IPhone Hurts Nokia And AT&T

Nokia (NOK) remains by far the world's No. 1 cell phone maker, but it's getting tossed about by Apple (APPL) and Android in the smart-phone market, so it's aiming to reinvent.

AT&T (T) also is moving into a new phase. Its standing as the exclusive U.S. service provider for Apple's iPhone ends on Feb. 10, when archrival Verizon Wireless starts offering the device.

Both Nokia and AT&T released disappointing Q4 results and outlooks early Thursday as they prepare for changes. Nokia shares fell 1.6% while AT&T fell 2.1%.
In a conference call with analysts after Nokia posted results, CEO Stephen Elop spoke of changes.

"Nokia faces some very significant challenges," he said. "The game has changed from a battle of devices to a war of ecosystems," referring to the convergence of mobile and computing devices surrounded by apps and other services.

Apple, with its iPhone, iPad and iPod line of products tethered to its iTunes services and App Store, is the best-performing ecosystem. But devices based on Google's (GOOG) Android operating system also are in the game, as are BlackBerry maker Research In Motion (RIMM) and others.
Though it beat Q4 earnings and revenue views, its Q1 outlook lagged. For the quarter, Nokia reported revenue of 12.6 billion euro, or $17.3 billion, up 6% and above expectations for 12.4 billion euro. Earnings fell 23% to 0.20 euro, or 27.5 cents, above views for 0.16 euro.
This quarter, Nokia expects sales of mobile devices and services — which accounted for 67% of revenue in Q4 — to be 6.8 billion to 7.3 billion euro.