Windows Phone 7 Coming To Nokia?

Microsoft and Nokia are in talks that could result in the Finnish phone maker building a new line of smartphone's based around Microsoft's Windows Phone 7 operating system, according to a tech blogger who closely follows Nokia.

Nokia CEO Stephen Elop

Eldar Murtazin, who operates from Russia, said that Nokia, which is now run by former Microsoft Business Division president Stephen Elop, initiated the discussions, according to reports. Nokia and Microsoft have not commented on Murtazin's claim.

It's not the first time rumors have swirled about a possible Microsoft-Nokia phone partnership. Such talk has been rife in the blogosphere ever since Elop left Microsoft to take the CEO job at Nokia in September.

Elop's arrival shook up Nokia's phone business, which has been largely centered around the Symbian open source OS and Nokia's own technology.

Nokia Mobile Solutions executive VP Anssi Vanjoki stepped down after Elop came on the scene. Vanjoki was at one time thought to be a possible successor to former Nokia CEO Olli-Pekka Kallasvuo.

Some analysts believe Vanjoki, a 29-year veteran of Nokia, felt spurned by the company's decision to give Elop the top job. But his departure has left Nokia free to pursue new directions in the mobile market.

A partnership with Nokia could help Microsoft broaden the appeal of Windows Phone 7, particularly in Europe—where Nokia remains a market leader. Microsoft has not provided any early sales data for Windows Phone 7 since launching the OS in October. The company's silence on the issue has led some analysts to question whether the product is faring poorly with consumers.

Many observers feel Windows Phone 7 represents Microsoft's last chance to be a legitimate player in the smartphone market, where it trails RIM, Apple, and newcomer Google. In the U.S., T-Mobile is offering Windows Phone 7 phones from Dell and HTC, while AT&T is offering devices from HTC and Samsung.

Gartner predicts the release of Windows Phone 7 will help bump Microsoft's share of the worldwide mobile OS market from 4.7% in 2010 to 5.2% in 2011, but says the company's share will ultimately fall back to just 3.9% by 2014 as Apple and Google continue to build share with the iPhone and Android, respectively.