Tense time for Nokia as all hangs on Windows 8 launch

Last throw of the dice for CEO Stephen Elop?

Investors in troubled Finnish mobile maker Nokia have an anxious few days ahead as they await the launch of Windows Phone 8 in San Francisco. The debut of Microsoft’s new OS on Monday week [29th October 2012] could prove even more crucial to Nokia than for the Seattle software giant itself, given the phone maker’s continued slide and the fact it is pinning its hopes on Windows Phone 8 to revive its fortunes. Two days ago Nokia posted its sixth straight loss with Q3 results showing a $1.27 billion deficit – almost double the loss for the same period a year ago. To reduce costs the company’s CEO Stephen Elop, himself a former Microsoft executive, has axed 20,000 jobs and cut manufacturing and research sites.

But he has also gambled the manufacturer’s future on phones running Windows Phone 8, jettisoning Nokia’s own Symbian Os in the process.

Thursday’s results also showed that sales of Nokia’s flagship Lumia smartphones, running Windows Phone 7.5 (Mango), fell to 2.9 million units from the previous quarter’s 4 million – with matters not helped by Microsoft’s earlier announcement that handsets running Windows Phone 7 would not be updated to the more sophisticated Windows Phone 8. Nokia’s only bright spot was stronger-than-expected sales of its low-cost Asha handsets.

On Monday week Taiwanese manufacturer HTC will also be unveiling handsets running the new OS, giving Nokia further competition as it chases the tails of Apple and Google with its Android ecosystem.

Meanwhile some analysts are wondering whether Nokia has made a fatal mistake in aligning itself so closely with Microsoft and its new OS which, if it fails to catch on, could prove ruinous for the Finnish manufacturer.

Smartphones running the Microsoft program have significantly failed so far to threaten Apple and Google’s lead, having a market share of 2.7 per cent in Q2 2012, compared with 83 per cent for the iPhone and Android devices combined according to reseach firm Gartner.