It isn't surprising that Jorma Ollila, Chairman and CEO of Nokia, should choose to visit India again. This, after all, is one of the two most happening telecommunication markets in the world, and one that cannot seem to have enough Nokia handsets (handsets accounted for around 80 per cent of the company's revenues of Euro 25 billion in 2003; networks, rather the equipment sold to telcos, accounted for the rest). With India's telcos enhancing networks or putting down new ones, Nokia is hoping to make a dent in a market in which it has traditionally played second fiddle to its Scandinavian rival Ericsson, something that was evident from the fact that Ollila met with almost all telcos of note during his visit. The former banker was unsurprisingly thrilled at the way the Indian market has changed since his last visit in 2000 (when this magazine met with him; see "We Will Continue On The Road We've Created", BT, April 7, 2000). He spoke to R. Sukumar on India, the future of networks, and Nokia. Excerpts from an exclusive interview.

To kick things off, what change do you see in the Indian market between 2000 and 2004?

First off, you see the buoyancy of the economy. From the point of view of the telecom market, we have seen a take off of mobile communications. I think the regulatory bodies have done an excellent job. In terms of regulation, India is really on the right track now. Clearly, there are some areas that are being worked on but the way mobile communication has been deregulated has really fuelled competition. And competition is what benefits the end-user. The telecom market is in an accelerated phase in terms of growth. And the last 15 months have been exceptional. India is now the fastest growing market. It's very very rewarding to come back and see what we've achieved both on the network and the handset side.

More than 70 per cent of your sales comes from handsets...

Last year it was 80 per cent, and 20 per cent came from infrastructure...

... and that's the more profitable business, in terms of operating margins...

...or has been in the past few years, but I think the infrastructure business, apart from the last couple of years of slow growth and restructuring has historically been solidly profitable and we expect it to be so in the future.

How do you see Nokia? Is it a consumer products company? A lifestyle company? A fashion company? Or a technology company?

All of the above. We are a technology company providing products and solutions in the area of mobile communications that gives people unique experiences. That happens through the lifestyle, through the design, through the consumer experience-elements that we have imbedded in the products. It would be wrong to say, for instance, that we are a consumer electronics company because that doesn't tell the story.

In the last few years there have been significant developments in the wireless business in two or three areas. One is 'enterprise mobility', where you have a partnership going with IBM. Then, there are the multimedia and gaming initiatives. Tell us about your plans in these areas.

We will continue to grow in both networks and mobile handsets, but we see two important growth segments that will make us a different company with a broader, higher value-added mix of products. These are consumer multimedia and enterprise solutions.

Businessmen are heavy users of mobile phones, yet businesses are yet to make mobility part of their information solutions. I do not think the operators or the IT industry, or us in the telecom industry have addressed that issue. There really isn't a corporate solution for handsets. We are setting up a new unit that will look at how we combine the IT industry know-how with what we are doing in order to bring mobility to be part of the it solution for companies.

This business revolves around partnerships. One such is the one we have with IBM on the new Communicator that is coming out by the end of the year. IBM is working on corporate applications for that Communicator. This isn't about next quarter. It will take two years before we get the first solutions out. Obviously easy-to-use e-mail is central to the corporate solution, and we have that in mind.

"We will see the commercial launch of 3G in most markets later this year"

Imaging, media, and games are areas that are important on the consumer side. On the games side, we have already started the N-gage programme. We will have several new devices to cover different segments, entry level and advanced. We will be a games publisher and we will use games from other publishers. This is also a lifestyle issue. Mobile games, the interactive games where you use mobile networks, will be an important additional element to the gaming industry.

There is growing talk of alternatives to 3G networks. Intel is speaking of something called Wi-Max that can be used by cellular networks on their existing infrastructure to provide high-speed data connectivity.

I think the future scenario is clearly one where the wide area network coverage will be provided by cellular 3G. In the hot spots, you have other types of solutions like Wi Fi, which is a good complementary solution, and there will be devices that can work both on cellular and Wi Fi as our Communicator that is going to come out by the end of the year does. I do not see the same kind of coverage being provided in other ways. We will see the commercial launch of 3G in most markets later this year. (The Intel thing) is in a very initial phase, so we don't have any information.

What about competition from Microsoft's Smartphone operating system?

Symbian (the operating system Nokia uses) is the only robust platform available today but we understand that there will be alternatives.

Ericsson recently signed a large deal in India for network management. Would Nokia be open to such deals?

We recently decided to look at managed services the same way some of our major competitors have done. We have 15 customers in different parts of the world with whom we have signed such contracts

Imaging and multimedia have been key to the growth of Nokia over the past few years. What will drive growth in the future?

It will continue to be imaging and multimedia. (Then, there's) access to e-mail and other enterprise solutions and video streaming.

There are going to be upwards of 20 million phones sold in India this year. Do you think it makes sense for a company like Nokia to look at manufacturing locally?

Now, the volumes are very significant. We are looking at the situation to ensure that we are both cost-effective and logistically efficient. We have three plants in Asia that have served us well and we have no capacity problems. But with the market developing rapidly, we have to keep a close eye on it. At the moment, though there's nothing further to report.

Last one. You recently attended the GSM conference at Cannes. What's your take on this entire GSM versus CDMA thing. Which is the technology of the future?

If you look at last year's final quarter, and look at new additions to the network, GSM had 80 per cent and CDMA the balance. That's the situation globally. But that's not really the point. The technology is not the solution for what the consumer wants. It's just an enabler. Any of the acronyms we have talked about here, none of them is important to the end-user. He wants ease of use. I do not think the access technology will dominate the discussion going forward. It does less so, already.