Nokia Names Microsoft Executive Elop CEO
Nokia has appointed a top executive from Microsoft to replace embattled CEO Olli-Pekka Kallasvuo, announcing that Stephen Elop, president of Microsoft's Business Division, will assume the top spot at the Finnish handset giant later this month.
At Nokia (NYSE: NOK), Elop will be tasked with restoring the luster of a global giant that has fallen on hard times lately, with slumping revenues and an eroding market share. In less than two years, shares of Nokia have plummeted 75 percent.
Nokia acknowledged that Elop's central mission will be to turn the company around, citing his experience in "change management" at Microsoft as a vital asset.
"The time is right to accelerate the company's renewal, to bring in new executive leadership with different skills and strengths in order to drive company success," Jorma Ollila, chairman of Nokia's board of directors, said in a statement.
Elop will begin his new role as president and CEO Sept. 21. Kallasvuo will relinquish those positions, as well as his seat on Nokia's board, the day before. Kallasvuo will continue to serve as chairman of the board of Nokia Siemens Network, in a "nonexecutive capacity," the company said.
Nokia still claims the mantle of the world's leading supplier of handsets, but the company has seen its share of the burgeoning smartphone market wane amid the growing popularity of devices built on Google's (NASDAQ: GOOG) Android operating system, as well as the continued challenge of Apple's (NASDAQ: AAPL) iPhone and Research In Motion's (NASDAQ: RIMM) BlackBerry.
Over the past year, Nokia's Symbian operating system has seen its share of the global smartphone market decline from 51 percent to 41 percent, according to a recent report by research firm Gartner.
Another analyst shop, IDC, has projected that Nokia will dip further, forecasting that the company will command a roughly 33 percent share of the market in 2014.
IDC is estimating that global smartphone sales are on track to increase 55 percent in 2010, ahead of its earlier estimate. If that projection bears out, global smartphone shipments will reach 270 million this year, ahead of the 173.5 million units sold last year.
For Nokia, the challenge to reverse those downward trends will center around the company's efforts to launch a device that can pose a viable challenge to the iPhone and the expanding menu of Android devices.
Next week, ahead of Elop's arrival, Nokia is hosting its annual Nokia World conference in London. At that event, Kallasvuo had been expected to lay out a new corporate strategy for the company to fend off its rivals in the smartphone market, and launch a new handset, reportedly called the N8.
Elop's departure from Microsoft is effective immediately.