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COMPANY PROFILE

The telephone network is one global device: probably the biggest and most complicatedmachine on the planet. Despite its ubiquity, it is a fairly recent invention.

The telephone initially developed using the technology designed for the telegraph (invented

by Wheatstone and Morse in 1837). It started out as a manually-switched network (the first

telephone exchange was able to handle a whole 21 lines, and was installed in 1878).

Alexander Graham Bell patented the telephone in 1876, though there remains some dispute

about whether the inventor's glory should really go to Elisha Grey, whose similar patent was

only filed an hour or so later. There is some suggestion the crucial scribbled addendum

'variable resistance' in the margin of Bell's patent may have come from Grey's work.

In the next year, 1877, Western Union turned down an offer of the patent rights for the

telephone for $100,000. A few years later, they had realised their mistake, and offered

$25,000,000, but Bell refused to sell.

That same year, Thomas Edison demonstrated the phonograph. He had developed it as part of

a telephone call transcription service, so that telephone messages could be delivered bytelegraph: an early form of the emerging voice message to messaging services being offered

today!

Calls were connected by operators. An American undertaker, Almon Strowger, discovered

that the local telephone operators were unfairly connecting callers who asked for an

undertaker to his rivals, so he decided to design an automatic telephone switchboard!

The first Stronger electro-mechanical automatic exchange went live in 1897, although in

Britain it took another 70 years before all subscribers were connected to automatic

exchanges.

Modern telephone exchanges are really more like specialist computers, and there are fewer

and fewer of them around: the intelligent parts of the switching are done in fewer, larger

units.



What t house a telephone exchange now onl hol s a "concent ator" where telephone

lines are connected to the network.

HISTORY OF NOKIA

Alexandra Techno Park in Singapore, Nok ia's regional corporate headquar ters is a base from

which over 650 staff provides leading-edge technology, product and solutions to the 20

diverse markets and Nok ia off ices in the Asia-Pacif ic region.

Nok ia Mobile Phones currently manufactures products out of three major facilities in Masan,

Korea; and Beijing and Dongguan in China. Nok ia has R&D centers in Japan and China, and

an industr ial park in Xingwang, Beijing with R&D and manufactur ing facilities.

Nok ia Networks has technology and training centers in Australia, Japan and Thailand, as well

as six joint ventures in China.

Nok ia Research Center, the corporate research unit, has off ices in Japan and China.

Nok ia Ventures Organizations' operation in the region includes Nok ia Internet

Communications and Nok ia Home Communications.

Nok ia is a wor ld leader in mobile communications, dr iving the growth and

sustainability of the broader mobility industry. Nok ia connects people to each other and

the information that matters to them with easy-to-use and innovative products like

mobile phones, devices and solutions for imaging, games, media and businesses. Nok ia

provides equipment, solutions and services for network operators and corporations.



Nok ia is a broadly held company with listings on four major exchanges.

From its inception, Nok ia was in the communications business as a manufacturer of

paper - the or iginal communications medium. Then came technology with the founding

of the Finnish Rubber Works at the turn of the 20th century.

Rubber, and associated chemicals, were leading edge technologies at the time. Another

major technological change was the expansion of electr icity into homes and factor ies

which led to the establishment of the Finnish Cable Works in 1912 and, quite naturally,

to the manufacture of cables for the telegraph industry and to suppor t that new-fangled

device - the telephone!

Af ter operating for 50 years, an Electronics Depar tment was set up at the Cable Works

in 1960 and this paved the way for a new era in telecommunications. Nok ia Corporatio

was formed in 1967 by the merger of Nok ia Company - the or iginal paper-mak ing

business - with the Finnish Rubber works and cable works.

Design has always been impor tant atNok ia and today's mobile phones are regarded as a

benchmark for others to follow. Take, for example, multi-coloured, clip-on facias which

turned mobiles into a fashion item overnight.

