Nokia has received criticism for relying too much on the Windows Phone platform. While there are other options, such as using the Android OS, Nokia is right to persevere with the Windows Phone OS. Lumia sales have picked up in 2Q12, particularly in North America, a key market in which Nokia has struggled in recent times.
As a stand-alone OS Windows Phone will not succeed, and will remain a niche product. However, Microsoft has a huge market share in terms of desktop computers, laptops and Ultrabooks. The release of Windows 8 across multiple platforms, including the new Surface tablet, will provide the consumer with more exposure to OSs unique features and benefits, and will give the boost in sales that Nokia needs.
However, the biggest challenge that lies ahead for Nokia is maintaining its market share in China where it faces tough competition from local brands.
Admittedly Nokia is running out of time; however it still has sufficient cash to make it through subsequent quarters, and is willing to do whatever it takes, whether it be decreasing its work force or spinning off parts of the business not relevant to its central strategy, such as luxury phone brand Vertu.
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