Round table with Anssi Vanjoki, Vice President of Nokia

In mid-December, Nokia Executive Vice President Anssi Vanjoki, who is also Head of Nokia Markets, arrived in Russia. The meeting was attended by a dozen journalists from different publications, so the questions are diverse, some are naive, some are ridiculous, for example, about a billion dollars in debt from Russian distributors. Nevertheless, the round table provides an opportunity to assess the direction in which the company will develop, to some extent shows the events from the inside, from Nokia's point of view. Let's start with Anssi's greetings:

If we look at the current world, we will see that it is not going through the best of times, and the financial crisis that began a few months ago has spread to almost all sectors of the economy, this is happening in the field of telecommunications, although I would rather said in the field of Internet technologies, which today is experiencing difficulties with further development.

But if we look at the trend that is now gaining momentum around the world, this is the widespread penetration of the Internet into the daily life of every person, and the next stage of development that we have already entered involves the development of the Internet towards mobile technologies and contextual services , and we hope that Nokia will become one of the leading players in determining what this industry will look like in the future.

That's why we're launching a range of new products that are more computers than mobile phones, but we're not going to abandon the mobile market either. In a country like Russia, in our opinion, the full potential for the penetration of mobile phones has not yet been exhausted. We are also optimistic about the rapid development of 3G networks in this region and hope that they will soon appear in Moscow.

And if we look at the most discussed topics today, it is undoubtedly the launch of the Nokia 5800 XpressMusic in Russia, which was the first market where we started selling this phone, and at the moment everything indicates an unprecedented demand from buyers for this model .

Just a week ago, we launched another product on the market that brought even closer to the idea of ​​mobile convergence - Nokia N97; in essence, Yeshurab Kemis is a portable computer that has the power to change the consumer's perception of mobile devices in in general.

From Nokia's point of view, entering the Internet services market and moving it towards contextuality is a very interesting opportunity, and this segment is growing rapidly. In terms of geography, we have high hopes for Russia, even in today's economic climate, we will continue to expand our presence here and in every possible way contribute to the development of this market from mobile telephony to a much larger Internet services market.

Actually, that's all I wanted to say as an introduction to our discussion, and now the floor is up to you.

Eldar Murtazin: Sales of the 5800 in Russia are really amazing - the phone has already broken several records in this market. However, its popularity created the conditions for a massive leak of phones from the Russian market to other countries, where interest in the new product is also great. Is there any estimate of the number of devices taken from Russia?

E.M. How soon will Nokia be able to ramp up production of the 5800? As of today, you are facing a serious shortage of the device around the world, and it seems that it is not possible to cope with the situation yet.

AB We have a very large production capacity under the 5800, and we were aware at the very beginning of sales that this device would become very popular, but as you can see, the reality surpassed all our the wildest expectations, this is the main reason for the shortage. Also, don't forget that it usually takes 12 weeks from the moment a new device is launched to reach peak production volumes, in the case of the 5800, only four are in production, so we expect a significant increase in the number of phones produced already in the first quarter of 2009. As for Russia, the number of phones shipped will grow exponentially over the next few weeks.

E.M. Do you expect 5800 sales to remain at the same level in January as the Christmas shopping season ends?

A.B. We have already discussed this issue this morning, and, obviously, immediately after the New Year, we should expect a decrease in activity in the market. In our opinion, the market will continue to fall in the first quarter, and upon reaching the bottom, it will gradually start to become more active again. It's nice to know that Nokia is in a very good position in this regard - we already have the 5800, as well as a number of other interesting solutions that we hope to release next year.

E.M. Returning to the topic of the financial crisis, will the changed market conditions force you to reconsider your plans for the near future and market strategies, perhaps cancel some initiatives?

A.B. In fact, during the economic crisis, you can not slow down, on the contrary, you need to make every effort to release products and services on time. We at Nokia will try to do everything possible to prevent the disruption of the timing of the release of certain offers, not to mention their cancellation. During such periods, market leaders are formed, and we, in turn, would very much like to be among them.

E.M. Do you know which market the N97 will hit first?

A.B. Yes, I'm aware of that, but I wouldn't want to expand on it just yet. At the same time, I believe that we still need to fully explore and weigh the full potential of the N97, ultimately, this is not just another new phone, but a completely new concept that carries a whole range of services created by both Nokia and third-party developers. As you can see now, there is still a lot of empty space on the N97's home screen for future widgets and applications, I assure you, by launch they will all be occupied by both services and built-in functions. Therefore, we will need to evaluate the readiness of related services in various markets, and only then can we finally decide on the market in which the initial launch of the N97 will take place.

E.M. Over the past few years, Nokia has made great efforts to market some of its products in the US market. Will your strategy change in any way, taking into account the adjustments made by the financial crisis?

AB I believe that we will continue with our previous policy, although we will have to slightly accelerate our development in the US - we have already invested a significant amount of funds in our own center in San Diego, which will develop solutions exclusively for the US market. Moreover, we are already working on separate devices for Verzion and AT&T.

E.M. Was Nokia's experience with AT&T successful (particularly with the 6555 phone)? You initially announced that this product was made specifically for the US market, but AT&T did not talk about significant sales, and subsequently the phone was released to the global market.

AB I think we're doing pretty well in the US market, and the fact that we've decided to make this phone available in the rest of the markets just shows that we've seen additional opportunities in similar behavior, that's all.

E.M. A huge number of counterfeit phones like Nokla first come to the east of Russia, then move to the west and eventually end up in Europe. Is Nokia trying to wage an information war against such products?

A.B. The surest way to counter fakes is to expand your presence in the regions where such devices are produced, as well as to close such manufacturers in court. In general, we do not believe that campaigns can have a comparable effect.

E.M. So far, all the questions have been about phones, but at the same time, Nokia has recently positioned itself as an Internet company. I would like to hear how you assess the success of these initiatives, in particular, the OVI service?

A.B. To begin with, it's worth noting that Nokia's service strategy is not new at all - we've been moving towards it for many years, and all this work materialized in the form of an announcement that we made almost a year ago. Since then, we have been doing our best to implement all the services we envisioned and make them easy to use. And I would like to note that today we are ahead of our schedule, which was laid down a year ago. The most popular service at the moment is Navigation, we have implemented it on a number of devices that cover a large number of local markets. In addition, we have invested heavily in NavTeq, the world's leading electronic charter, and for us, NavTeq is not just an opportunity to expand the navigation component of our devices, but also a whole platform with which we can literally coordinate the whole world.

E.M. It's no secret that OVI is focused on the Western market, because often its services do not have localization or, let's say, some of them only support already established networks (flickr, etc.), hence the serious problem of the language barrier arises. Are there any joint steps planned with Russian providers and service providers in this direction? Are there already any ready-made solutions for local markets?