But Nok ia has always thought like that and back in the fashion-conscious 1960's when

one branch of the corporation was a major rubber manufacturer, it hit on the idea of

mak ing br ightly-coloured rubber boots at a time when boots followed the Henry Ford

pr inciple - you could have any colour, so long as it was black!

The '60s, however, were more impor tant as the star t of Nok ia's entry into the



telecommunications market. A radio telephone was developed in 1963 followed, in

1965, by data modems - long before such items were even heard of by the general

public.

In the 1980's, everyone looked to micro computers as the next 'big thing' and Nok ia

was no exception as a major producer of computers, monitors and TV sets. In those

days, the prospect of High Def inition TV, satellite connections and teletext services

fuelled the imagination of the fashion conscious homeowner.

In the background, however, changes were afoot. The wor ld's f irst international

cellular mobile telephone network, NMT, was introduced in Scandinavia in 1981 andNok ia made the f irst car phones for it.

True enough, there were 'transpor table' mobile phones at the star t of the '80's but they

were heavy and huge. Nok ia produced the or iginal handpor table in '87 and phones

have continued to shr ink in inverse propor tion to the growth of the marketever since.

It took a technological break through and a change in the political climate to create

the wire-free wor ld people are increasingly demanding today. The technology was

the digital standard, GSM, which could carry data in addition to high quality voice.

In 1987, the political goal was set to adopt GSM throughout Europe on July 1st

1991. Finland met the deadline, thanks to Nok ia and the operators.

Politics and technology have continued to shape the industry. The '80s and '90s saw

widespread deregulation which stimulated competition and customer expectations.

Nok ia changed too and in 1992 Jorma Ollila, then President of Nok ia Mobile Phones,

was appointed to head the entire Nok ia Group. The corporation divested the non-



core operations and focused on telecommunicat ions in the Digital Age.

Few people in the early '90s would have thought that 'going digital' would change

ings so much.

2001 and into the Future

Nokia is harnessing its experience in mobility and networks to generate a startling

vision of the future. Meeting rooms, offices and homes will be 'smart' enough to

recognise their human visitors and give them whatever they want by listening to their

requests.

Nokia welcomes change and improvement and can embrace new ideas at great speed.

Such characteristics will never change but, as to the rest, the story has only justbegun!

Some firsts for Nokia in India

1995 ± First mobile phone call made in India on a Nokia phone on

a Nokia network

1998 - Saare Jahaan Se Acchha, first Indian ringtone in a Nokia

5110

2000 - First phone with Hindi menu (Nokia 3210)

2002 - First Camera phone (Nokia 7650)

2003 - First Made for India phone, Nokia 1100

2004 - Saral Mobile Sandesh, Hindi SMS on a wide range of Nokia

phones



2004 - First Wi-fi Phone- Nokia Communicator (N9500)

2005 ± Local UI in additional local language

2006 ± Nokia manufacturing plant in Chennai

2007 ± First vernacular news portal

Devices business

Nokia has established itself as the market and brand leader in the

mobile devices market in India. The company has built a diverse

product portfolio to meet the needs of different consumer

segments and therefore offers devices across five categories ie.

Entry, Live, Connect, Explore and Achieve. These include products

that cater to first time subscribers to advanced business devices

and high performance multimedia devices for imaging, music and

gaming. Nokia has been working closely with operators in India to increase

the geographical coverage and lower the total cost of ownership

for consumers. Today, Nokia has one of the largest distribution

network with presence across 1,30,000 outlets. In addition, the

company also has Nokia Priority Dealers across the country and

Nokia µConcept stores¶ in Bangalore, Delhi, Jaipur, Hyderabad,

Chandigarh, Ludhiana, Chennai, Indore and Mumbai to provide

customers a complete mobile experience.



Services business

With the global launch of Ovi, the company's Internet services

brand name, Nokia is renewing itself to be at the forefront of the

Convergence of internet and mobility. From being a product

Centric company, Nokia is now focusing to become solutions

Centric. The strategic shift is built on Nokia¶s bid to retain

consumers and empower Nokia device owners to realise the full

potential of the Internet. Nokia will build a suite of Internet based

services like Nokia Maps, the Nokia Music Store and Nokia N-Gage

around its Ovi brand.

