Nokia 2003 Annual Report Download - page 27

developing innovative products and services. In the near term, we intend to focus on
imaging and games, where we have already introduced a number of products. Our strategy
to drive consumer multimedia will also involve leverage of our strong position in the
consumer voice market.
• Bring extended mobility to enterprise: We intend to capture profitable segments of the
corporate market by offering products and services that will benefit companies and
individual business people alike, including a diverse handset range as well as security and
mobile connectivity solutions specifically tailored for enterprise needs. As we do this, we
intend to capitalize on companies’ needs for mobility and seamless mobile connectivity in
their operations, and also expect to collaborate with leading technology and systems
integration partners.
We believe that our three main strategies will position our business favorably as different digital
technologies and industries converge. We also aim to drive open standards, specifications and
interoperability, for the purpose of ensuring the introduction of new, interoperable mobile services
worldwide. In this context, we intend to continue our pursuit of new business areas in the world
of mobility, while continuing to build on our leadership in mobile voice. This in turn means that
we must cultivate a strong local presence in all growing markets and pursue collaboration and
investment opportunities in order to obtain complementary technologies and a strong market
position.
Core Business Strengths
There are several core business strengths that we believe differentiate Nokia from our peers and
enable us to maintain a leadership position in our industry:
• Brand as an asset: According to a variety of consumer surveys, the Nokia brand is
associated with well-designed, high-quality and technologically advanced products and
customer services that are also user-friendly. Our leading brand, together with our
400 million strong customer base, lead to greater market access, and enable us to attract
and retain the best suppliers and employees. In 2003, we invested EUR 1 414 million in
advertising and promotion, representing approximately 5% of net sales, and we intend to
sustain and enhance the Nokia brand through active advertising, sponsorship and other
marketing activities in all of our principal markets.
• Strong product offering: Our strong product offering goes beyond voice-centric mobile
phones to include entirely new functional categories of mobile devices, such as enhanced
communicators, entertainment and gaming devices and media and imaging phones.
• Advanced technology: Nokia is a frontrunner in developing leading technologies with
approximately 39% of our workforce employed in the area of research and development
and 12.8% of net sales (EUR 3 760 million) invested in research and development in 2003.
Excluding personnel-related restructuring costs as well as impairments and write-offs of
capitalized R&D expenses in Nokia Networks, R&D expenses would have represented 11.2%
of net sales in 2003. For more information, see ‘‘Item 5.C Research and Development, Patents
and Licenses.’’ Almost 80% of our research and development investments are directed
towards software, primarily for use in our products and solutions. Our research and
development achievements are reflected in the strength of our registered and filed patent
portfolio.
• Excellence in execution: We have demonstrated our experience, efficiency and skill in
execution, and in managing our demand-supply chain to deliver new ideas and
technologies in product form at the right time, and in sufficient volumes.
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