Sanyo Electric has reached agreement with Nokia to set up a 50-50 joint venture in the US as early as next autumn to produce CDMA2000 3G cell phones. In Japan, KDDI Corp's 'au' cell phone service is based on the CDMA2000 standard, but DoCoMo's 'FOMA' and Vodafone KK's 3G services use the W-CDMA standard.
Sanyo, currently undergoing a business rehabilitation program, will independently continue operations for 3G handsets for the W-CDMA standard, thereby concentrating its resources on the W-CDMA handsets to better manage its tight financial situation.
Sanyo's sales of cellular phones is suffering from low profitability. But interestingly M:Metrics recently released a report showing that 50% of Sanyo SCP-8200 owners (and 48% of RAZR owners) used mobile applications or downloaded mobile content in November 2005 in the US - "out-consuming subscribers of all other devices".
The portion of owners of these devices that are used to access mobile applications or downloaded mobile content is more than double that of the market overall.
Nokia will be capitalising on this success of Sanyo in the US, which is perhaps one of the few bargaining chips Sanyo has at the moment. It is thought that the deal could also help Nokia in its efforts to gain some traction in the Japanese market.
Sanyo is the world's largest maker of rechargeable batteries and supplies lithium-ion batteries to Nokia and other major mobile phone makers. Batteries is one of Sanyo's most profitable businesses and "one of its few pockets of strength left," according to Reuters.
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