Infrastructure business

Nokia Siemens Networks is a leading global enabler of

communications services. The company provides a complete,

well-balanced product portfolio of mobile and fixed network

infrastructure solutions and addresses the growing demand for

services with 20,000 service professionals worldwide. Its

operations in India include Sales & Marketing, R esearch &

Development, Manufacturing and Global Networks Solutions Centre. Headquartered in

Gurgaon, Nokia Siemens Networks has

47 offices and presence in over 170 locations across the country



R & D centers

Nokia has three R esearch & Development centers in India, based

in Hyderabad, Bangalore and Mumbai. These R &D hubs are

staffed by engineers who are working on next-generation packetswitched mobile

technologies and communications solutions to

enhance corporate productivity. The Center in Bangalore, the biggest R &D site in the

country comprises S60 Software Organi ation, Common Technologies, Next

Generation now called Maemo Software, Producti ation and Software & Services.



BOARD OF DIRECTORS

Nokia Board of Directors consists of the following nine members: Lalita D. Gupte,

Bengt Holmström, Henning Kagermann, Per Karlsson, Isabel Marey-Semper, Jorma

Ollila, Mar jorie Scardino, R isto Siilasmaa and Keijo Suila.

Chairman

-Jorma Ollila

Vice Chairman

-Dame Mar jorie Scardino

-Lalita D. Gupte

-Dr. Bengt Holmström

-Dr. Henning Kagermann

-Per Karlsson

-Isabel Marey-Semper

-R isto Siilasmaa

-Keijo Suila

The operations of the company are managed under the direction of the Board of

Directors, within the framework set by the Finnish Companies Act and our Articles of

Association as well as any complementary rules of procedure as defined by the Board,

such as the Corporate Governance Guidelines and related Board Committee charters.



ORGANISATION CHAR T

Our organi ational structure is designed to position us for a world where the mobile

device, the Internet and the computer are fusing together.

Mobile Solutions is responsible for developing and managing our portfolio of

smartphones and mobile computers. The team is also busy developing a world-class

suite of internet services under the Ovi brand, with a strong focus on maps and

navigation, music, messaging and media. Mobile Phones is responsible for developing

and managing our portfolio of affordable mobile phones, as well as a range of services

that people can access with them.Markets manages our supply chains, sales channels,

brand and marketing activities, and is responsible for delivering our mobile solutions

and mobile phones to the market.

Nokia Siemens Networks, jointly owned by Nokia and Siemens, provides wireless and

fixed network infrastructure, communications and networks service platforms, as well

as professional services to operators and service providers.

NAVTEQ is a leading provider of comprehensive digital map data and related location-

based content and services for automotive navigation systems, mobile navigation

devices, Internet-based mapping applications, and government and business solutions



OPERATIONAL STRUCTURE

This new strategy is supported by significant changes in Nokia's leadership, operational

structure and approach. Effective today, Nokia has a new leadership team with the

commitment, competencies and innovative thinking needed in today's dynamic environment.

The Nokia Leadership Team, previously the Group Executive Board, will consist of the

following members: Stephen Elop, Esko Aho, Juha Akras, Jerri DeVard, Colin Giles, R ich

Green, Jo Harlow, Timo Ihamuotila, Mary McDowell, Kai Oistamo, Tero Ojanpera, Louise

Pentland and Niklas Savander.

Alberto Torres has stepped down from the management team, effective February 10 to pursue

other interests outside the company.

The renewed governance will expedite decision-making and improve time-to-market of

products and innovations, placing a heavy focus on results, speed and accountability. The

new strategy and operational structure are expected to have significant impact to Nokia

operations and personnel.

