June 10, 2009

Nokia N97’s Price Tag – Reasonable?

Permalink: Nokia N97’s Price Tag – Reasonable?
by Franz Bicar

In a market saturated with competing products, it is very important for market players to be ahead and stay ahead of your competition. May it be through your products features, pricing, additional and post-purchase services or the overall package offered to the consumer. One of the best lures for consumers, of course, is the price. Given the right functionalities users need in a product combined with a very reasonable price, then for sure, customers will flock and buy that product.

Nokia_N97 Nokia, on the other hand, seems to have forgotten this formula. On Tuesday, the mobile phone giant release its N97 touch screen smartphone. One of the best selling points of today’s smartphones seems to be the touch screen feature -  so Nokia’s venture towards this path is very logical. What is not, however, is the whopping price tag of $699. For consumers are accustomed to paying $200 for a smartphone, this price seems a bit ridiculous.

The Nokia N97 is an impressive phone. And it offers several advanced features that are not available on other phones, such as a 5-megapixel camera. It also offers more memory than any of these other phones. It comes loaded with 32GB of internal storage on the device with the option of adding up to another 16GB of storage through a microSD card.

The N97 also supports Flash video, something that Apple’s Safari browser doesn’t support. And Nokia has built-in easy access to a number of social-networking sites. The N97 also introduces something Nokia calls social location, which uses the capabilities of the integrated A-GPS sensors and electronic compass to automatically update users’ social networks, or let them share their location via photos or videos with friends.

The phone which was announced last December, has already gone on sale and is available for consumers in the US and Europe.

In Nokia’s defense, the reason for selling the N97’s at such an outrageous price is that Nokia is not just selling it through any particular carrier. Instead, Nokia is selling it in the US and Europe through their Nokia flagship stores as well as online. Nokia has made other phones for the US and European market and has also sold them without carrier backing. The N95, the previous generation of N97, retails for about $550. But a phone priced at $700 in the US and European market is likely to be too high for consumers, especially when most devices sell for $200.

Aside from the pricing, Nokia also could have picked a better date to debut the N97. On Monday, Apple announced the iPhone 3G S, their latest iteration of their successful iPhone. Another company releasing a hyped product is Palm with their Palm Pre. Each of these devices can be bought for far less than the Nokia N97. The 16GB iPhone 3G S will sell for $199. And the 32GB model, which has the same amount of built-in memory as the N97, will cost $299 when the phones go on sale next week. Apple has also cut the price of its 8GB iPhone 3G, introduced last year, to only $99. The Pre, which also has a slide-out QWERTY keypad and a touch screen like the N97, is $199 with a $100 mail-in rebate.

The only advantage of Nokia in this case is that for both devices, consumers must sign a two-year contract to get the discounted prices. By contrast, the N97 is not bound by any contract and the quad-band (GSM 850/900/1800/1900) device can be used on almost any HSDPA network throughout the world.

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