Nokia ( NOK) got caught napping.

Like a sporting goods store peddling hockey sticks in the thick of T-ball season, the Finnish wireless giant paid the price Tuesday for a winter of pushing the wrong buttons with consumers.

As it turns out, what cell-phone users were demanding was the folding photo phone being churned out in quantity by outfits like Samsung and Motorola ( MOT). But Nokia didn't have any of these so-called midprice color-screen models, as first-quarter numbers will amply demonstrate. The strategic shortfall cost the world's largest handset maker more than 2 percentage points of market share, along with a 2% sales decline.

The sharp miss shocked investors, who had been all set for a 5% sales rise on the heels of Nokia's bullish January comments. Tuesday's reversal sent the shares down $3.47, or 16%, to $17.68.

Betting Wrong

Nokia's glowing remarks earlier this year had helped ignite a wireless sector rally. On Tuesday, rivals like Nortel ( NT) and Ericsson ( ERICY) slipped fractionally. But even as Nokia remains the most widely watched wireless industry barometer, Tuesday's setback struck most observers as being almost purely company-specific.

Indeed, observers had warned that there was a growing gap between what cell-phone buyers were shopping for and what Nokia was offering. Now it seems criticisms that Nokia was too slow to bend to the taste for clamshell-type folding phones may have been accurate.

On a conference call with analysts Tuesday, Nokia executives conceded a lack of clamshell phones was a contributing factor to the sales weakness. But the execs promised some sprucing-up was in store. The company expects to introduce 40 new phones this year, matching last year's efforts.

"There is plenty to come," said Nokia executives on a conference call Tuesday morning. "We've only seen the beginning of the array of products to come to market this year."

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