Nokia plans on using Microsoft's upcoming Windows Phone 7 as a smartphone platform, according to an unnamed source talking to Venture Beat. That would expand Microsoft's mobile footprint in its competition against Google Android, Apple's iPhone and RIM's BlackBerry franchise.
If that rumor proves true, it could be a sign that Nokia's new CEO, former Microsoft Business Division President Stephen Elop, is leveraging his relationship with his former company to accomplish strategic aims for his new one. Although Nokia holds a strong international position, the company never managed to gain a beachhead in the United States that would allow it to challenge either Android or the iPhone, considered the two top franchises in this country's consumer smartphone space.
Using Windows Phone 7 in addition to its existing smartphone platforms, however, might give Nokia the sharper nails it needs to claw out some additional market share among American consumers. A September research note from IDC predicted that, although Nokia's share will continue to dip through 2014, Microsoft's could increase from 6.8 percent to 9.8 percent.
Microsoft was markedly noncommittal about Elop's leaving earlier in September.
"I am writing to let you know that Stephen Elop has been offered and has accepted the job as CEO of Nokia and will be leaving Microsoft," Microsoft CEO Steve Ballmer wrote in a Sept. 9 e-mail to company employees. "Stephen leaves in place a strong business and technical leadership team, including Chris Capossela, Kurt DelBene, Amy Hood and Kirill Tatarinov, all of whom will report to me for the interim."
Ballmer added: "I appreciate the way that Stephen has been a good steward of the brand and business in his time here, and look forward to continuing to work with him in his new role at Nokia."
Whether Elop left on positive terms with his former colleagues, Nokia and Microsoft actually have a history of partnership in the smartphone arena. In August 2009, the two companies announced that mobile versions of Microsoft Office would be preloaded onto Nokia smartphones, to be followed in time by other applications such as Microsoft SharePoint. At the time, Nokia also announced that it had begun work on optimizing Microsoft Exchange ActiveSync for its devices, allowing more streamlined direct access to e-mail and personal information.
But Windows Phone 7 will also compete against Nokia's phones running its proprietary operating systems. Microsoft and its manufacturing partners will reportedly launch the first Windows Phone 7 devices in either October or November, even as Nokia preps its own smartphones-including the Nokia N8-for release this fall.
For its part, Nokia intends Elop to spark a transformation in the company's mobile fortunes.
"The time is right to accelerate the company's renewal; to bring in new executive leadership with different skills and strengths in order to drive the company's success," Jorma Ollila, chairperson of the Nokia Board of Directors, wrote in a Sept. 10 statement. "The Nokia Board believes that Stephen has the right industry experience and leadership skills to recognize the full potential of Nokia."