Nokia and Microsoft today announced plans to form a broad strategic partnership that would use their complementary strengths and expertise to create a new global mobile ecosystem.

Nokia and Microsoft intend to jointly create market-leading mobile products and services designed to offer consumers, operators, and developers unrivalled choice and opportunity, the companies said. As each company would focus on its core competencies, the partnership would create the opportunity for rapid time to market execution. Additionally, Nokia and Microsoft plan to work together to integrate key assets and create completely new service offerings, while extending established products and services to new markets, the firms announced.

Under the proposed partnership:

• Nokia would adopt Windows Phone as its principal smartphone strategy, innovating on top of the platform in areas such as imaging, where Nokia is a market leader
• Nokia would help drive the future of Windows Phone. Nokia would contribute its expertise on hardware design, language support, and help bring Windows Phone to a larger range of price points, market segments and geographies
• Nokia and Microsoft would closely collaborate on joint marketing initiatives and a shared development roadmap to align on the future evolution of mobile products
• Bing would power Nokia’s search services across Nokia devices and services, giving customers access to Bing’s next generation search capabilities. Microsoft adCenter would provide search advertising services on Nokia’s line of devices and services
• Nokia Maps would be a core part of Microsoft’s mapping services. For example, Maps would be integrated with Microsoft’s Bing search engine and adCenter advertising platform to form a unique local search and advertising experience
• Nokia’s extensive operator billing agreements would make it easier for consumers to purchase Nokia Windows Phone services in countries where credit-card use is low
• Microsoft development tools would be used to create applications to run on Nokia Windows Phones, allowing developers to easily leverage the ecosystem’s global reach
• Nokia’s content and application store would be integrated with Microsoft Marketplace for a more compelling consumer experience

“Today, developers, operators and consumers want compelling mobile products, which include not only the device, but the software, services, applications, and customer support that make a great experience,” Stephen Elop, Nokia President and CEO, said at a joint news conference in London. “Nokia and Microsoft will combine our strengths to deliver an ecosystem with unrivalled global reach and scale. It’s now a three-horse race.”

“I am excited about this partnership with Nokia,” said Steven A. Ballmer, Microsoft CEO. “Ecosystems thrive when fueled by speed, innovation, and scale. The partnership announced today provides incredible scale, vast expertise in hardware and software innovation, and a proven ability to execute.”

Disclaimer

Nokia and Microsoft have entered into a non-binding term sheet. The planned partnership remains subject to negotiations and execution of the definitive agreements by the parties and there can be no assurances that the definitive agreements would be entered into.