Ever since ex-Microsoft executive Stephen Elop suddenly and unexpectedly bolted from the software giant to run ailing mobile handset maker Nokia, rumors have swirled that he would engineer an alliance between the two firms and bring Microsoft's Windows Phone software to Nokia. This week, the rumors are back, and if true, it's possible that Windows Phone-based phones could be sold alongside Nokia devices based on Symbian and MeeGo.
Rumors of a Nokia/Microsoft linkup date back to September, when VentureBeat published a report stating that Nokia was "likely" to use Windows Phone as an "additional platform" alongside its flagship but aging Symbian software. However, Nokia immediately shot down the report and refuted the rumors. "We have no plans to use other operating systems," a Nokia representative said emphatically the next day.
Case closed? Not yet: This week, a Russian blog that had previously scooped the world with its early review of a Nokia smartphone said that Nokia and Microsoft have entered into talks to expand their relationship. And according to this source, the expanded relationship will include a new line of Nokia phones running Windows Phone.
Nokia and Microsoft already have an established relationship that the companies have described as unprecedented in "scope and nature." Part of this relationship involves the first-ever porting of Microsoft's Office Mobile software to a non-Microsoft smartphone platform, though that software has yet to see the light of day. Nokia also shipped its first-ever netbook computer, the Booklet 3G, last year, based on Microsoft's Windows 7 OS for PCs.
Nokia had previously stated that it would focus on its own mobile operating systems, including Symbian, which is broadly deployed but very dated, and the Linux-based MeeGo system. But the company has experienced numerous problems and delays with these new systems, and its newer smartphone models have floundered in the market.
The risks here are huge for Nokia, which has watched its dominance in the smartphone market evaporate in the face of more capable devices from Apple, Google, and now Microsoft. (Most of Nokia's current phones don't technically even qualify as smartphones, based on the ever-evolving definition required by more capable competing phones.) Nokia can't simply abandon its own technology and become yet another Windows Phone partner, but if it devotes too little attention to Windows Phone, it runs the risk of not succeeding with those devices either. Either way, it could easily lose market share and market prestige.
A Nokia alliance could strongly bolster Windows Phone, however, and that could go a long way toward explaining the silence from Microsoft since that system's launch in October: Perhaps the software giant is getting ready to overhaul Windows Phone to accommodate the needs of a major new partner with access to huge global markets. The effects could be wide-reaching and, hopefully, quite positive.
So is the rumor true? We could find out as soon as early January, when Microsoft hopes to make a big splash at the annual Consumer Electronics Show (CES) in Las Vegas. There, the company is expected to announce yet another round of iPad-like tablet devices and, we hope, an update on Windows Phone.