Nokia eyes more internet purchases to boost growth

Helsinki: Nokia's internet offering is far from ready and the world's top cellphone maker is seeking further acquisitions to speed up the roll-out of new services, Niklas Savander, the head of the unit, said in an interview.

Nokia bought US digital maps firm Navteq for $8.1 billion in July and has acquired ten smaller firms to jump-start its internet services business as the growth in the cellphones market is set to stall.

"We're not done," Savander told Reuters when asked about further acquisition plans.

Likely targets could be small companies which develop services Nokia itself plans to offer in the future - enabling the Finnish firm to roll those services out faster, he said.

In a media event late last night, Nokia introduced The Files on Ovi service, based on the acquisition of Avvenu last year, which allows users to store files on the Web so that they are always accessible, an increasingly common service offered by internet firms like Google and Yahoo.

Nokia introduced a new personal information management (PIM) synchronisation service for calendar, contacts, notes and tasks between Nokia phones and its internet services site - similar to Apple and Microsoft offerings.

Genuine demand

"We obviously think there is genuine consumer demand. Information that is contained on device is becoming more and more critical to people," Savander said in a recent interview.

"We are incrementally, step-by-step, building up the offering that has to be matched with demand," he said.

Nokia has not unveiled user numbers for its internet services, but it created April-June revenues of 119 million euros ($170.7 million), up 42 per cent from the previous quarter.

Looking for services clients, Nokia has opened up its media sharing site and games offering on Facebook and is looking to broaden ties with the social-networking site.

Media sharing site

Nokia hopes to combine its internet services - such as gaming service N-Gage, its navigation service and digital music stores - into one user-friendly system, but so far all services have separate sign-on systems and no links between them.

In the handset industry Nokia has built its success on the easy-to-use phones.

"Our target is to make it more seamless, more and more integrated. We are absolutely not yet where we need to be."

"When will it be perfect? Never. When will it be better? Very soon. So it is an incremental thing, in six months it will be dramatically better than it is today and in 12 months it will be more improved," he said.

Savander said the firm has put a priority on getting new services to the market fast and testing consumers response, rather than fully integrating the service offering from the start.

"We are realising of course that as a consequence of this we are making it a little bit more complicated to the user than is the ideal situation," he said.

Nokia's move to services has raised fears among operators that the cellphone vendor would steal their growth business, but Savander said the dialogue with operators was very pragmatic, as both look for more users and profits.