Nokia To Axe UK Online Shop

Nokia customers will no longer be able to purchase handsets direct from the handset maker, after the announcement that Nokia will close its UK online store.

The Nokia online shop allows UK customers to purchase Nokia handsets, monthly contracts, SIM-free handsets and mobile accessories directly from the Finnish company. But the shop is to close on 30 June, as will other Nokia shops in Germany, Ireland, Italy, Russia, and Switzerland.

At its height Nokia had 12 shops around the world, but Nokia’s online stores in France, Spain and the Netherlands have already been closed down.

Wider Strategy

“We can confirm that Nokia is planning to close down its UK online store, although no date has been confirmed,” a Nokia spokesman was quoted as saying by Mobile Today. “The closure is not only in the UK but will also include our online stores worldwide. We are working closely with partners as part of a company overhaul and closing our online stores is part of a wider company strategy.”

“We have many other retailer outlets that our customers can use to purchase our products,” added the Nokia spokesman. “These channels will allow us to continue to meet our customers’ needs.”

Whilst it may be easy to point to the closure of these stores as further evidence of Nokia’s woes, in reality the closures are part of a much need overhaul of Nokia’s strategy.

The simple fact is that not enough people opted to purchase their handsets direct from Nokia.

Pricing Problem

The one advantage of the Nokia shop is that it did allow UK customers to get their hands on a new Nokia handset a week or two ahead of the rest of the market. But in reality the online shops could not compete on pricing. Indeed, customers could generally get the handsets cheaper by using the usual online retail channels such as Amazon.com and Play.com.

And of course another big problem for Nokia is that in Europe, mobile handsets are usually acquired via the customer’s mobile operator, who sell the handsets at a much cheaper subsidised price.

Last month for example, Nokia Spain told Engadget that the closure of the Spanish shop was caused because “prices are too subsidised by the carriers and sales were low”.

Troubled Times

Beleaguered Nokia has been struggling to reposition itself in the face of the onslaught from the likes of Android and Apple. Indeed, such are Nokia’s woes that it is expected to soon lose its crown as the leading smartphone maker.

A recent forecast from Nomura for example has predicted that Nokia’s position as the top producer of smartphones could well end this quarter.

Meanwhile Nokia’s CEO Stephen Elop has opted to ditch Symbian and use Windows Phone 7 as its primary smartphone operating system.

Just last week, Elop denied rumours of an imminent $19 billion (£11.6bn) takeover by Microsoft. Samsung was also reportedly a potential buyer.

“Nokia is not for sale,” Elop told an audience during the Open Mobile Summit in London, according to The Wall Street Journal.