MOBILE PHONES

Mobile Phones makes user-friendly mobile devices with many features for different segments

of the global market. We seek to put consumers first in our product creation process and

primarily target high-volume category sales. Mobile Phones currently offers mobile phones

and devices based on the following global cellular technologies: WCDMA, In voice-centric

and mainstream mobile phones, we believe that design, ease of use and price are our

customers' most important considerations. Increasingly, our product portfolio includes new

features and functionality designed to appeal to the mass market, such as cameras, Java,

MMS and XHTML browsers.



.



NOKIA ACCESSORIES



. THE MOBILE DEVICE MARKET

On a global level 94 million smartphones were shipped in the last 3 months of 2010, that¶s

75 percent more than in the same period for 2009, according to Strategy Analytics. Out of all

the phones shipped in Q4, 24 percent of those were smartphones, this leads to an impressive

number for the whole statistic as over 400 million units were shipped during this last quarter

which showed a growth of 16 percent compared to the same period in 2009. The number one

position was held still by Nokia, which shipped 123.7 million handsets this last year, a

number smaller by 3 percent when compared with 2009 which in turn was 3 percent smaller

than in 2008.

While Symbian, from Nokia¶s stable, might still be the top mobile operating system (O/S)

worldwide but its market leadership is surely on wane as the latest data from data analysis

agency, StatCounter shows. Symbian¶s global market share stood at 30.25%, as on January

31, 2011, down from 34.16% a year ago. It is followed by Apple¶s iOS at the number 2 spot

with a market share of 25%, down from 33.13% in January 2010. And guess who won at the

cost of these two players. While, it may not take much for you to suggest that it¶s Google¶s

Android, there is another surprise winner in Blackberry, of course the gain was comparatively

much substantial in case of the former (i.e., Android). Android grew its market share from a

meager 4.54% in January 2010 to nearly 15% (14.61% to be precise) while Blackberry¶s O/Sadded 475 basis points to take its tally to 15.03% in January 2011 from 10.28%, a year ago.



Market share in India

Nokia losing market share is no big news, but its a big news when the story is happening in

India or any other emerging market, where Nokia always had a strong hold.

According to a report by IDC India on the growth of mobile sales in India (for 2009) and

some of the key numbers from the report were:

Nokia market share in India fell from 56.2% share in 2008 to 54.1% in 2009.

Local players have grabbed 17.5% market share [from 0.9%, a year back]

Only 5 local manufacturers in 2008 and the number stands at 28 now!

Samsung¶s share rose marginally to 9.7% from 9.5%

The data has stirred Nokia to angry responses: Its managing director in

India noted the firm "continues to do well" in all market segments in India, before

commenting that IDC's stats seemed to concern shipments of phones rather than

actual sales. He even remarked that Nokia's own estimates of the dual-SIM market

share was a much lower 22%. We know Nokia's been aggressively targeting rural

customers in India, who make up about a quarter of the market, and has even set up

a factory there in the last decade.

And Nokia is facing another significant threat: Apple. We're aware that the prevailing

opinion is that Nokia's grip has slipped off the cutting edge of smartphone design,

and as smartphones assume the central position in the future of cell phon e tech,

Nokia may already be too late to catch up to the lead set by Apple and Google. Now

there are increasingly concrete rumors Apple will make a CDMA version of the

iPhone to satisfy the U.S.'s leading provider Verizon. And CDMA networks are also

highly popular in India, offering access to potentially tens of millions of subscrib ers--

other rumors are already suggesting Apple's going to target these consumers.

India's 30,000 crore-a-year mobile handset market witnessed a skirmish between two big

global names on Tuesday, with market leader Nokia disputing figures from influential

research firm IDCthat showed its hold over the domestic market was weakening ² and at an

alarming pace.



IDC, whose data are closely tracked around the world, said Nokia's share of the Indian

handset market ² its second biggest after China ² plunged to 36.3% at the end of June from

54% at the end of 2009, providing the Finnish giant's critics more proof of its failure to keep

pace with rapidlychanging customer preferences.

CHAR T SHOWING MARKET SHARE OF SMAR TPHONES AS OF 4TH

QUATER-2010

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