Nokia unveils three new phones

HELSINKI, FINLAND:  Nokia Oyj unveiled three new cellphone models, including the successor to its top-selling 6300, as the world's top handset vendor pushes to win a larger share of a shrinking market.

Nokia's 6700 Classic -- the follow-up to the 6300, which became one of the top selling mid-range phones ever -- will sell for 235 euros ($307) before subsidies and taxes when it goes on the market in the second quarter.

"This phone should be a 'home run' for Nokia. It has the premium finish, but comes in at the same price as the 6300 when it was launched," said Ben Wood, research director at CCS Insight. "It should hit a sweet spot where Nokia has proved it can be so strong."

Cellphone sales will dive this year, hit by consumers' reluctance to spend on new gadgets in the midst of the economic recession and large inventories built up by phone sellers at the end of last year.

The 6700 model will have a 5-megapixel camera and GPS navigation with Nokia Maps.

"Our new arrival shares the same 'DNA' as its predecessor and we believe that it will be one of our best selling devices in 2009," Soren Petersen, senior vice president at Nokia, said in a statement.

Nokia also unveiled the 6303 and 2700 models, which are expected to sell for 135 euros and 65 euros respectively, excluding subsidies and taxes.

"The 6303 offers a lot of phone for its price tag -- it could work well this year as consumers tighten their belts and look at a cheaper alternative when they upgrade their phone," said CCS Insight's Wood.

Shares in Nokia were 1.6 percent lower at 9.73 euros, underperforming a softer DJ Stoxx European Technology Index.

The launch comes at the start of what is expected to be a tough year for the cellphone industry, with analysts expecting market volumes to fall 10.7 percent to 1.08 billion phones.

Retailers and operators are trying to cut inventories after a weak Christmas sales period, leading to increasingly aggressive pricing.

While vendors often cut prices in January, some cuts have this year been much bigger than usual.

Overnight, chip maker Qualcomm said it expected phone makers and service providers to cut inventories for several more months before things would improve.