Nokia (NYSE:NOK) has the leading market share among mobile phone makers. Unfortunately, its massive size keeps Nokia from generating the kind of growth that excites shareholders. What's more, the company is facing tougher competition, especially from Motorola (NYSE:MOT) and its booming Razr phones.

While the stock market had a strong day yesterday, Nokia's stock price fell $0.29 to $18.20 on lackluster fourth-quarter results. The company posted profits of $1.32 billion, down 1% from the year-ago period. During this time, sales increased 9% to $12.66 billion. In all, the company has about 34% of the worldwide share for mobile phones.

Like many big companies that are frustrated with their stock price, Nokia said that it will enhance its stock buyback program to $8 billion. (That's usually a non-event for investors.)

Nokia is experiencing strong growth in markets such as China, India, and Russia -- but its margins on these sales are much tighter. Nokia's emerging-market strategy places a priority on getting there first; China and India are on their way to becoming wealthy nations, but they're not there yet, which means that price points on Nokia's initial offerings have to stay low. Nokia apparently hopes that its customers will upgrade to better phones over time, and that its costs will become more scalable as the company gains more experience in these new markets.

Alas, Wall Street is mostly looking for short-term results. But for those investors willing to wait, Nokia is a good play on the long-term growth market for mobile phones in developing nations.

Still, when gauging Nokia's future competitive strength, keep in mind that the company's latest phones just don't have the pizzazz of Motorola's sleek and snappy designs. Nokia's North American sales were quite weak during the past year; even the company's CEO indicated problems with its product line.

Nokia plans to launch snazzier phones in 2006. But the competition will doubtlessly keep pace, and it will take time for Nokia to get results. In the meantime, investors should expect more of the same from Nokia's stock: a steady dial tone.

Fool contributor Tom Taulli does not own shares mentioned in this article.