An American Was the Right Call for Nokia

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September 10, 2010 9:08 PM EDT

The early returns on Nokia's change at the top are positive.

After approximately five years as chief executive officer, Olli-Pekka Kallasvuo is out at Nokia and replacing him will be Microsoft executive Stephen Elop. The move marks the first time ever Nokia has chosen a non-Finn to lead the company.

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Getting an outside person, specifically from the United States, could help boost the phone maker's chances in the smartphone market say industry analysts. While the company is still the leading cell phone manufacturer in the world, it has dragged its feet in the emerging smartphone market. As a result, it's lost significant share in the U.S. Elop's presence could change that.

"I think you can make the argument that the global handset market is Americanizing," said Neil Mawston, analyst at Strategy Analytics. "In the past, it has been driven by Japanese and European trends. Now with touch screen, internet browsing and enterprise email, it's becoming increasingly influenced by American trends. For Nokia, it makes sense to make their top position an American."

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According to research firm Gartner, Nokia's Symbian operating system will see a six percent drop-off in the global smartphone market share next year, from 40.1 percent in 2010 to 34.2 percent. Meanwhile, Android's operating system and the iPhone's iOS will increase their market share by approximately five and two percent respectively.

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In the highly coveted U.S. smartphone market, Nokia isn't even the picture. Research firm Canalys recently reported Android is tops among operating systems with 34 percent of the American market. It edged out Research in Motion by 1.9 percent.

"The U.S. is driving smartphones. Nokia had to get on the dime and re-establish," Charles King, principal analyst at Pund-IT, said. King added one of the issues with Nokia is its insular management style, where it is not willing to collaborate with wireless carrier partners as well as other manufacturers.

"That's not a winning attitude in the mobile market where wireless carriers aren't asking you to collaborate, they're demanding it. If they aren't getting it one from one, there are a dozen or more who are begging to work with them. In this regard, it was a great idea for them to go outside."

As for Elop himself, most analysts say he was a good choice. Mark McKechnie, analyst at Gleacher and Company, said Elop's technical background is impressive. "He has a good combination of software and hardware background," McKechnie said.

Prior to his job at Microsoft, where he headed up the business division, Elop was the chief operating officer of both Juniper and MacroMedia.

Mawston says Elop brings strengths in software usability and internet services to Nokia. Elop could also bring a charisma to the position that may help Nokia gain share and recognition in the U.S. market.

"His challenge will be to compete for media attention. You look at Steve Jobs. You need that kind of charisma to help interact with the U.S. media, which is so critical in developing global mindshare. This guy has a younger profile and could do that," Mawston said.

The impact of dropping Kallasvuo for Elop will likely not be felt for at least a year. McKechnie said this is the typical time period for an external CEO to make their mark. With that in mind, McKechnie echoed what is an unquestioned truth among all experts.

"He has his work cut out for him," he said.

This article is copyrighted by International Business Times, the business news leader