A.B. The thing that sets Nokia apart from all other Internet service players is our ubiquitous physical presence. Other companies also distribute their services around the world, but virtually. Therefore, one of the key components of our strategy is the localization of services and solutions. We have serious intentions related to bringing our services to local markets, but we must do it gradually - in 2009 you can already see some progress in this direction (for example, Nokia Music Store will be available in Russia in the first half of 2009 ), and, of course, we plan to launch a localized version of OVI on the Russian service market.

However, today the key task is to debug international versions of services and fix errors and shortcomings in the system itself. It is also worth noting that we have already received the first results - N-Gage ranks fifth in the world in terms of the number of downloaded games, and we hope that it will soon enter the top three. And this is despite the fact that the service itself was launched only in October this year.

In 2009, we will begin to pay more attention to partnership deals with Russian service operators and application developers. I repeat, now we are working on debugging the service functioning system itself, so we still have a lot of work to do before localization.

E.M. Today, there are already established communities (in the field of blogging, sharing photos, etc.) around old projects, and it makes no sense for their users to switch to something new, but with the same functions. In a crisis, Internet companies become cheaper, especially in emerging markets, and they can be bought for reasonable money, thereby expanding their presence in the market. Are you considering such opportunities?

A.B. In our development strategy for OVI, we see it as a complete platform for mobile access to all the services that the user needs. I tend to call it "all in one" - on the one hand, we have our own Nokia services, but we also work with companies like YouTube, flickr, etc. Moreover, all these services can be safely used with our devices. And in this regard, we do not exclude the possibility of cooperation with local service providers in order to further enrich the platform. Ultimately, our goal is to provide users with access to all the services and capabilities they need, and in this sense, OVI is exactly a platform open to new opportunities.

E.M. Nokia differs from other manufacturers in a large number of concept models, is it possible to somehow calculate the percentage of those solutions that are actually implemented in practice? Recently, Nokia introduced the concept of a nanotube phone (Nokia Morph), is this concept planned to be implemented and if so, when?

AB If we look at the cycle that ideas go through at Nokia, I would say that out of 100 ideas, only two survive: first we collect information and concepts, some of them are already eliminated at this stage as the least feasible, then we evaluate the complexity of development and production and, finally, the ways of technology commercialization. As a result, there are no more than 2% of ideas that meet all our criteria, which is very, very small. If we talk about more global things, such as Morph, then they are based on very real technologies that can be implemented. Of course, I can't even give an approximate date for the release of such a device, or even the time when nanotechnology will provide us with the means to implement it. But I would say that if nothing happens to me, then by old age I will already have a phone like Morph.

E.M. At this stage of development of the telephone industry, are nanotechnologies already being used or are they planned to be used?

A.B. The first area likely to be touched by nanotechnology will be power supplies and conductors - now we need to provide longer battery life, make phones lighter, more energy efficient. In general, there are many reasons and applications for nanotechnology in the construction of phones, but batteries will most likely be our first step in this direction.

E.M. Does the launch of touch screen devices mean the end of Nokia's internet tablet line?

A.B. Definitely not. We've been familiar with touchscreen technology for a long time because we were actually the first company to introduce such a device (7710). And in fact, Internet tablets are by no means a dying type of device; on the contrary, they are our future. When I announced these devices, I mentioned that it would take at least five generations of devices before they become truly mainstream. At the moment, there are already three generations on the market, the fourth is under development and is based on the Maemo platform, written specifically for touch devices, which is a very important advantage.

E.M. What are Nokia's plans for the further development of touch technologies? Is there a chance that they will go beyond Series 60 in the near future, for example to Series 40? Will we see very cheap $200 touchscreen devices?

A.B. In terms of software platforms, Nokia focuses on three projects around which our service ecosystem is built - Series 60, Series 40 and Maemo. While we are going to introduce some services for the Series 40 as well, in terms of interface development these devices have always been more phones than mobile computers, and therefore we have serious doubts about the real usefulness of touch displays in phones built on Series 40. Ultimately, this technology is oriented more towards the use of various services, such as the N97 and its widgets. In our vision, Series 40 should have a fairly limited set of services, while Series 60 will be our main platform in this regard, however, as well as Maemo.

E.M. You mentioned that nanotechnology will affect battery performance. But when and how will they affect phone design? If not, what new solutions can we expect from Nokia in terms of design and materials?

A.B. When it comes to design, there are 3 key components: the design of the phone itself, materials and software, coupled with ease of use. These three elements must be in harmony in every serious product. The N97 is a great example - the opening mechanism that we have applied in it provides unparalleled strength and at the same time the convenience of the design. As for nanotechnologies, they will, in particular, make it possible to significantly lighten phones, as well as to create exceptionally strong and thin materials, naturally, they can find many applications in design. Finally, on the software side, we are working on a number of cross-platform features in this aspect, such as widgets on the N97.

E.M. What is your sales forecast for 2009?

A.B. Last week we had a Capital Markets Day in New York where we discussed various aspects of our financial situation and made some forecasts for the coming year. In general, we expect sales to fall by 5% compared to the current year, however, nothing more can be said, it is very difficult to make long-term forecasts now.

E.M. A few years ago, when Nokia first introduced the idea of ​​internet tablets, you had no competition, maybe Sony and Archos, but that's all. However, today the so-called netbooks, which are aimed at the same audience as your products, have become especially widespread. Are you afraid of competition from their side?

AB Firstly, I think that the very fact of the appearance of such devices indicates that we are moving in the right direction and that we have relied on precisely those devices that will form in the near future the whole market. But speaking specifically about these mini laptops… they really are bad laptops! They have very limited functionality, and they do not have the same service and contextual capabilities as our mobile solutions. Therefore, I am absolutely calm about the competition with these under-laptops. Moreover, we have been investing in the development of Maemo for quite a long time, a platform that will become the main platform for truly mobile devices with the richest service capabilities. Netbooks are convenient for the conditions in which we are now, but nothing more. This is just another fashion trend this year, and many people who bought such devices have already become deeply disappointed in them.

E.M. Today's Internet environment is largely built around search technology - is Nokia planning to introduce more sophisticated search algorithms and new features in this area?

AB There are many players in the market who started back in the early days of the Internet, such as Google and Yahoo, but I can't say that we are late to this market, we just started our development from another starting point. And speaking of search, modern search engines aren't all that complicated, it all comes down to just indexing anything and everything. We pay more attention to the social interactions of users, the relevance of data, their connection. Therefore, our real goal is to create a truly intelligent search algorithm that will take into account all these parameters, as well as your location, and produce results that are semantically meaningful for the person who uses it. Naturally, such technologies are only looming somewhere in the future, but we are investing heavily in this area, and our goal, as I mentioned earlier, is to coordinate and connect users, and this requires more than just web indexing -pages; in fact, we need to connect a person's life in the real world and his life on the Web.

