The announcement that Finnish mobile phone giant Nokia and software goliath Microsoft will join forces against industry rivals Apple and Google was met with skepticism as Nokia’s stocks fell nearly 10 percent in early trading today.
“Nokia is at a critical juncture, where significant change is necessary,” said Nokia CEO Stephen Elop in an announcement prior to an investor’s meeting in London today where the plan will be formally unveiled. “We are accelerating that change through a new path, aimed at regaining our smartphone leadership.”
In a press release today, Microsoft called the venture a “broad strategic partnership.”
“I am excited about this partnership with Nokia,” said Microsoft CEO Stephen Ballmer. “Ecosystems thrive when fueled by speed, innovation and scale. The partnership announced today provides incredible scale, vast expertise in hardware and software innovation and a proven ability to execute.”
Nokia continues to be the largest mobile telephone manufacturer in the world, but has struggled in recent years because of a failure to keep up with technological innovations. Elop, a Canadian and former Microsoft executive, was brought in last fall to try to revive the ailing company and is the first non-Finn to head the company.
Elop also announced a shake-up of some of the top management, as reported in today's edition of Helsingin Sanomat.Mark Louison, the president of the North American unit, is being replaced, and Alberto Torres, who was appointed in 2009 to head the Mobile Solutions unit, has left “to pursue other interests.”
Earlier in the week, in a memo to company employees, Elop likened the plan to having to decide whether to “stay on a burning ship or jump into icy waters.”
Under the plan, Nokia will use Windows Phone 7 platform for its new line of smartphones instead of its own Symbian software, which has been widely criticized. It will not, at least for the time being, entirely abandon Symbian, keeping it for its existing phones.