Nokia’s CEO Olli-Pekka Kallasvuo leaves the stage after his speech during Capital Markets Day at Dipoli Conference Centre in Espoo in this December 2, 2009 file photo.

Credit: Reuters/Lehtikuva/ Pekka Sakki

HELSINKI (Reuters) - Nokia, the world’s biggest cellphone maker by volume, will introduce new smartphone models next week at its annual media and industry event, aiming to assure investors the company is on track to recovery.

Nokia, whose profits and share price have dived in the last few years, is now betting on the renewal of its line of smartphones, which could save the career of embattled CEO Olli-Pekka Kallasvuo.

The cellphone maker will unveil its new flagship model E7, which comes with a large touchscreen and full keyboard, at the show in London, two sources with direct knowledge of Nokia’s plans told Reuters.

Nokia will also introduce to the public its new N8 model, which is the first phone to use the new Symbian 3 software, along with other new smartphones, the sources said.

The N8 — unveiled in April and due to go on sale later this month — stands out among its rivals for its 12 megapixel camera but has a slower processor than Samsung’s top model Galaxy S and the latest iPhone.

"As the N8 starts shipping and other devices are unveiled, Nokia will be hoping that it can lay the foundation stones for its recovery given the onslaught of competitive products currently hitting the market," said Ben Wood, director of research at CCS Insight.

"It has made some big commitments on fixing Symbian and its first flagship product using the refreshed Symbian operating system. Failure is not an option," Wood said.

Nokia’s Symbian operating system has yet to attract a large number of software developers interested in creating compatible applications, a key selling point for high-end cellphones.

HAVE THEY FIXED IT?

Nokia controls 40 percent of the smartphone market with its Symbian software but has lost its leading position among the most expensive models to easier-to-use phones from Apple and Research in Motion.

Nokia’s failure to roll-out successful high-end cellphones, which have fatter margins, has hit the company’s profits and share price hard over the last few years. Its stock has dropped to roughly a third from mid-2007 when the iPhone went on sale.

Last year, Apple surpassed Nokia as the handset maker generating the largest total profit, despite selling only one iPhone for every 13 phones Nokia sells.

CEO Kallasvuo, whom industry sources say Nokia is looking to replace, has promised the usability of Nokia’s Symbian smartphones would not be an issue by the end of this year.

He will make the keynote speech at the London show on Sept 14 at 9 a.m. (4 a.m. EDT).

"Everyone will be very curious about the Symbian 3 user interface," said analyst Francisco Jeronimo from IDC.

"We will probably see good designs with a focus on touchscreen at very competitive prices, but the main question is: Have they finally fixed the user interface?"

(Reporting by Tarmo Virki; Editing by Karen Foster)

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RIM avoids BlackBerry India blackout

Mon, Aug 30 2010

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BlackBerry Torch

A man tries to hold on to his umbrella as he walks past a Blackberry advertisement billboard in Mumbai August 30, 2010. Officials meet on Monday to decide whether to ban some of Research In Motion’s BlackBerry services, a day before the deadline runs out for the firm to give security agencies access to its secure data.

Credit: Reuters/Danish Siddiqui

NEW DELHI (Reuters) - Research In Motion will give India access to secure BlackBerry data beginning September 1, a government source said on Monday, leading New Delhi to put off a decision on whether to shut down the smartphone.

Concerned about militants using the BlackBerry or Internet to plan attacks, India is also pushing RIM, Google and Skype to set up local servers to allow full monitoring of their services.

Shares of Canadian-based RIM rose after the Indian Interior Ministry said the company had offered several ways to allow authorities to monitor BlackBerry communications. The government said it would check their feasibility over the next 60 days.

New Delhi had threatened to shut down BlackBerry email services by Tuesday unless RIM provided a workable way for the government to monitor the data. India has said it wants the means to fully track and read BlackBerry communications.

Indian officials have also expressed concerns over security threats from Internet-based messaging and other services from providers such as Google and Skype.

