14 DAY TRIAL // Nokia might have a hard time getting rid of current Lumia inventory as the world prepares for the landing of Windows Phone 8, reports suggest.
The main issue that Nokia reportedly faces is the fact that existing devices won’t taste an upgrade to Windows Phone 8, which would significantly affect their performance on the market.
Apparently, the company might be forced to write down hundreds of thousands of Lumia devices before the arrival of Windows Phone 8, at least this is what RDC Capital Analyst Mike Sue suggests.
The Finnish mobile phone maker has already reduced the amount of orders it placed with ODM Compal Communications, which greatly influenced the company’s revenues for last month.
A recent article on DigiTimes reports that Compat registered a drop in revenue of 39.5 percent sequentially in June.
The ODM is expected to continue to be impacted by the move in the coming months, though things might change to better as soon as Nokia kicks off manufacturing of Windows Phone 8 devices.
Nokia already cut the price tags for its Lumia devices in various markets around the world, which helped it boost sales a bit.
However, with the near availability of Windows Phone 8 and the announcement regarding the lack of an upgrade path for current devices, sales are expected to drop in the coming months.
Of course, Nokia will provide its users with upgrades to the Windows Phone 7.8 platform release, but that will provide them only with a few of the features included in the upcoming major release.
What current Lumia users won’t benefit from include better hardware inside their devices, such as HD screens and microSD memory card slots, which will be available on new Windows Phone 8 handsets.
In the end, Nokia might have to sell its current device inventory at incredible low prices, or even destroy them. Either way, the company’s shares are expected to plummet when the news strikes.