertu, which specialized in luxury phones that sold for as much as $250,000, will be closed by the end of July. Nokia says it will still do business with Japanese craftsmen on products that will be sold in other markets.
While Nokia once controlled nearly half of the global handset market, the Finnish phone maker has never had a strong presence in the Japan. The company’s phones have struggled in Asian markets to keep up with the immense popularity of Apple’s iPhone and Google’s Android devices.
This latest move comes just a few weeks after the company announced its plans to flood emerging markets in Asia with low-end offerings. Experts believe Asia’s mobile market will grow by 40 percent in the next five years, paving the way for billions of devices.
Nokia’s phones could appeal to the millions in those markets who do not have the money to spend on an iPhone or a top-of-the-line Android device.
Nokia, the number-one phone manufacturer in the world since 1996, has been slipping lately against its rivals. Both Samsung and Apple are expected to surpass Nokia’s global smartphone shipments later this year, prompting the company to make adjustments to stay in the race. To get itself out of the hole, the Finnish manufacturer is teaming up with Microsoft to put the Windows Phone 7 operating system on all of its future smartphone devices.
Nokia is hoping the move will help it return to relevance in a smartphone market that has become dominated by Apple and Google’s Android-based devices.
As part of its strategy as Nokia waits for its Windows-based phones to hit the market, the company will slash the prices of its current smartphones in Europe to try and stir up sales.
Unlike in the U.S. and Europe, where the mobile phone market is already established, emerging Asian markets may provide Nokia with a growth opportunity. The complete closing of the Vertu stores in Japan will help Nokia focus its business on this wider, potential customer base.