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Microsoft, Nokia in Opposite Smartphone Directions – But an Alliance?

In the race to see who would be the next third option for a quality smartphone, it seems that Microsoft Corporation (NASDAQ:MSFT) and Nokia Corporation (ADR) (NYSE:NOK) have been going in opposite directions – one is late to the party but is building up some loyal name-recognition momentum, while the other company established in mobile for years is falling further and further behind. There was more evidence of this from a post written last week about the International Data Corporation’s quarterly survey of smartphone shipments.

Stephen Elop & Steve Ballmer

The survey showed that Microsoft Corporation (NASDAQ:MSFT) was gaining market share within the smartphone market, increasing its footprint in the market by more than 275 percent in one year, up to about 5 percent of the market. Microsoft’s Windows Phone operating system was nver new to the marketplace a year ago, but it has steadily grabbed more territory while Apple Inc. (NASDAQ:AAPL) iOS and Google (NASDAQ:GOOG) Android competes for the title of Operating System of Choice.

And where is Nokia Corporation (NYSE:NOK) is this battle for smartphone supremacy? Well, it’s prety much nonesistent, and has been losing market share in the overarching mobile phone market for a while now. But after this recent report (which we reported last week) about Nokia Corporation (NYSE:NOK) offering Windows Phone 8 as its operating system, could these two companies, which had been battling for the same mobile-phone market, actually help each other?

Microsoft is certainly lookking to get its Windows Phone OS into as many phones as possible, and contracting with companies like Nokia and others might be the quickest way to do it, rather than created its own phone. Based on the brand recognition and brand loyalty for Microsoft Windows, perhaps the best way Nokia could rally in the phone market as a whole is to ride on the coattails of Windows Phone 8 when it is released later this year.

Too competitors will actually become allies in the battle to take away market share from Apple and Google. Both Microsoft Corporation (NASDAQ:MSFT) and Nokia Corporation (NYSE:NOK) have a lot to lose with this joint venture, but oh so much to gain, considering where the two companies are now in terms of the marketplace. Lots of upside potential, as it were.

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