Nokia being given a lesson

Nokia recently announced Ovi it’s own music service to compete with iTunes. This launch also included some new phones such as the N81. But it looks like Nokia as run into a few stumbling blocks, namely the UK mobile carriers.

Ovi not only competes with iTunes but the carries own walled garden music services. Therefore the carriers see this as competition for it’s revenue and decides the easiest thing to do is to close out Nokia by not including the N81 in their line ups.

In the UK the model is that the handset is subsidised by the carrier, therefore the consumer is used to paying very little for a handset which has a true value of several hundred pounds.

Therefore the average UK consumer would baulk at the cost of a new handset unlocked, so this causes a problem for Nokia, no way for Nokia to get it’s music service into the hands of the average UK consumer.

I wouldn’t be surprised if we see a subsidised Nokia handset with some sort of monthly access to Ovi with Napster rental style DRM, or Nokia just pushes the cost of the N81 down to iPod prices or near cost with Nokia looking to gain the revenue from Ovi instead.

Downloading the Ovi tunes over wi-fi would mean a real kick in the teeth for the carriers as they would be providing the thin margin voice/text services only with none of their own value add services being included.

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