E.M. There have recently been rumors that the total debts of Nokia's Russian distributors amount to about a billion dollars. How can you comment on this? In addition, how will the Dixis bankruptcy procedure affect Nokia's operations in Russia? Also last week, reports began to appear that Nokia had stopped deliveries of phones for one of the largest Russian retailers, is this true?

A.B. I could excuse myself with our standard response that we don't comment on rumours, but on the issue of debt, I would like to point out the following. Nokia is not a bank, we are a commercial organization and we are glad to see among our partners only those companies that care about their business and their debts. Besides, if someone owed us a billion, we would not be sitting in this restaurant! (laughs). In general, the financial side of our business is in good shape, although, of course, some things will change in 2009 due to the financial crisis.

Nokia is very well represented in Russia, and we would like to further increase our presence and weight in this market, so we will certainly continue to work with all the major players.

Round table with Anssi Vanjoki, Vice President of Nokia

In mid-December, Nokia Executive Vice President Anssi Vanjoki, who is also Head of Nokia Markets, arrived in Russia. The meeting was attended by a dozen journalists from different publications, so the questions are diverse, some are naive, some are ridiculous, for example, about a billion dollars in debt from Russian distributors. Nevertheless, the round table provides an opportunity to assess the direction in which the company will develop, to some extent shows the events from the inside, from Nokia's point of view. Let's start with Anssi's welcome words:

If we look at the current world, we will see that it is not going through the best of times, and the financial crisis that began a few months ago has spread to almost all sectors of the economy, this is happening in the field of telecommunications, although I would rather said in the field of Internet technologies, which today is experiencing difficulties with further development.

But if we look at the trend that is now gaining momentum around the world, this is the widespread penetration of the Internet into the daily life of every person, and the next stage of development that we have already entered involves the development of the Internet towards mobile technologies and contextual services , and we hope that Nokia will become one of the leading players in determining what this industry will look like in the future.

That's why we're launching a range of new products that are more computers than mobile phones, but we're not going to abandon the mobile market either. In a country like Russia, in our opinion, the full potential for the penetration of mobile phones has not yet been exhausted. We are also optimistic about the rapid development of 3G networks in this region and hope that they will soon appear in Moscow.

And if we look at the most discussed topics today, it is undoubtedly the launch of the Nokia 5800 XpressMusic in Russia, which was the first market where we started selling this phone, and at the moment everything indicates an unprecedented demand from buyers for this model .

Just a week ago, we launched another product on the market that brought even closer to the idea of ​​mobile convergence - Nokia N97; in essence, Yeshurab Kemis is a portable computer that has the power to change the consumer's perception of mobile devices in in general.

From Nokia's point of view, entering the Internet services market and moving it towards contextuality is a very interesting opportunity, and this segment is growing rapidly. In terms of geography, we have high hopes for Russia, even in today's economic climate, we will continue to expand our presence here and in every possible way contribute to the development of this market from mobile telephony to a much larger Internet services market.

Actually, that's all I wanted to say as an introduction to our discussion, and now the floor is up to you.

Eldar Murtazin: Sales of the 5800 in Russia are really amazing - the phone has already broken several records in this market. However, its popularity created the conditions for a massive leak of phones from the Russian market to other countries, where interest in the new product is also great. Is there any estimate of the number of devices taken from Russia?

Anssi Vanjoki: When we prepare to launch a product, we choose one to three primary markets where we think we can achieve the greatest impact. That is why we brought the 5800 to the Russian market first; and although we put here all the devices that were produced at that time, the interest in the new product exceeded all our expectations, and we even had to slightly delay its release to other markets. However, today everything has returned to normal, the phone is already on sale in Spain and Hong Kong, and, according to our data, it is no less successful there. In fact, everything we have delivered has already been swept off the shelves, so now we are trying to ramp up production as soon as possible.

With regard to the gray market, of course, when a product only appears in select markets, there is always the possibility of speculation, but in the case of the 5800, we do not see this as a serious threat. Starting from the first months of 2009, we will be introducing the phone to other markets, so there is no concern about leaks of devices.

E.M. How soon will Nokia be able to ramp up production of the 5800? As of today, you are facing a serious shortage of the device around the world, and it seems that it is not possible to cope with the situation yet.

AB We have a very large production capacity under the 5800, and we were aware at the very beginning of sales that this device would become very popular, but as you can see, the reality surpassed all our the wildest expectations, this is the main reason for the shortage. Also, don't forget that it usually takes 12 weeks from the moment a new device is launched to reach peak production volumes, in the case of the 5800, only four are in production, so we expect a significant increase in the number of phones produced already in the first quarter of 2009. As for Russia, the number of phones shipped will grow exponentially over the next few weeks.

E.M. Do you expect 5800 sales to remain at the same level in January as the Christmas shopping season ends?

A.B. We have already discussed this issue this morning, and, obviously, immediately after the New Year, we should expect a decrease in activity in the market. In our opinion, the market will continue to fall in the first quarter, and upon reaching the bottom, it will gradually start to become more active again. It's nice to know that Nokia is in a very good position in this regard - we already have the 5800, as well as a number of other interesting solutions that we hope to release next year.

E.M. Returning to the topic of the financial crisis, will the changed market conditions force you to reconsider your plans for the near future and market strategies, perhaps cancel some initiatives?

A.B. In fact, during the economic crisis, you can not slow down, on the contrary, you need to make every effort to release products and services on time. We at Nokia will try to do everything possible to prevent the disruption of the timing of the release of certain offers, not to mention their cancellation. During such periods, market leaders are formed, and we, in turn, would very much like to be among them.

E.M. Do you know which market the N97 will hit first?

A.B. Yes, I'm aware of that, but I wouldn't want to expand on it just yet. At the same time, I believe that we still need to fully explore and weigh the full potential of the N97, ultimately, this is not just another new phone, but a completely new concept that carries a whole range of services created by both Nokia and third-party developers. As you can see now, there is still a lot of empty space on the N97's home screen for future widgets and applications, I assure you, by launch they will all be occupied by both services and built-in functions. Therefore, we will need to evaluate the readiness of related services in various markets, and only then can we finally decide on the market in which the initial launch of the N97 will take place.

E.M. Over the past few years, Nokia has made great efforts to market some of its products in the US market. Will your strategy change in any way, taking into account the adjustments made by the financial crisis?

AB I believe that we will continue with our previous policy, although we will have to slightly accelerate our development in the US - we have already invested a significant amount of funds in our own center in San Diego, which will develop solutions exclusively for the US market. Moreover, we are already working on separate devices for Verzion and AT&T.

E.M. Was Nokia's experience with AT&T successful (particularly with the 6555 phone)? You initially announced that this product was made specifically for the US market, but AT&T did not talk about significant sales, and subsequently the phone was released to the global market.

AB I think we're doing pretty well in the US market, and the fact that we've decided to make this phone available in the rest of the markets just shows that we've seen additional opportunities in similar behavior, that's all.

