Last year Nokia NOK -0.96%
parted ways with its luxury handset division, Vertu, selling it to a
private equity firm. Now it is Vertu’s turn to part ways with Nokia.
Vertu decided to build a phone running Google Inc. GOOG -0.22%’s
Android operating system, citing Google’s superior mobile ecosystem as
one of the main reasons. The newly launched Vertu TI, as the new handset
is called, is most likely the most expensive Android device on the
market, with the most affordable Vertu TI version retailing for around
$10,000.
Previous Vertu devices ran Nokia’s outdated Symbian software, and the
company said it was in desperate need to update software. Nokia has now
bet its future on Microsoft Corp. MSFT +0.07%’s
Windows Phone platform, but Vertu’s public relations head Jon Stanley
said Android was preferred to Windows Phone, saying it offers a richer
mobile ecosystem and greater options for customization.
Nokia — which sold
Vertu to Swedish private equity firm EQT for about 100 million euros to
raise cash — kept a 10% stake in Vertu. But the former owner said it no
longer has any operational involvement in or control of the business. A
Nokia spokesman said “it wouldn’t be appropriate for Nokia to comment on
the company’s strategy” when asked if Nokia had any objections to
Vertu’s choice of platform.
Vertu is the biggest player in the luxury handset market. Its
devices–retailing for up to $300,000–are finished with fine calf
leather, alligator skin or diamonds and are sought-after status symbols
among the wealthy elite in Russia, China and the Persian Gulf.
The pricey Vertu TI is encased by titanium, polished black ceramic
and black leather. It runs a modified version of Android 4.0, also known
as Ice Cream Sandwich, and comes with a range of Google apps
preinstalled, including Google’s suit of location services.
Vertu was founded in
1998, and is headquartered in Hampshire, southern England. While many
handset makers, including former owner Nokia, have been battered by
bruising competition from Apple Inc.'s AAPL -2.51% iPhone, and Android-running smartphones from Samsung Electronics Co. 005930.SE -0.75%, Vertu has remained profitable.
Vertu customers gain
access to an exclusive concierge service – Vertu Life — that provides a
wide range of personal services, booking and recommendations. It also
runs members’ clubs in major cities around the globe.
The unit has around 1,000 employees and has 470 points of sale
globally, including some 70 Vertu boutiques, in over 60 countries. Last
year, Vertu’s sales approached the 300 million euro mark, up from 266
million euros in 2011.
At such high sales prices, Vertu’s volumes are very small. The company has sold just 300,000 devices over the last decade.
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