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Nokia Renews Mobile Devices Agreement With China Postel

Posted on: Tuesday, 11 March 2008, 06:00 CDT

Nokia has significantly expanded its presence in China after signing an agreement with China Postel Mobile Communication Equipment Company through which the Chinese company will purchase mobile devices valued at approximately $2bn from Nokia in 2008.

In addition to the mobile devices contract, both companies have agreed to strengthen their strategic ties with regards to channel development, resource investment and marketing management.

China Postel, a subsidiary of China P&T Appliances, is the country's largest distributor of mobile phones, with a current market share of nearly 30%. Although the Chinese firm's latest deal with Nokia is significant, it is of slightly less value than the deal forged by the two companies in 2007, when China Postel agreed to buy $2.5bn worth of Nokia devices.

Nokia spokesperson Thomas Jonsson told Bloomberg that the drop in the value of the China Postel order is a reflection of the fact that Nokia sells its devices in China through different channels, and that the size of the channels varies at different times.

Nevertheless, David Tang, vice president of sales at Nokia China, was positive about the contract, which adds to Nokia's existing agreements with three national and more than 25 local distributors in China.

Mr Tang said: "As the largest mobile phone manufacturer in both the global and Chinese markets, Nokia considers China a strategic market and a significant base of manufacturing, R&D, and innovation."

Source: Datamonitor

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