E.M. A huge number of counterfeit phones like Nokla first come to the east of Russia, then move to the west and eventually end up in Europe. Is Nokia trying to wage an information war against such products?

A.B. The surest way to counter fakes is to expand your presence in the regions where such devices are produced, as well as to close such manufacturers in court. In general, we do not believe that campaigns can have a comparable effect.

E.M. So far, all the questions have been about phones, but at the same time, Nokia has recently positioned itself as an Internet company. I would like to hear how you assess the success of these initiatives, in particular, the OVI service?

A.B. To begin with, it's worth noting that Nokia's service strategy is not new at all - we've been moving towards it for many years, and all this work materialized in the form of an announcement that we made almost a year ago. Since then, we have been doing our best to implement all the services we envisioned and make them easy to use. And I would like to note that today we are ahead of our schedule, which was laid down a year ago. The most popular service at the moment is Navigation, we have implemented it on a number of devices that cover a large number of local markets. In addition, we have invested heavily in NavTeq, the world's leading electronic charter, and for us, NavTeq is not just an opportunity to expand the navigation component of our devices, but also a whole platform with which we can literally coordinate the whole world.

E.M. It's no secret that OVI is focused on the Western market, because often its services do not have localization or, let's say, some of them only support already established networks (flickr, etc.), hence the serious problem of the language barrier arises. Are there any joint steps planned with Russian providers and service providers in this direction? Are there already any ready-made solutions for local markets?

A.B. The thing that sets Nokia apart from all other Internet service players is our ubiquitous physical presence. Other companies also distribute their services around the world, but virtually. Therefore, one of the key components of our strategy is the localization of services and solutions. We have serious intentions related to bringing our services to local markets, but we must do it gradually - in 2009 you can already see some progress in this direction (for example, Nokia Music Store will be available in Russia in the first half of 2009 ), and, of course, we plan to launch a localized version of OVI on the Russian service market.

However, today the key task is to debug international versions of services and fix errors and shortcomings in the system itself. It is also worth noting that we have already received the first results - N-Gage ranks fifth in the world in terms of the number of downloaded games, and we hope that it will soon enter the top three. And this is despite the fact that the service itself was launched only in October this year.

In 2009, we will begin to pay more attention to partnership deals with Russian service operators and application developers. I repeat, now we are working on debugging the service functioning system itself, so we still have a lot of work to do before localization.

E.M. Today, there are already established communities (in the field of blogging, sharing photos, etc.) around old projects, and it makes no sense for their users to switch to something new, but with the same functions. In a crisis, Internet companies become cheaper, especially in emerging markets, and they can be bought for reasonable money, thereby expanding their presence in the market. Are you considering such opportunities?

AB If we look at the cycle that ideas go through at Nokia, then I would say that out of 100 ideas, only two survive: first we collect information and concepts, some of them are already eliminated at this stage as the least feasible, then we evaluate the complexity of development and production and, finally, the ways of technology commercialization. As a result, there are no more than 2% of ideas that meet all our criteria, which is very, very small. If we talk about more global things, such as Morph, then they are based on very real technologies that can be implemented. Of course, I can't even give an approximate date for the release of such a device, or even the time when nanotechnology will provide us with the means to implement it. But I would say that if nothing happens to me, then by old age I will already have a phone like Morph.

E.M. At this stage of development of the telephone industry, are nanotechnologies already being used or are they planned to be used?

E.M. There is an opinion that in today's economic climate, Russian operators will be forced to enter the retail market. What do you think about this, and what are the possible ways for Nokia to cooperate with such associations, if this happens?

A.B. Without a doubt, financial constraints are taking their toll on retailers and distributors. However, the situation that you just described is not new for us – there are many examples of such acquisitions in the world, and this is a natural way out of the current difficulties. It is difficult to underestimate the role of retail players in our strategy - they are still in the focus of our attention, and if their network is owned by any operator, then we will certainly look for ways to cooperate to bring additional value to this retail network.

We already have established relationships with all the major Russian operators, and we cooperate with them on some projects, including loyalty programs and marketing. We are also trying to develop an optimal strategy for interacting with local retail, but this will take about 6-9 more months. However, I can say with confidence that we will take all the necessary steps so that no matter how the situation changes, our users have access to the best service.

E.M. What are Nokia's plans for the further development of touch technologies? Is there a chance that they will go beyond Series 60 in the near future, for example to Series 40? Will we see very cheap $200 touchscreen devices?

A.B. In terms of software platforms, Nokia focuses on three projects around which our service ecosystem is built - Series 60, Series 40 and Maemo. While we are going to introduce some services for the Series 40 as well, in terms of interface development these devices have always been more phones than mobile computers, and therefore we have serious doubts about the real usefulness of touch displays in phones built on Series 40. Ultimately, this technology is oriented more towards the use of various services, such as the N97 and its widgets. In our vision, Series 40 should have a fairly limited set of services, while Series 60 will be our main platform in this regard, however, as well as Maemo.

E.M. You mentioned that nanotechnology will affect battery performance. But when and how will they affect phone design? If not, what new solutions can we expect from Nokia in terms of design and materials?

A.B. When it comes to design, there are 3 key components: the design of the phone itself, materials and software, coupled with ease of use. These three elements must be in harmony in every serious product. The N97 is a great example - the opening mechanism that we have applied in it provides unparalleled strength and at the same time the convenience of the design. As for nanotechnologies, they will, in particular, make it possible to significantly lighten phones, as well as to create exceptionally strong and thin materials, naturally, they can find many applications in design. Finally, on the software side, we are working on a number of cross-platform features in this aspect, such as widgets on the N97.

E.M. What is your sales forecast for 2009?

A.B. Last week we had a Capital Markets Day in New York where we discussed various aspects of our financial situation and made some forecasts for the coming year. In general, we expect sales to fall by 5% compared to the current year, however, nothing more can be said, it is very difficult to make long-term forecasts now.

E.M. A few years ago, when Nokia first introduced the idea of ​​internet tablets, you had no competition, maybe Sony and Archos, but that's all. However, today the so-called netbooks, which are aimed at the same audience as your products, have become especially widespread. Are you afraid of competition from their side?

AB Firstly, I think that the very fact of the appearance of such devices indicates that we are moving in the right direction and that we have relied on precisely those devices that will form in the near future the whole market. But speaking specifically about these mini laptops… they really are bad laptops! They have very limited functionality, and they do not have the same service and contextual capabilities as our mobile solutions. Therefore, I am absolutely calm about the competition with these under-laptops. Moreover, we have been investing in the development of Maemo for quite a long time, a platform that will become the main platform for truly mobile devices with the richest service capabilities. Netbooks are convenient for the conditions in which we are now, but nothing more. This is just another fashion trend this year, and many people who bought such devices have already become deeply disappointed in them.