The Indian government had set a August 31 deadline for RIM to come up with a method to allow email monitoring and avoid a shutdown in the world’s fastest-growing mobile phone market. On Monday, a source said RIM provided an interim solution.

"They have given some access, which we will operationalize from September 1," said the government source, referring to RIM.

"They will have to provide full access to all communications that go through India. They will have to set up a server in India," the source said on condition of anonymity as he was not authorized to speak to the media.

A RIM spokesman based in India said the company had no immediate comment, while a spokeswoman at Google said the company was unable to comment as it had had no communication from the government.

Skype said it had also not received any directive from authorities in India.

BLACKBERRY’S REPUTATION

BlackBerry’s reputation is built on its system security and a compromise under pressure from governments could damage the device’s popularity with business professionals and politicians.

Apple Inc and Nokia, RIM’s two biggest smartphone rivals, may have the most to gain if India blocks BlackBerry services. Nokia said on Monday it will host an email server in India from November 5.

India is keen to retain its position as one of the world’s fastest-growing information-technology nations, and a BlackBerry ban would jeopardize its status. A shutdown would also limit the efficiency and productivity of Indian businesses that rely on the smartphone.

"It is a huge hassle, not only for the government itself, which uses the RIM service," said Avian Securities analyst Matthew Thornton.

"It’s not easy to take out all of your servers, put in new servers, take out all the different devices you have in the field, put in new devices. It’s a big hassle and a cost," he said.

RIM uses powerful codes to encrypt email messages as they travel between a BlackBerry and a computer known as a BlackBerry Enterprise Server (BES) that is designed to secure those emails.

RIM has said BlackBerry security is based on a system where the customers create their own key and the company neither has a master key nor any "back door" to allow RIM or any third party to gain access to crucial corporate data.

In addition to India, several other countries, most of them in the Middle East, have raised concerns that the BlackBerry could be used to aid terrorism or peddle pornography.

Saudi Arabia, fretful over services such as online pornography, has reached a deal with RIM on access to the BlackBerry Messenger instant messaging service, a consumer product that operates outside of the secure corporate domain. India has also reached a deal until November on Messenger service, according to government sources.

Kuwait and the United Arab Emirates have raised similar concerns, with the UAE setting an October 11 deadline for RIM.

Analysts see no easy fix to the standoff as RIM says it has no way of intercepting the data that countries want to access. RIM has denied media reports that say it provided unique wireless services or access to any one country.

A shutdown would affect about 1 million users in India out of a total 41 million BlackBerry users worldwide, allowing them to use the devices only for calls and Internet browsing.

RIM’s stock was up 54 cents, or 1.2 percent, at $46.53 on Nasdaq, and up 80 Canadian cents, or 1.8 percent, at C$49.15 on the Toronto Stock Exchange on Monday afternoon.

(Writing by Krittivas Mukherjee and Frank McGurty; additional reporting by Nicole Mordant in Vancouver; editing by Surojit Gupta, Jui Chakravorty, Michael Roddy, Peter Galloway and Rob Wilson)

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(AFP/File) - A man tries out a Blackberry mobile phone in Singapore. Smartphones, like Research in Motion’s BlackBerry and Apple’s phenomenally popular iPhone, will make up over half of Asian mobile phone sales by 2015, with 477 million units likely to be sold, an industry report said.(AFP/File/Roslan Rahman)

NEW DELHI (Reuters) - India will take a final decision on August 30 on whether to block some BlackBerry services over which the country has security concerns, a senior government source said on Tuesday.

The maker of the smartphone, Canada’s Research In Motion, faces an August 31 deadline to give India the means to track and read its secure email that officials fear have the potential to be misused by militants.

The source, who is close to the negotiations with RIM, said Indian security and telecom agencies will hold "technical" meetings with the firm on Thursday and Friday for a solution.

"We are hopeful of arriving at a positive solution," the source said.

If RIM fails to comply then it would be cut out of one of the world’s fastest-growing telecoms market.

