2002 to see handset recovery, says Nokia

Nokia has forecast worldwide sales of mobile phones will recover in 2002. However, a squeeze on hardware margins and the modest nature of the gains meant shares in the Finnish company fell six per cent yesterday.

Nokia told analysts in New York that the entire industry will see 10 to 15 per cent growth next year. This year, the market has not expanded, according to industry estimates.

The company is pinning more hope than ever on software licensing and services from its Club Nokia portal business, and says its networking division will outstrip many rivals' with a 15 per cent surge in sales.

However, profits away from hardware are an untested area for the giant, and one in which it will inevitably come up against Microsoft. Also, CEO Jorma Ollila said any general rebound will only begin towards the end of next year and Europe won't be strong at least until then, according to a report in The Wall Street Journal.