E.M. Today's Internet environment is largely built around search technology - is Nokia planning to introduce more sophisticated search algorithms and new features in this area?

AB There are many players in the market who started back in the early days of the Internet, such as Google and Yahoo, but I can't say that we are late to this market, we just started our development from another starting point. And speaking of search, modern search engines aren't all that complicated, it all comes down to just indexing anything and everything. We pay more attention to the social interactions of users, the relevance of data, their connection. Therefore, our real goal is to create a truly intelligent search algorithm that will take into account all these parameters, as well as your location, and produce results that are semantically meaningful for the person who uses it. Naturally, such technologies are only looming somewhere in the future, but we are investing heavily in this area, and our goal, as I mentioned earlier, is to coordinate and connect users, and this requires more than just web indexing -pages; in fact, we need to connect a person's life in the real world and his life on the Web.

E.M. There have recently been rumors that the total debts of Nokia's Russian distributors amount to about a billion dollars. How can you comment on this? In addition, how will the Dixis bankruptcy procedure affect Nokia's operations in Russia? Also last week, reports began to appear that Nokia had stopped deliveries of phones for one of the largest Russian retailers, is this true?

A.B. I could excuse myself with our standard response that we don't comment on rumours, but on the issue of debt, I would like to point out the following. Nokia is not a bank, we are a commercial organization and we are glad to see among our partners only those companies that care about their business and their debts. Besides, if someone owed us a billion, we would not be sitting in this restaurant! (laughs). In general, the financial side of our business is in good shape, although, of course, some things will change in 2009 due to the financial crisis.

Nokia is very well represented in Russia, and we would like to further increase our presence and weight in this market, so we will certainly continue to work with all the major players.

Round table with Anssi Vanjoki, Vice President of Nokia

In mid-December, Nokia Executive Vice President Anssi Vanjoki, who is also Head of Nokia Markets, arrived in Russia. The meeting was attended by a dozen journalists from different publications, so the questions are diverse, some are naive, some are ridiculous, for example, about a billion dollars in debt from Russian distributors. Nevertheless, the round table provides an opportunity to assess the direction in which the company will develop, to some extent shows the events from the inside, from Nokia's point of view. Let's start with Anssi's greetings:

If we look at the current world, we will see that it is not going through the best of times, and the financial crisis that began a few months ago has spread to almost all sectors of the economy, this is happening in the field of telecommunications, although I would rather said in the field of Internet technologies, which today is experiencing difficulties with further development.

Just a week ago, we launched another product on the market that brought even closer to the idea of ​​mobile convergence - Nokia N97; in essence, Yeshurab Kemis is a portable computer that has the power to change the consumer's perception of mobile devices in in general.

From Nokia's point of view, entering the Internet services market and moving it towards contextuality is a very interesting opportunity, and this segment is growing rapidly. In terms of geography, we have high hopes for Russia, even in today's economic climate, we will continue to expand our presence here and in every possible way contribute to the development of this market from mobile telephony to a much larger Internet services market.

Actually, that's all I wanted to say as an introduction to our discussion, and now the floor is up to you.

Eldar Murtazin: Sales of the 5800 in Russia are really amazing - the phone has already broken several records in this market. However, its popularity created the conditions for a massive leak of phones from the Russian market to other countries, where interest in the new product is also great. Is there any estimate of the number of devices taken from Russia?

E.M. How soon will Nokia be able to ramp up production of the 5800? As of today, you are facing a serious shortage of the device around the world, and it seems that it is not possible to cope with the situation yet.

AB We have a very large production capacity under the 5800, and we were aware at the very beginning of sales that this device would become very popular, but as you can see, the reality surpassed all our the wildest expectations, this is the main reason for the shortage. Also, don't forget that it usually takes 12 weeks from the moment a new device is launched to reach peak production volumes, in the case of the 5800, only four are in production, so we expect a significant increase in the number of phones produced already in the first quarter of 2009. As for Russia, the number of phones shipped will grow exponentially over the next few weeks.

E.M. Do you expect 5800 sales to remain at the same level in January as the Christmas shopping season ends?

A.B. We have already discussed this issue this morning, and, obviously, immediately after the New Year, we should expect a decrease in activity in the market. In our opinion, the market will continue to fall in the first quarter, and upon reaching the bottom, it will gradually start to become more active again. It's nice to know that Nokia is in a very good position in this regard - we already have the 5800, as well as a number of other interesting solutions that we hope to release next year.

E.M. Returning to the topic of the financial crisis, will the changed market conditions force you to reconsider your plans for the near future and market strategies, perhaps cancel some initiatives?

A.B. In fact, during the economic crisis, you can not slow down, on the contrary, you need to make every effort to release products and services on time. We at Nokia will try to do everything possible to prevent the disruption of the timing of the release of certain offers, not to mention their cancellation. During such periods, market leaders are formed, and we, in turn, would very much like to be among them.

AB I believe that we will continue with our previous policy, although we will have to slightly accelerate our development in the US - we have already invested a significant amount of funds in our own center in San Diego, which will develop solutions exclusively for the US market. Moreover, we are already working on separate devices for Verzion and AT&T.

E.M. Was Nokia's experience with AT&T successful (particularly with the 6555 phone)? You initially announced that this product was made specifically for the US market, but AT&T did not talk about significant sales, and subsequently the phone was released to the global market.

AB I think we're doing pretty well in the US market, and the fact that we've decided to make this phone available in the rest of the markets just shows that we've seen additional opportunities in similar behavior, that's all.

E.M. A huge number of counterfeit phones like Nokla first come to the east of Russia, then move to the west and eventually end up in Europe. Is Nokia trying to fight information against such products?

A.B. The surest way to counter fakes is to expand your presence in the regions where such devices are produced, as well as to close such manufacturers in court. In general, we do not believe that campaigns can have a comparable effect.

E.M. So far, all the questions have been about phones, but at the same time, Nokia has recently positioned itself as an Internet company. I would like to hear how you assess the success of these initiatives, in particular, the OVI service?

A.B. To begin with, it's worth noting that Nokia's service strategy is not new at all - we've been moving towards it for many years, and all this work materialized in the form of an announcement that we made almost a year ago. Since then, we have been doing our best to implement all the services we envisioned and make them easy to use. And I would like to note that today we are ahead of our schedule, which was laid down a year ago. The most popular service at the moment is Navigation, we have implemented it on a number of devices that cover a large number of local markets. In addition, we have invested heavily in NavTeq, the world's leading electronic charter, and for us, NavTeq is not just an opportunity to expand the navigation component of our devices, but also a whole platform with which we can literally coordinate the whole world.

E.M. It's no secret that OVI is focused on the Western market, because often its services do not have localization or, let's say, some of them only support already established networks (flickr, etc.), hence the serious problem of the language barrier arises. Are there any joint steps planned with Russian providers and service providers in this direction? Are there already any ready-made solutions for local markets?

