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Nokia planning to supply phones for DoCoMo network

Nokia Oyj, the world's biggest mobile-phone maker, will supply handsets for NTT DoCoMo Inc's latest service in Japan, the Nihon Keizai newspaper said. The move could allow Nokia to expand its tiny share of the country's US$73 billion annual market for mobile phones and services.

Nokia handsets will be offered on Tokyo-based DoCoMo's FOMA service, the newspaper said. FOMA features easier access to e-mails, music and video through its so-called third generation network. DoCoMo spokeswoman Mariko Hanaoka did not confirm the report, saying nothing had been decided. Shinko Osada, a spokeswoman for Nokia in Tokyo, declined to comment. Nokia is based in Espoo, Finland.

DoCoMo, the world's second-largest mobile-phone operator, buys its FOMA handsets from Japanese makers such as NEC Corp and Matsushita Electric Industrial Co, with most priced at a premium to older service models. Sourcing from Nokia, which will offer handsets for similar so-called third-generation services around the world, may allow DoCoMo to reduce its purchasing costs and offer a lower-priced handset range.

"DoCoMo's biggest aim is to lower the procurement price," said Shinji Moriyuki, a senior analyst at Daiwa Institute of Research Ltd, who has a "outperform" rating on DoCoMo shares.

"DoCoMo will eventually have more users for FOMA than for its older networks, so lower-priced handsets will definitely be needed."

Nokia and closest rival Motorola Inc control a combined 48 percent of global mobile-phone sales, yet have almost no presence in Japan, largely because the country has employed its own wireless standards in the past. Introduction of so-called third-generation wideband code-division multiple access technology globally means the two can more easily offer handsets compatible with DoCoMo's network.

Nokia already sells handsets that can be used on Vodafone Group Plc's third-generation network in Japan.
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