Nokia CEO prepares troops to jump into the unknown — AKA Microsoft (Updated)

Update: A recent tweet by Google’s Vic Gundotra pretty much rules out an Android/Nokia partnership. Now Nokia has no choice but to partner with Microsoft.
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“We … are standing on a ‘burning platform,’ and we must decide how we are going to change our behaviour,” Nokia chief executive Stephen Elop (pictured right) wrote in an infamous memo that’s been making the rounds among news sites today.

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The memo, which clocks in at 1,300 words, was confirmed as legitimate by Engadget and is a clear sign that Elop aims to shake things up on Friday, when he’s due to unveil his new grand strategy for Nokia.

It’s a surprisingly frank read, but what struck me the most was how Elop is clearly preparing the company for a surprising, and scary, leap into the beyond.

Elop opened his memo with a parable about a man on an oil rig who woke up to find it was on fire. With seconds to react, he had to make a decision. “He decided to jump. It was unexpected. In ordinary circumstances, the man would never consider plunging into icy waters,” Elop wrote. “But these were not ordinary times — his platform was on fire. The man survived the fall and the waters. After he was rescued, he noted that a ‘burning platform’ caused a radical change in his behaviour.”

After reading that passage, it sounds almost as if Elop is planning to strike a deal with the devil on Friday — and the most likely devil, of course, is Microsoft. Partnering with the software giant is indeed something that Nokia would never consider if all was going well, but with its platform on fire, the company needs to do something quickly to save itself.

A Microsoft and Nokia partnership would be beneficial to both companies. Windows Phone 7 is a surprisingly strong mobile entry for Microsoft, and if paired with Nokia’s strong hardware, it would give the company some killer phones that could compete against the iPhone and Android platforms. Microsoft, meanwhile, would be able to take advantage of Nokia’s popularity in Europe and other countries to help spread the popularity of Windows Phone 7.

Of course, another possible devil is Google, but there are a few reasons why Nokia won’t adopt Android. For one, Elop hails from Microsoft, so he already has plenty of connections there. It’s also becoming increasingly difficult for Android phone manufacturers to differentiate themselves. Samsung went all-in with its Galaxy S phones last year, and both Motorola and HTC continue to pump out high-quality phones. It would be tough for Nokia to stand out in that crowd.

Many are also hoping that Elop will unveil Nokia’s long-awaited MeeGo mobile operating system on Friday. While it may make a brief appearance, Elop makes it clear in his memo that MeeGo isn’t going to save the company anytime soon. He said that at its current rate, Nokia may only have one MeeGo product on the market by the end of the year.

Elop is well aware that Nokia is being attacked on all sides. On the high end, Apple rules with the iPhone, and Android is quickly gaining in popularity. On the low end, Chinese manufacturers are pumping out cheap phones at an insanely fast pace. And when it comes to the middle range, Nokia is finding that its Symbian OS is showing its age. The company is also facing declining consumer preference in the UK, Russia, Germany, and other countries where it normally has a strong presence.

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How did Nokia lose its way? Elop writes in the memo: “We poured gasoline on our own burning platform. I believe we have lacked accountability and leadership to align and direct the company through these disruptive times. We had a series of misses. We haven’t been delivering innovation fast enough. We’re not collaborating internally.”

For once, Nokia’s leadership seems ready to confront the company’s problems. Hopefully on Friday, Elop will find some way — be it with a Microsoft partnership, or some sort of other surprise — to fix the company’s immediate issues and ultimately get us excited for Nokia phones once again.