A.B. The thing that sets Nokia apart from all other Internet service players is our ubiquitous physical presence. Other companies also distribute their services around the world, but virtually. Therefore, one of the key components of our strategy is the localization of services and solutions. We have serious intentions related to bringing our services to local markets, but we must do it gradually - in 2009 you can already see some progress in this direction (for example, Nokia Music Store will be available in Russia in the first half of 2009 ), and, of course, we plan to launch a localized version of OVI on the Russian service market.

However, today the key task is to debug international versions of services and fix errors and shortcomings in the system itself. It is also worth noting that we have already received the first results - N-Gage ranks fifth in the world in terms of the number of downloaded games, and we hope that it will soon enter the top three. And this is despite the fact that the service itself was launched only in October this year.

In 2009, we will begin to pay more attention to partnership deals with Russian service operators and application developers. I repeat, now we are working on debugging the service functioning system itself, so we still have a lot of work to do before localization.

E.M. Today, there are already established communities (in the field of blogging, sharing photos, etc.) around old projects, and it makes no sense for their users to switch to something new, but with the same functions. In a crisis, Internet companies become cheaper, especially in emerging markets, and they can be bought for reasonable money, thereby expanding their presence in the market. Are you considering such opportunities?

A.B. In our development strategy for OVI, we see it as a complete platform for mobile access to all the services that the user needs. I tend to call it "all in one" - on the one hand, we have our own Nokia services, but we also work with companies like YouTube, flickr, etc. Moreover, all these services can be safely used with our devices. And in this regard, we do not exclude the possibility of cooperation with local service providers in order to further enrich the platform. Ultimately, our goal is to provide users with access to all the services and capabilities they need, and in this sense, OVI is exactly a platform open to new opportunities.

E.M. Nokia differs from other manufacturers in a large number of concept models, is it possible to somehow calculate the percentage of those solutions that are actually implemented in practice? Recently, Nokia introduced the concept of a nanotube phone (Nokia Morph), is this concept planned to be implemented and if so, when?

AB If we look at the cycle that ideas go through at Nokia, then I would say that out of 100 ideas, only two survive: first we collect information and concepts, some of them are already eliminated at this stage as the least feasible, then we evaluate the complexity of development and production and, finally, the ways of technology commercialization. As a result, there are no more than 2% of ideas that meet all our criteria, which is very, very small. If we talk about more global things, such as Morph, then they are based on very real technologies that can be implemented. Of course, I can't even give an approximate date for the release of such a device, or even the time when nanotechnology will provide us with the means to implement it. But I would say that if nothing happens to me, then by old age I will already have a phone like Morph.

E.M. At this stage of development of the telephone industry, are nanotechnologies already being used or are they planned to be used?

A.B. The first area likely to be touched by nanotechnology will be power supplies and conductors - now we need to provide longer battery life, make phones lighter, more energy efficient. In general, there are many reasons and applications for nanotechnology in the construction of phones, but batteries will most likely be our first step in this direction.

E.M. Does the launch of touch screen devices mean the end of Nokia's internet tablet line?

A.B. Definitely not. We've been familiar with touchscreen technology for a long time because we were actually the first company to introduce such a device (7710). And in fact, Internet tablets are by no means a dying type of device; on the contrary, they are our future. When I announced these devices, I mentioned that it would take at least five generations of devices before they become truly mainstream. At the moment, there are already three generations on the market, the fourth is under development and is based on the Maemo platform, written specifically for touch devices, which is a very important advantage.

E.M. There is an opinion that in today's economic climate, Russian operators will be forced to enter the retail market. What do you think about this, and what are the possible ways for Nokia to cooperate with such associations, if this happens?

A.B. Without a doubt, financial constraints are taking their toll on retailers and distributors. However, the situation that you just described is not new for us – there are many examples of such acquisitions in the world, and this is a natural way out of the current difficulties. It is difficult to underestimate the role of retail players in our strategy - they are still in the focus of our attention, and if their network is owned by any operator, then we will certainly look for ways to cooperate to bring additional value to this retail network.

We already have established relationships with all the major Russian operators, and we cooperate with them on some projects, including loyalty programs and marketing. We are also trying to develop an optimal strategy for interacting with local retail, but this will take about 6-9 more months. However, I can say with confidence that we will take all the necessary steps so that no matter how the situation changes, our users have access to the best service.

E.M. What are Nokia's plans for the further development of touch technologies? Is there a chance that they will go beyond Series 60 in the near future, for example to Series 40? Will we see very cheap $200 touchscreen devices?

A.B. In terms of software platforms, Nokia focuses on three projects around which our service ecosystem is built - Series 60, Series 40 and Maemo. While we are going to introduce some services for the Series 40 as well, in terms of interface development these devices have always been more phones than mobile computers, and therefore we have serious doubts about the real usefulness of touch displays in phones built on Series 40. Ultimately, this technology is oriented more towards the use of various services, such as the N97 and its widgets. In our vision, Series 40 should have a fairly limited set of services, while Series 60 will be our main platform in this regard, however, as well as Maemo.

E.M. You mentioned that nanotechnology will affect battery performance. But when and how will they affect phone design? If not, what new solutions can we expect from Nokia in terms of design and materials?

A.B. When it comes to design, there are 3 key components: the design of the phone itself, materials and software, coupled with ease of use. These three elements must be in harmony in every serious product. The N97 is a great example - the opening mechanism that we have applied in it provides unparalleled strength and at the same time the convenience of the design. As for nanotechnologies, they will, in particular, make it possible to significantly lighten phones, as well as to create exceptionally strong and thin materials, naturally, they can find many applications in design. Finally, on the software side, we are working on a number of cross-platform features in this aspect, such as widgets on the N97.

E.M. What is your sales forecast for 2009?

A.B. Last week we had a Capital Markets Day in New York where we discussed various aspects of our financial situation and made some forecasts for the coming year. In general, we expect sales to fall by 5% compared to the current year, however, nothing more can be said, it is very difficult to make long-term forecasts now.

E.M. A few years ago, when Nokia first introduced the idea of ​​internet tablets, you had no competition, maybe Sony and Archos, but that's about it. However, today the so-called netbooks, which are aimed at the same audience as your products, have become especially widespread. Are you afraid of competition from their side?

AB Firstly, I think that the very fact of the appearance of such devices indicates that we are moving in the right direction and that we have relied on precisely those devices that will form in the near future the whole market. But speaking specifically about these mini laptops… they really are bad laptops! They have very limited functionality, and they do not have the same service and contextual capabilities as our mobile solutions. Therefore, I am absolutely calm about the competition with these under-laptops. Moreover, we have been investing in the development of Maemo for quite a long time, a platform that will become the main platform for truly mobile devices with the richest service capabilities. Netbooks are convenient for the conditions in which we are now, but nothing more. This is just another fashion trend this year, and many people who bought such devices have already become deeply disappointed in them.

