Europe : Reuters : Nokia said on Tuesday that mobile telecoms operators had started to increase investments in high-speed networks after the summer holidays, but it was also pushing cheaper and slower alternatives. "There's clearly change in the air. We've seen acceleration of third generation networks after the summer holidays," Jukka Bergqvist, Nokia's executive vice president for its Networks business, told Reuters in an interview on the sidelines of the annual Nokia Mobile Internet Conference.

Nokia has said that by late September it had shipped 27,000 radio base stations for WCDMA mobile networks used in Japan and Europe, and which enable video conferencing on cell phones. It claims to have over 30 percent of the emerging market.

Investors are looking for signs that the 30 billion euros a year mobile telecoms networks industry is stabilising after having shrunk 40 percent in the last two years as cash-starved telecoms carriers cut spending following over-investments in the late 1990s. Bergqvist emphasised mobile operators did not yet appear to be raising their overall investments and were probably spending more on high-speed networks but finding savings elsewhere. "They are still cautious," he said.

Nokia's rivals like U.S.-based Motorola said earlier this month that operators might be turning more positive now that most have trimmed their debts and are improving cash flow.

Operators in emerging markets like India, Russia and China face very different challenges, as they are still rolling out old-fashioned mobile voice networks for a population unable to afford the average 30 euros a month on mobile phone bills.

To that end, Nokia has started selling the first versions of much cheaper mobile networks.

"The operators and us should be able to achieve good levels of profitability even when mobile subscribers spend less than 10 euros a month, perhaps even five," Bergqvist said.

Cheaper networks, which will result in further price cuts, will help mobile operators overtake fixed line telecoms carriers as the premier providers of voice calls, Nokia estimates.

Half of all voice call minutes could be carried out on a mobile network by the end of 2007, up from 20 percent now. "Eventually, all voice traffic will go mobile," Bergqvist said.

Nokia Networks, which generates some 20 percent of the company's total sales, will also have several new products soon on sale, such as a "walkie-talkie" service it announced in February that would allow users to push a single button to talk instantly to a select group of friends or colleagues without dialing any numbers.

It also said it had signed 10 customers for a new product which makes it easy for operators to deliver Internet services to subscribers. The product should also make it easier for consumers to use new services, such as picture messaging, removing the need to adjust settings in the mobile phone.

"It hides the complexity from the operator and the consumer," Bergqvist said.

Copyright 2003, Reuters News Service