With less than a fortnight to go for their joint announcement on September 5, Nokia Corporation (ADR)(NYSE:NOK) and Microsoft Corporation(NASDAQ:MSFT) are busy putting in place all the other pieces that is expected to give them a leg-up in the smartphone sweepstakes.
The Finnish handset maker has decided that sticking to Windows is the smart thing to do after junking its Symbian operating system. Indeed the Windows mobile operating system, a new entrant into the area, has significantly raised its market share, though it is still minuscule when compared with Apple's iOS or Google's Android.
Nokia has become the largest alliance partner of Microsoft in the mobile space. Localytics recently said that Nokia had "cemented itself as the world's Windows Phone manufacturer" accounting for close to 60 percent of all global Windows phone devices.
The other major piece of the puzzle that has fallen into Nokia's lap is that of Verizon. America's No. 1 network carrier is now planning sell Nokia's new Windows-based device - renewing an alliance with Microsoft after more than a year.
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Nokia already has an existing relationship with No.2 carrier AT&T - so having the two largest network operators on its side means Nokia is in a good position.
So far the leading phone companies have been working with Apple's iPhones and Google's Android devices, since they are the dominant players in the smartphone segment.
But they are now looking to reduce their dependence on Apple and Google, and have a wider choice of partners with whom to work. It is more so in the case of Apple because the iPhone comes with a lot of subsidies and network providers have very little control over it.
Shares of NOK soared 11.11% to $3.20 on Thursday, extended its weekly gain to 16%.
Elsewhere, A lot is riding on the expected release of new iPhone 5 from Apple. The fortune of a lot of network operators and telecom equipment firms are being closely pegged to that event.
Christopher Larsen, analyst at Piper Jaffray, said that that he maintained his Overweight rating on the stock of Sprint Nextel Corporation(NYSE:S) based on customer perception of the upcoming iPhone and also about upgrades to 4G networks.
“Based on the results, we don’t believe the lack of a substantial 4G LTE network will materially hurt Sprint when the iPhone 5 is launched,” Larsen wrote in his research note.
“We were concerned that Sprint’s late start in deploying LTE could hurt it when the iPhone 5 was launched (expected at the end of September). The results of our survey alleviated most of this concern.”
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The survey conducted by Jaffray showed that 47 percent of those surveyed felt they did not need 4G while about 26 percent felt that all 4G network technologies were the same.
Sprint shares ended down 4 cents at $5.04 a share.