March 19, 2011

Elop: Windows Phone In The Works

Nokia Chief Executive Stephen Elop said Friday that work has started on the first Nokia Oyj smartphones based on Microsoft Corp software following the partnership announced by the companies last month.

Elop left Microsoft last year and was recruited to join Nokia to help save the company from increasing irrelevance at the high end of the market.

He said he could see no good reason for the speculation that Microsoft might try to buy Nokia.

"I'm not aware of a strategic interest that Microsoft would have in the rest of the business. To the extent that a partnership has been formed around what they're really interested in, then what would an acquisition bring other than a good year of anti-trust investigation, huge turmoil, delays?," Elop told Reuters reporter Georgina Prodhan.

Nokia shares have dropped almost 30 percent since the agreement with Microsoft was announced.

About half of Nokia's handset revenue comes from more basic mobile phones.  The company is struggling to keep up with the Apple and Google dominated U.S. market.

Elop said Windows-based Nokia phones will go on sale from 2012, although he admitted to Reuters that he feels under pressure and would prefer to deliver one by the end of 2011.

"We're right now, today, having people work on the first Windows Phone devices from Nokia. That work is already under way. If this was an acquisition scenario, that wouldn't be possible," Elop told Prodhan.

Elop said the deal between Nokia and Microsoft is expected to be finalized in the next couple of months.


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