Nokia and Microsoft unveiled a broad strategic alliance Friday under which the two companies will develop a new mobile device ecosystem based on Microsoft's Windows Phone software to compete against rivals Apple and Google.
For Microsoft the deal could provide a boost for the Windows Phone 7 mobile operating system the company launched last year to compete against the Apple iPhone and Google Android devices. Since smartphones based on Windows Phone 7 began selling in October Microsoft has shipped about 2 million copies of the mobile OS.
For Nokia, the Microsoft relationship is part of a broader effort to turn around its struggling position in the mobile phone arena. Friday Nokia also disclosed changes in its management ranks and operational structure.
The two companies announced the relationship during a press conference in London with Microsoft CEO Steve Ballmer and Nokia President and CEO Stephen Elop, who was president of Microsoft's Business Division before leaving to take the Nokia post in September.
"Nokia is at a critical juncture, where significant change is necessary and inevitable in our journey forward," Elop said in the press conference. "Today we are accelerating that change through a new path, aimed at regaining our smartphone leadership, reinforcing our mobile device platform and realizing our investments in the future."
While Nokia is the world's largest manufacturer of mobile phones, phones based on its Symbian operating system have been losing market share to iPhones and Android-based devices.
Next: The Future Of Nokia's Symbian OS