Nokia Ready for LTE Smartphone Boom, Announces AT&T as First Major Carrier

Nokia (NYSE:NOK) may have failed to create much of an impact in its previous attempts at the U.S. smartphone market, but the company is still pushing ahead. The company took a significant step forward in the resurrection of its smartphone business when it announced that it was finally letting go of its outdated Symbian OS, in favor of the more smartphone-friendly Microsoft’s (NASDAQ:MSFT) Windows Phone last year. However, just having a better OS at the heart of its smartphones alone isn’t going to win over customers who are already enamored by the immensely popular iPhone as well as the large number of Android devices on offer. Stronger ties with the U.S. telecom carriers such as AT&T (NYSE:T) and Verizon (NYSE:VZ) holds the key to Nokia’s future in the U.S.

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The Finnish handset vendor announced its first LTE-capable Windows Phone at the CES Monday, which it said will be exclusively made available on AT&T in the coming months. (see Nokia Unveils First LTE-Capable Windows Phone on AT&T) Nokia has already launched the Lumia 800 on T-mobile’s network January 11th.

Further, the company revealed later that it has plans to launch unique, exclusive devices for other U.S. carriers as well. ^[1]

We believe this is a very good move by Nokia as by doing so, it is taking the pains to address the specific needs of each carrier, thereby fostering stronger ties with them. Moreover, it also gives new carriers a compelling reason to sell a phone that other competing carriers are also selling. Also, the addition of an LTE-capable smartphone in Nokia’s armory gives it just the ammunition it needs to win the approval of the remaining major carriers, Verizon and Sprint, who are also banking on LTE to attract new subscribers. (see Nokia’s New Year Resolution: Spread Carrier Love)

LTE-capable smartphones have recently started featuring heavily on most carrier’s future plans, as they look to recover the huge expenses they are incurring in building out their LTE networks and expanding coverage to new markets.  So, in addition to its own and Microsoft’s marketing drive, Nokia will also benefit from the marketing push from each of these carriers. No wonder then that the newly introduced Lumia 900 will be enjoying a $100 million marketing campaign from Nokia, AT&T and Microsoft combined, with AT&T rumored to afford it a ‘hero’ status when it is launched on its stores.

Telecom carriers have increasingly become the backbone of a burgeoning U.S. smartphone industry, as they subsidize smartphones heavily in order to  drive data consumption rates on their networks. Lack of strong ties with carriers had prevented Nokia from cashing in on a nascent U.S. smartphone market at a time when competitor Apple launched the iPhone on AT&T’s network and gave it exclusive access for four years. However, recent announcements give us reason to believe that Nokia has learnt from its past mistakes and is willing to make amends big time.

With the carriers behind it and a competitive OS to boot, Nokia’s U.S. prospects have never looked stronger.

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1. Nokia to deliver exclusive U.S. Windows Phone devices to each carrier, FierceWireless, January 10th, 2012 [↩]