Nokia today confirmed that it would shutter its two US stores in addition to its previously disclosed plans to close its London shop. The Chicago and New York City locations will cease running in early 2010 and are closing as the company believes it can better invest its money into sales through carriers or online sales. It has also tried to positively spin the closures by arguing that they've helped achieve the goal of improving Nokia's brand awareness in the US market.
About 90 percent of phones are bought directly through carriers, Nokia added. In the UK for example, a higher proportion of customers buy through third-party retailers like Carphone Warehouse instead of going directly through the carrier or manufacturer.
The impending closures nonetheless are most likely to reflect a lack of profitability that triggered a similar fate for the UK outlet. Nokia sold phones at its US stores at their full, unsubsidized prices, sometimes topping $500 or more, and could sometimes be undercut by online retailers.
Apple's influence has also been amplified. Both the Chicago and New York stores are both relatively short walks away from Apple's North Michigan and 5th Avenue flagships and are in smaller, less prominent locations. The iPhone's carrier deals and much higher profile in the US have similarly steered traffic away from Nokia.