The world’s largest seller of mobile phones says its devices and services unit will lose money during the first half of this year as it struggles to make the transition from feature phones to smartphones. So far Nokia says it has sold 12 million smartphones this year, but most of those were its end-of-life Symbian phones. During the first quarter, Nokia sold more than 2 million of its new Lumia Windows-based phones. This past weekend, Nokia launched its flagship smartphone, the Lumia 900, on AT&T’s network here in the United States. But many frustrated buyers found that their phones could not properly access the network, and Nokia was forced to admit that a memory management problem was compromising data connectivity.
Nokia says it already has a fix for the bug. “We’re already manufacturing devices with the new software,” Nokia’s U.S. chief Chris Weber said in a statement. “Those are being shipped to AT&T stores.” As the new phones arrive in stores, customers who have already bought a Lumia 900 can swap their phones for the new ones. Or, they can update their software by syncing the phones they bought with Microsoft’s Zune app on a Windows PC. Nokia says the update should be ready by Monday.
Neil Shah, wireless device analyst at Strategy Analytics, was not completely surprised that the Lumia 900 launched in the US with a small bug. “The smartphone is such a complicated device now… you need 1,000 test cases before launching it. It is particularly challenging when you have to customize a handset for a particular carrier.” Shah says that Nokia has worked closely with AT&T, Microsoft, and Qualcomm (the chipset supplier), and he is impressed with the performance of the Lumia 900, especially its battery life, which he says surpasses that of many Android LTE phones.
Nokia says anyone who has bought a Lumia 900 or who plans to buy one before April 21st will get a $100 credit on their AT&T bill. Since the smartphone retails for $99 with contract, the new rebate makes the phone free for the next 10 days.
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