India’s security agencies are currently testing ways to access corporate email on BlackBerry devices by obtaining encrypted data in a readable format. India said last week it would allow the messenger service to continue beyond the deadline as it had been assured access to the services.

India is one of a number of countries putting pressure on RIM, which has built the reputation of the BlackBerry, popular with business professionals and politicians, around confidentiality.

Governments such as Saudi Arabia’s fear it could become a tool to plan militant attacks or for those breaking Islamic laws.

A shutdown would affect about 1 million users in India out of a total 41 million BlackBerry users worldwide, allowing them to use the devices only for calls and Internet browsing.

(Writing by Krittivas Mukherjee; Editing by Sugita Katyal)

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Bidding war in tech land

12:22pm EDT

A HP Invent logo is pictured in front of Hewlett-Packard international offices in Meyrin near Geneva August 4, 2009.

Credit: Reuters/Denis Balibouse

NEW YORK (Reuters) - Hewlett-Packard Co offered $1.6 billion for 3PAR Inc on Monday, topping technology rival Dell Inc’s deal to buy the data storage company and potentially sparking a bidding war.

HP’s move to acquire 3PAR for about one-third more than Dell’s offer comes during a rush of mergers in the technology sector, with companies taking advantage of cash stockpiles and relatively low stock market prices.

For its part, HP has been looking to expand into new businesses, with acquisitions of network device maker 3Com, tech services provider Electronic Data Systems and mobile device company Palm. It has become a giant, sprawling enterprise in the process, with more than 300,000 employees.

"3PAR will further expand our strategic footprint in storage and diversify our offerings," Dave Donatelli, head of HP’s enterprise server, storage and networking business, said on a conference call.

HP’s $24-a-share offer for 3PAR marks a 33 percent premium to last week’s bid by Dell, which the storage company’s board has approved. At the time, Dell’s bid marked an 87 percent premium to 3PAR’s share price.

HP said it was awaiting a response from 3PAR. A representative from Dell was not immediately available, and 3PAR declined to comment.

HURD FACTOR

HP, faced with turmoil in its top ranks after the resignation of Chief Executive Officer Mark Hurd, said it had been eyeing 3PAR before Dell’s public announcement last week. It said its board had approved the bid.

"This has been a methodical process," Donatelli told Reuters. "We’ve given a superior offer, and we’re confident in our business case and our proposal."

Some analysts had speculated that the absence of a permanent CEO may deter HP from dealmaking, but Donatelli said it would not be a hindrance.

"I have absolutely no concerns as it relates to this deal," he said.

Shares of 3PAR, which was founded in 1999 and posted revenue of $194 million in its last fiscal year, jumped 41.3 percent to $25.49 after the HP announcement. HP stock was down 2.6 percent at $38.80.

The competing bids for 3PAR come as technology heavyweights like International Business Machines Corp and Oracle Corp are vying to become one-stop shops for all of their customers’ technology needs, including security and storage.

In particular, such vendors have been boosting investment in "cloud computing" technology, which enables users to access data and software over the Internet and corporate networks, allowing them to save space and costs.

Some analysts said HP’s offer was surprising because Dell had offered such a steep premium, but they also raised the possibility of counteroffers.

Cross Research analyst Shannon Cross said another bidder could emerge in what would be a rare bidding war in the technology industry.

"I don’t think they are making an acquisition just to hurt Dell; this is a strategic asset," she said. "Storage is a focused area for HP as well as others, and 3PAR has a good product set."

Cross said she expected to see more acquisitions like this one.

Donatelli said HP had met with 3PAR’s senior executives and felt they would be an "excellent fit." The company offered terms that it said would be similar to those proposed by Dell, but would not include a termination fee.

HP said its proposed deal would close by the end of the year.

(Reporting by Paul Thomasch, Ritsuko Ando and Soyoung Kim; additional reporting by Franklin Paul; Editing by Lisa Von Ahn and John Wallace)

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