E.M. Today's Internet environment is largely built around search technology - is Nokia planning to introduce more sophisticated search algorithms and new features in this area?

AB There are many players in the market who started back in the early days of the Internet, such as Google and Yahoo, but I can't say that we are late to this market, we just started our development from another starting point. And speaking of search, modern search engines aren't all that complicated, it all comes down to just indexing anything and everything. We pay more attention to the social interactions of users, the relevance of data, their connection. Therefore, our real goal is to create a truly intelligent search algorithm that will take into account all these parameters, as well as your location, and produce results that are semantically meaningful for the person who uses it. Naturally, such technologies are only looming somewhere in the future, but we are investing heavily in this area, and our goal, as I mentioned earlier, is to coordinate and connect users, and this requires more than just web indexing -pages; in fact, we need to connect a person's life in the real world and his life on the Web.

E.M. There have recently been rumors that the total debts of Nokia's Russian distributors amount to about a billion dollars. How can you comment on this? In addition, how will the Dixis bankruptcy procedure affect Nokia's operations in Russia? Also last week, reports began to appear that Nokia had stopped deliveries of phones for one of the largest Russian retailers, is this true?

A.B. I could excuse myself with our standard response that we don't comment on rumours, but on the issue of debt, I would like to point out the following. Nokia is not a bank, we are a commercial organization and we are glad to see among our partners only those companies that care about their business and their debts. Besides, if someone owed us a billion, we would not be sitting in this restaurant! (laughs). In general, the financial side of our business is in good shape, although, of course, some things will change in 2009 due to the financial crisis.

Nokia is very well represented in Russia, and we would like to further increase our presence and weight in this market, so we will certainly continue to work with all the major players.

Round table with Anssi Vanjoki, Vice President of Nokia

In mid-December, Nokia Executive Vice President Anssi Vanjoki, who is also Head of Nokia Markets, arrived in Russia. The meeting was attended by a dozen journalists from different publications, so the questions are diverse, some are naive, some are ridiculous, for example, about a billion dollars in debt from Russian distributors. Nevertheless, the round table provides an opportunity to assess the direction in which the company will develop, to some extent shows the events from the inside, from Nokia's point of view. Let's start with Anssi's welcome words:

If we look at the current world, we will see that it is not going through the best of times, and the financial crisis that began a few months ago has spread to almost all sectors of the economy, this is happening in the field of telecommunications, although I would rather said in the field of Internet technologies, which today is experiencing difficulties with further development.

But if we look at the trend that is now gaining momentum around the world, this is the widespread penetration of the Internet into the daily life of every person, and the next stage of development that we have already entered involves the development of the Internet towards mobile technologies and contextual services , and we hope that Nokia will become one of the leading players in determining what this industry will look like in the future.

That's why we're launching a range of new products that are more computers than mobile phones, but we're not going to abandon the mobile market either. In a country like Russia, in our opinion, the full potential for the penetration of mobile phones has not yet been exhausted. We are also optimistic about the rapid development of 3G networks in this region and hope that they will soon appear in Moscow.

And if we look at the most discussed topics today, it is undoubtedly the launch of the Nokia 5800 XpressMusic in Russia, which was the first market where we started selling this phone, and at the moment everything indicates an unprecedented demand from buyers for this model .

E.M. Do you expect 5800 sales to remain at the same level in January when the Christmas shopping season ends?

A.B. We have already discussed this issue this morning, and, obviously, immediately after the New Year we should expect a decrease in activity in the market. In our opinion, the market will continue to fall in the first quarter, and upon reaching the bottom, it will gradually start to become more active again. It's nice to know that Nokia is in a very good position in this regard - we already have the 5800, as well as a number of other interesting solutions that we hope to release next year.

E.M. Returning to the theme of the financial crisis - will the changed market conditions force you to reconsider your plans for the near future and market strategies, perhaps cancel some initiatives?

A.B. In fact, during the economic crisis, one should not slow down, on the contrary, it is necessary to make every effort to release products and services in a timely manner. We at Nokia will try to do everything possible to prevent the disruption of the timing of the release of certain offers, not to mention their cancellation. During such periods, market leaders are formed, and we, in turn, would very much like to be among them.

E.M. Do you know which market the N97 will hit first?

A.B. Yes, I know this, but I would not like to expand on this topic yet. At the same time, I believe that we still need to fully explore and weigh the full potential of the N97, ultimately, this is not just another new phone, but a completely new concept that carries a whole range of services created by both Nokia and third-party developers. As you can see now, there is still a lot of empty space on the N97's home screen for future widgets and applications, I assure you, by launch they will all be occupied by both services and built-in functions. Therefore, we will need to evaluate the readiness of related services in various markets, and only then can we finally decide on the market in which the initial launch of the N97 will take place.

E.M. Over the past few years, Nokia has made great efforts to market some of its products in the US market. Will your strategy change in any way, taking into account the adjustments made by the financial crisis?

A.B. I believe that we will stick to our previous policy, although we will have to slightly accelerate our development in the US - we have already invested a significant amount of funds in our own center in San Diego, which will develop solutions exclusively for the US market. Moreover, we are already working on separate devices for Verzion and AT&T.

E.M. Was Nokia's experience with AT&T successful (particularly with the 6555 phone)? You initially announced that this product was made specifically for the US market, however, AT&T did not talk about significant sales, and subsequently the phone was released to the global market.

A.B. In my opinion, we are doing quite well in the US market, and the fact that we decided to make this phone available in other markets only shows that we saw additional opportunities in this behavior, that's all.

E.M. A huge number of counterfeit phones like Nokla first come to the east of Russia, then move to the west and eventually end up in Europe. Is Nokia trying to wage an information war against such products?

A.B. The surest way to counter fakes is to expand your presence in the regions where such devices are produced, as well as to close such manufacturers in court. In general, we do not believe that campaigns can have a comparable effect.

E.M. So far, all the questions have been about phones, but at the same time, Nokia has recently positioned itself as an Internet company. I would like to hear how you assess the success of these initiatives, in particular, the OVI service?

A.B. To begin with, it's worth noting that Nokia's service strategy is not new at all - we've been moving towards it for many years, and all this work materialized in the form of an announcement that we made almost a year ago. Since then, we have been doing our best to implement all the services we envisioned and make them easy to use. And I would like to note that today we are ahead of our schedule, which was laid down a year ago. The most popular service at the moment is Navigation, we have implemented it on a number of devices that cover a large number of local markets. In addition, we have invested heavily in NavTeq, the world's leading electronic charter, and for us, NavTeq is not just an opportunity to expand the navigation component of our devices, but also a whole platform with which we can literally coordinate the whole world.

