Cellphone maker Nokia yesterday launched its first cellphone for TD-SCDMA, the Chinese-developed 3G standard, and will enhance its cooperation in application services with China Mobile Communications Corp, the world's biggest mobile operator by subscribers.

The newly launched Nokia 6788 (N6788) mobile device is integrated with a wide range of applications including China Mobile's online software and application store, where users will find Nokia's Ovi Store to shop for music, gaming, and location and personal finance services.

Olli-Pekka Kallasvuo, CEO of Nokia, said: "Consumers will use their cellphones in new ways, so the future device will not only provide communication but also content and we expect to have 300 million active users for content by 2011."

These applications are device-based as users often access them through smart phones. In the smart phone market, the populous Apple iPhone is eating into Nokia's market share.

A survey by RBC Capital Markets showed that iPhone's smart phone market share grew to 30 percent, up 5 percentage points in the third quarter.

As Nokia reported, its smart phone market share has fallen to 35 percent in the third quarter from 41 percent in the second quarter. According to Generator Research, Nokia's market share will drop to 20 percent by 2013, while Apple's will rise to 33 percent.

The world's biggest mobile device maker has sensed the threat from Apple's iPhone and decided to catch up in the smart touch phone market.

Though Nokia reported an operating loss of 426 million euros in the third quarter, Kallasvuo said the company would still invest more in R&D for touch phones.

"Currently, we have only three touch phone models, and by next year, the product line will be extended to seven."

N6788 is expected to be available by the end of this year but the price has not been set yet. Nokia also plans to introduce more TD-SCDMA phones in the near future.

Lu Xiangdong, vice-president of China Mobile, said: "Nokia should develop as many TD-SCDMA models as its WCDMA line."

Nokia has launched 16 3G devices in China, which support all the three standards.

China Mobile has worked with 26 cellphone makers and developed more than 60 models for TD-SCDMA. China Mobile's TD-SCDMA service will be available in over 240 cities and its subscribers will exceed 3 million by the end of this year.

In January, the government issued three 3G licenses: the flexible TD-SCDMA to China Mobile, the proven technology of WCDMA to China Unicom, and the easy-to-upgrade CDMA2000 to China Telecom.