Nokia is gearing up for N-Gage's launch

Nokia has announced it will acquire Sega's multiplayer online games assets, a computer server technology at the core of networked game play.

"This transaction will give Nokia full end-to-end capabilities - the device, the games and the back-end technology to support multiplayer gaming," said Ilkka Raiskinen, senior vice president of Nokia's entertainment and media business unit.

Mobile phone firms have become increasingly desperate to find alternative revenue sources to boost profitability in Europe's saturated mobile market.

Stagnation

Nokia is releasing its N-Gage phone/gaming device on 7 October, and will go head to head with Nintendo's Gameboy which currently dominates the market for mobile gaming.

Analysts said the acquisition, although financially immaterial, demonstrated Nokia's commitment to making sophisticated gaming a priority for its new phone designs.

Nokia commands 37% of the world's mobile phone market but has suffered steep declines in profits nevertheless as the mobile market stagnates.

N-Gage, a two-handed games console that can also be used as a phone, will go on sale for about $300 (�190).