What should Nokia do?

It's hard to know what to make of Nokia these days. Though it still holds a huge worldwide market share and sells more phones than its competitors, it doesn't quite capture the buzz it once had, and its presence in the United States has dwindled.

Sure, the Finns maintain a healthy business selling low-end handsets in emerging markets, but over the last three years, smartphones are where the action is. And though Nokia still succeeds in that space occasionally--we quite liked the Nokia N8, for example--its strategy has been rather unclear.

To its credit, Nokia is aware of the problem. At last September's Nokia World, company execs vowed to "shift into high gear" and "fight back in smartphone leadership." How exactly that fight will unfold remains a popular point of debate in the wireless industry--many analysts have urged Nokia to join the Android family--but up until now, Nokia has kept its cards close.

Come next Friday, however, Nokia will fully outline its new strategy at an investor meeting in London. CEO Stephen Elop announced the February 11 meeting during the company's quarterly earnings call last week. Elop didn't get specific, but he set off a wave of speculation when he said the company needs to "build or join a competitive ecosystem."

"The game has changed from a battle of devices to a war of ecosystems," Elop said during the call. "And competitive ecosystems are gaining momentum and share." Immediately, some Nokia watchers theorized that the company would announce that it was developing a handset based on Windows Phone 7 or Android.

Such a move would be surprising, considering that as of late the company has been mildly dismissive of Android while continuing to promote Symbian and the developing MeeGo platform. But with the market throttling forward at rapid speed, Nokia may have decided the radical change is necessary. So what could its options be?

Stay with MeeGo
From what I've seen, most of my tech journalist colleagues are advocating this path. ZDNet's Mary Jo Foley, for instance, doesn't see an OS switch to Microsoft happening. Similarly, PCMag's Sacha Segan and Eric Zeman at Information Week also urged Nokia to develop MeeGo as a worthy competitor to Google and Microsoft.

Though I agree that this is the most likely scenario, I can't say that it excites me. Experienced Symbian users may love Symbian, but the OS can be maddening for everyone else. Sure, Nokia did give Symbian 3 a nice upgrade on the N8, but it needs to do more. And though I'm always a fan of customer choice, MeeGo just doesn't spark my interest at this point. It could be really cool, and I'm hoping that it is, but Nokia needs to deliver real MeeGo handsets soon.

Android
The most unlikely of the three, I'd say, but still not impossible. Indeed, jumping into Android would entail risks. The OS is growing fast and it's attracted the attention of major players like Motorola, HTC, and Samsung. Nokia would be arriving late to the party and its rivals will fight to keep the leadership positions they've assumed. On the other hand, Nokia could play an "always late, but worth the wait" role.

Windows Phone 7
Honestly, I wouldn't mind if Nokia went this route while also developing MeeGo. Windows Phone 7 is new and it has its growing pains, but the OS has a lot of promise. Nokia could benefit by getting involve with an OS from the ground up, and Microsoft--which is Elop's previous employer, by the way--could use the exposure from an industry giant.

Whatever happens, we'll know for sure next week after Elop breaks the news in London. CNET also will be at Mobile World Congress a few days after that in Barcelona, Spain, where Nokia will kick off its presence at the show by holding a press conference February 13.

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