Nokia's PC Booklet Needs Telco Help

NEW YORK ( TheStreet) -- Nokia ( NOK) takes a plunge into the PC market Tuesday with the introduction of its first netbook computer.

The device, called Booklet, runs on the new Microsoft ( MSFT) Windows 7 operating system and Intel's ( INTC) stripped-down Atom chip. The slim metal body appears to some a close approximation of Apple's ( AAPL) MacBook and boasts a 12-hour battery time. The Booklet includes GPS and WiFi and 3G wireless, which is expected to be sold through a telco partner like AT&T ( T), though no carrier has been named yet.

Nokia is expected to unveil the Booklet at a media event in New York Tuesday.

Nokia Booklet's Price Problem

For Nokia, netbooks represent a bold if not late strategy to claw back some of the business it has been losing in the smartphone market to Apple and Research In Motion's ( RIMM) BlackBerry. The Booklet is the first of a range of mobile computing devices Nokia is expected to have this year and later next year. This summer, Nokia introduced a handheld mobile computer that uses a Linux-based Maemo operating software.

Nokia hired contract manufacturer Foxconn to produce the Booklet in time for the holiday gift-buying season. But Nokia's late entry into the netbook market comes two years after low-cost producers like Asus and Acer have dominated the segment.

The price of the Booklet hasn't been disclosed yet. But so far, telco-subsidized netbooks have been only modestly successful because the data plans run about $1,200 over the course of a two-year contract.

Nokia's venture into the computer market could prove challenging as it tries to find a fit between cheaper netbooks and a host of sleeker more powerful notebooks from Dell ( DELL), Hewlett-Packard ( HPQ) and Apple.

Palm's ( PALM) brief and brutal failed experiment with Foleo was a similar effort by a phone maker to expand beyond smartphones into netbooks. For the Booklet to succeed, Nokia needs the support of telcos, an area where the Finnish phone giant has been particularly weak.

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