This is a big week for Nokia when they are expected to unveil their first new smartphones based on the Windows Phone operating system.

How well these smartphones are received could determine whether Nokia will even survive as a business.  Just last December Nokia had 28% of global smartphone sales and that share fell to 15% last month.  No doubt it is headed lower even if the new phones are a hit.  The question is whether there is a bottom and recovery based on market acceptance of a third smartphone alternative behind iPhone and Android.

Smartphone sales now account for half of all phone sales in North America and Europe and that amount is increasing as consumers increasingly enjoy the features, especially social networking features, that smartphones offer.

For what it’s worth Nokia was smart enough to realize its internal efforts were lacking in comparison to Apple and Google.  While CEO Stephen Elop toyed with adopting Android, he decided on a strategy of differentiation where Nokia phones will certainly not be considered “me too” devices.

While both iPhone and Android devices are grids of icons across the screen, the Windows Phone look and feel is more whitespace and typography, choosing text over graphics to convey information.  The big gamble is whether that different interface will appeal to consumers or not.

Microsoft does know how to deal with developers and there will be apps available for these phones.

Believing there is room for a third player and that Nokia does hardware well as Microsoft does software, technology research firm Gartner is projecting success with a 20% smartphone marketshare for Nokia by 2015.  That would be turning the ship around and recovery for Nokia.  Yet it’s just a prediction.

My own belief is that there is room for a third player because smartphones are just not that expensive and people will be happy to ditch what they have and try something new even just for the sake of trying something new.  The opportunity is there, the key is execution and Microsoft will deliver software and Nokia will deliver the hardware.

So I see “NokiaSoft” gaining a piece of the action, but not changing the game.  The two software frontrunners, Google and Apple, and the two hardware frontrunners, Apple and Samsung, are entrenched and going to keep on growing.

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