Nokia Shuts Down Two China-based Offices As Troubles Persist

Nokia is shuffling its operations in China as it hopes to better address the largest smartphone market in the world.

The company confirmed to the Wall Street Journal that it would close its operations in Chengdu and Shanghai, but increase the size of its operations in Beijing and Guangzhou.

Once a major player in China, Nokia has watched its market share fall there just as it has elsewhere around the world. But if the company wants any real shot at a comeback, it will need a strong presence in China, similar to its need to be more visible in North America. China, with a massive amount of consumers looking to upgrade to smartphones, represents a large untapped opportunity for everyone in the mobile business.

Nokia CEO Stephen Elop talked about the opportunities in China back in April, when the company had signed a new deal with China Telecom. At the time, he had vowed to expand to more carriers and it looked to expand its footprint in the region.

The reshuffling, however, suggests the expansion is not without its complications. The moves are part of broader cuts June made, which involved cutting 10,000 jobs and changing the management team around.

With Nokia committed to Windows Phone, the company has watched vendors using Android take its market share away. Globally, Samsung Electronics is the leader in smartphones, although Chinese vendors such as Huawei and ZTE have increased their presence in their home market, often at the expense of Nokia.