E.M. It's no secret that OVI is focused on the Western market, because often its services do not have localization or, let's say, some of them only support already established networks (flickr, etc.), hence the serious problem of the language barrier arises. Are there any joint steps planned with Russian providers and service providers in this direction? Are there already any ready-made solutions for local markets?

A.B. The thing that sets Nokia apart from all other players in the internet services market is our ubiquitous physical presence. Other companies also distribute their services around the world, but virtually. Therefore, one of the key components of our strategy is the localization of services and solutions. We have serious intentions related to bringing our services to local markets, but we must do it gradually - in 2009 you can already see some progress in this direction (for example, Nokia Music Store will be available in Russia in the first half of 2009 ), and, of course, we plan to launch a localized version of OVI on the Russian service market.

However, today the key task is to debug international versions of services and fix errors and shortcomings in the system itself. It is also worth noting that we have already received the first results - N-Gage ranks fifth in the world in terms of the number of downloaded games, and we hope that it will soon enter the top three. And this is despite the fact that the service itself was launched only in October this year.

In 2009, we will begin to pay more attention to partnership deals with Russian service operators and application developers. Again, we are currently working on debugging the service functioning system itself, so we still have a lot of work to do before localization.

E.M. Today, there are already established communities (in the field of blogging, sharing photos, etc.) around old projects, and it makes no sense for their users to switch to something new, but with the same functions. In a crisis, Internet companies become cheaper, especially in emerging markets, and they can be bought for reasonable money, thereby expanding their presence in the market. Are you considering such opportunities?

A.B. If we look at the cycle that ideas go through at Nokia, then I would say that out of 100 ideas, only two survive: first we collect information and concepts, some of them are eliminated already at this stage as the least feasible, then we evaluate the complexity development and production and, finally, ways to commercialize the technology. As a result, there are no more than 2% of ideas that meet all our criteria, which is very, very small. If we talk about more global things, such as Morph, then they are based on very real technologies that can be implemented. Of course, I can't even give an approximate date for the release of such a device, or even the time when nanotechnology will provide us with the means to implement it. But I would say that if nothing happens to me, then by old age I will already have a phone like Morph.

E.M. At this stage of development of the telephone industry, are nanotechnologies already being used or are they planned to be used?

A.B. Most likely, the first area to be touched by nanotechnology will be power supplies and conductors - now we need to provide longer battery life, make phones lighter, more economical in terms of energy. In general, there are many reasons and applications for nanotechnology in the construction of phones, but batteries will most likely be our first step in this direction.

E.M. Does the launch of touchscreen devices mean the end of Nokia's internet tablet series?

A.B. Definitely not. We've been familiar with touchscreen technology for a long time because we were actually the first company to introduce such a device (7710). And in fact, Internet tablets are by no means a dying type of device; on the contrary, they are our future. When I announced these devices, I mentioned that it would take at least five generations of devices before they become truly mainstream. At the moment, there are already three generations on the market, the fourth is under development and is based on the Maemo platform, written specifically for touch devices, which is a very important advantage.

E.M. There is an opinion that in today's economic climate, Russian operators will be forced to enter the retail market. What do you think about this, and what are the possible ways for Nokia to cooperate with such associations, if this happens?

A.B. Without a doubt, financial constraints are taking their toll on retailers and distributors. However, the situation that you just described is not new for us – there are many examples of such acquisitions in the world, and this is a natural way out of the current difficulties. It is difficult to underestimate the role of retail players in our strategy - they are still in the focus of our attention, and if their network is owned by any operator, then we will certainly look for ways to cooperate to bring additional value to this retail network.

We already have established relationships with all the major Russian operators, and we cooperate with them on some projects, including loyalty programs and marketing. We are also trying to develop an optimal strategy for interacting with local retail, but this will take about 6-9 more months. However, I can say with confidence that we will take all the necessary steps so that no matter how the situation changes, our users have access to the best service.

E.M. What are Nokia's plans for the further development of touch technologies? Is there a chance that they will go beyond Series 60 in the near future, for example to Series 40? Will we see very cheap $200 touchscreen devices?

A.B. In terms of software platforms, Nokia focuses on three projects around which our service ecosystem is built - Series 60, Series 40 and Maemo. While we are going to introduce some services for the Series 40 as well, in terms of interface development these devices have always been more phones than mobile computers, and therefore we have serious doubts about the real usefulness of touch displays in phones built on Series 40. Ultimately, this technology is oriented more towards the use of various services, such as the N97 and its widgets. In our vision, Series 40 should have a fairly limited set of services, while Series 60 will be our main platform in this regard, however, as well as Maemo.

E.M. You mentioned that nanotechnology will affect battery performance. But when and how will they affect phone design? If not, what new solutions can we expect from Nokia in terms of design and materials?

A.B. Speaking about design, it is necessary to highlight 3 key components: the actual design of the phone, materials and software, coupled with ease of use. These three elements must be in harmony in every serious product. The N97 is a great example - the opening mechanism that we have applied in it provides unparalleled strength and at the same time the convenience of the design. As for nanotechnologies, they will, in particular, make it possible to significantly lighten phones, as well as to create exceptionally strong and thin materials, naturally, they can find many applications in design. Finally, on the software side, we are working on a number of cross-platform features in this aspect, such as widgets on the N97.

E.M. What is your sales forecast for 2009?

E.M. Today's Internet environment is largely built around search technology - is Nokia planning to introduce more sophisticated search algorithms and new features in this area?

A.B. There are many players in the market that started back in the early days of the Internet, such as Google and Yahoo, but I can't say that we are late to this market, we just started our development from a different starting point. And speaking of search, modern search engines aren't all that complicated, it all comes down to just indexing anything and everything. We pay more attention to the social interactions of users, the relevance of data, their connection. Therefore, our real goal is to create a truly intelligent search algorithm that will take into account all these parameters, as well as your location, and produce results that are semantically meaningful for the person who uses it. Naturally, such technologies are only looming somewhere in the future, but we are investing heavily in this area, and our goal, as I mentioned earlier, is to coordinate and connect users, and this requires more than just web indexing -pages; in fact, we need to connect a person's life in the real world and his life on the Web.

E.M. There have recently been rumors that the total debts of Nokia's Russian distributors amount to about a billion dollars. How can you comment on this? In addition, how will the Dixis bankruptcy procedure affect Nokia's operations in Russia? Also last week, reports began to appear that Nokia had stopped deliveries of phones for one of the largest Russian retailers, is this true?

A.B. I could excuse myself with our standard response that we don't comment on rumours, but on the question of debt, I would like to point out the following. Nokia is not a bank, we are a commercial organization and we are glad to see among our partners only those companies that care about their business and their debts. Besides, if someone owed us a billion, we would not be sitting in this restaurant! (laughs). In general, the financial side of our business is in good shape, although, of course, some things will change in 2009 due to the financial crisis.

Nokia is very well represented in Russia, and we would like to further increase our presence and weight in this market, so we will certainly continue to work with all the major players.