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Nokia Says It Stands 110% Behind Windows Phone

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Stephen Elop, CEO of beleaguered Finnish cell-phone maker Nokia (NYSE: NOK  ) , emphatically stated there would be no question of having Nokia switch smartphone operating systems.

"I don't think about rewinding the clock and thinking about competing elsewhere. ... In today's war [between] Android, Apple, and Windows, we are very clear. We are fighting that with the Windows Phone," he told a group of reporters staking him out in Oslo.

Those are brave words, indeed. So far, the Microsoft (Nasdaq: MSFT  ) mobile OS has not made a dent in Apple's (Nasdaq: AAPL  ) and Google's (Nasdaq: GOOG  ) dominance of the worldwide smartphone OS market. And, so far, Nokia's first Windows Phone models running version 7.5 of the OS have not elicited much excitement in either Europe or the United States.

But Elop's never-say-die remarks are based on the expected upcoming release of Nokia's Windows Phone 8 handset. Elop wouldn't give a specific date for any such launch, but he didn't say no to a date in September. The only thing reporters could get out of him was that the release would be "relatively near term."

Better never than late?
There has been some wondering about why Nokia did not go with the successful Android OS rather than Windows Phone OS to replace the company's homegrown but increasingly unpopular Symbian OS. Symbian has dropped from a 22% market share of all mobile phones a year ago to less than 6% in the quarter just ended, according to Gartner, a technology research firm. Total Windows Phone share was 2.7% in that quarter.

Meanwhile, Standard & Poor's has done a bit of piling on, dropping Nokia's credit rating even deeper into the nether regions of junk bond status. The latest downgrade from S&P brought Nokia to BB-, down from BB+. This was the second downgrade from S&P since April. Nokia has also taken downgrade hits from Moody's -- three since April -- and one from Fitch four months ago.

And there may be more.

"The negative outlook reflects the possibility of another downgrade if Nokia fails to stabilize its margins and significantly cut its cash losses," S&P said.

Nokia shook off the ratings agency's remark. The negative effect of S&P's action was "limited," CFO Timo Ihamuotila said. "As we continue our transition, we are applying a strong focus on cash conservation while simultaneously reducing our operating costs."

Nokia's supposed September release of its Windows Phone 8 handset may occur at the company's trade show in Helsinki on Sept. 5 and 6.

Apple, meanwhile, is expected to announce its latest iPhone on Sept. 12. As the company that basically wrote the smartphone OS rulebook, its iPhone is still the device that all other phones aspire to be like. To get the full scoop on one of the preeminent names in technology today, grab your copy of the Fool's new premium report on Apple. It comes with a full year of updates, as well as an overview of the must-know opportunities and threats for every Apple investor.

Fool contributor Dan Radovsky owns shares of Nokia. The Motley Fool owns shares of Apple, Google, and Microsoft. Motley Fool newsletter services have recommended buying shares of Google, Microsoft, Moody's, and Apple, creating a bull call spread position in Apple, and creating a synthetic covered call position in Microsoft. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days. The Motley Fool has a disclosure policy.

Read/Post Comments (3) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On August 16, 2012, at 12:20 AM, techy46 wrote:

    Another article full of anti-Nokia and Microsoft FUD by the Apple and Google hucksters from Wall Street. The 7 million early adopters of Nokia's Lumia WP7 phones are very exciting about how good Lumia's are and totally satisified not to be carrying a girly iPhone or socialistic piece of Google's advertising virus.

  • Report this Comment On August 16, 2012, at 1:44 AM, ajaykc wrote:

    First of all, I don't know what this author wants to convey. This article has lot of grammatical errors which shows the quality of this article and how much time was given to write this article. It doesn't add any value to the reader. We already know everything, no new information.

    If its raining then it doesn't make a difference how many analyst come and say that its raining unless "I am deaf and blind" that I can't hear the noise of the rain drop or can't see it raining.

    It doesn't take a genious to come and say "Nokia has issue and cash burn is a problem, they are closing plants, blah blah blah". About future, they don't know anything just like anyone else and guessing. S&P already had Nokia's credit rating on junk status and now one more downgrade, it doesn't make a difference (Moody's Fitch have said the same thing).

    The timing of this downgrade is very ill-fated. S&P has every reason to talk down on Nokia to kill the excitement of WP8 and investors and traders have shown their verdict.

    S&P is same company which said there was no subprime bubble in 2007 and we all know. Gold bubble, what's that? There analysts are always behind. Believe it or not. I WISH IF S&P WAS AN INDEPENDENT AND HONEST RATING AGENCY.

    I bet, Sprint is going to see a bunch of upgrades tomorrow as its stock have jumped like crazy without any fundamental change.

  • Report this Comment On August 16, 2012, at 7:13 AM, fundementalist wrote:

    "iPhone is still the device that all other phones aspire to be like". Really? I guess I'd better glue the back of my Android phone shut so I can't upgrade my battery and memory, or change a SIM card, then it can be just like an Iphone. I'm not even sure why windows 7.x is being discussed, clearly a second place OS, which is why windows 8 (tile versus menu based) is set to supercede it. the battle will be between between google phones and windows 8 phones, with the Iphone sheep clinging to Apple with protestations of superiority. Haven't we seen this play out in the PC market already? History repeats itself.

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