Will it be Android or Windows riding to the rescue of embattled Nokia?

One of them certainly needs to or Nokia, still the world’s biggest volume mobile phone seller, will be in the same dire position that Motorola (aeons ago the top company) found itself in.

Finland-based Nokia has seen its global market share reduce from nearly 40 per cent a year ago to 31 per cent as Apple’s iPhone and Google’s Android system have gobbled up the smartphone market. And everyone these days wants a smartphone, whether they need one or not.

So far it has stuck with its Symbian operating system but that seems a dead duck (or dead chimp) and its more advanced MeeGo (it probably loses something in translation from the Finnish) has a lot of catching up to do.

New CEO Stephen Elop, a former Microsoft executive, says he’s considering using one of Android (which is free) and Microsoft’s Windows technology that it uses for its new Windows Phone 7 to power the company’s new phones.

But only in the United States, which seems a bit bizarre.

Elop clearly fears that Nokia will be reduced to the status of Motorola or Sony Ericsson, effectively packagers and marketers of Android, if he gets out of the operating system game.

But maybe there’s a better, if riskier, deal on the table with Microsoft. Windows Phone 7 works OK apparently but its modest proposition – it’s a simple phone that lets you get on with the rest of your life – has, perhaps predictably, failed to fly and it’s struggling for sales in the US.

If it does end up bombing this will be the second time that Microsoft has failed to crack the handset market. Maybe Microsoft needs a partner, as opposed to a customer, just as much as Nokia does.

And Elop at least knows Microsoft’s terrifying CEO Steve Ballmer well, which may or may not help.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.