- Associated Press - Friday, September 10, 2010

HELSINKI (AP) - Nokia Corp. is replacing CEO Olli-Pekka Kallasvuo with Microsoft executive Stephen Elop as the world’s top maker of mobile phones aims to regain lost ground in the fiercely competitive smart phone market.

The choice of a North American executive to lead a Finnish company reflects the increasing dominance of U.S. and Canadian companies in the evolution of the phone business.

Apple Inc.’s iPhone has set the standard for today’s smart phones, while Research In Motion Ltd.’s BlackBerrys are the favorite of the corporate set. More recently, Google Inc.’s Android software has emerged as the choice for phone makers that want to challenge the iPhone.

Analysts welcomed the choice of the 46-year-old Canadian, who has worked closely with Nokia at Microsoft and at Macromedia Inc. developing software for Nokia phones. He has also held top posts at Juniper Networks Inc. and Adobe Systems Inc. At Microsoft, he headed the Business division, which makes Office software.

He takes over Sept. 21, Nokia said Friday.

The company’s share price jumped more than 6 percent on the news, but closed up only about 1 percent at euro7.79 ($9.91) on the Helsinki Stock Exchange.

It was the first time that Nokia, considered by many as part of the Finnish national identity, chose a non-Finn to lead the company that grew from producing rubber boots to leading the world in making handsets.

Elop, observing that Canadians and Finns both hail from northern climes, was quick to allay fears he might move company headquarters abroad. Nokia is an outsized part of the small Nordic country’s economy _ and self-image.

“This is the home of Nokia, it will continue to be the home of Nokia, and I just love being in these facilities,” Elop said. “At the same time recognizing that while it is a Finnish company it is also a global company and there are employees and partners and customers of Nokia all over the world.”

Finnish Prime Minister Mari Kiviniemi and Finance Minister Jyrki Katainen expressed satisfaction that Nokia was not planning to move.

“We have know-how, research and product development here. We also have an integrated and stable society to offer,” Kiviniemi said.

Nokia accounts for 1.5 percent of the small country’s gross domestic product and provides employment, including through subsidiaries, for some 60,000 workers in the country of 5.3 million.

Katainen said it was up to the company to decide on executive matters, including location of headquarters, adding that “what’s good for Finland is that Nokia is successful.”

With Nokia stock down more than 20 percent this year after two profit warnings, Nokia veteran Kallasvuo had come under increasing pressure.

Jorma Ollila, chairman of the board and former CEO credited with developing the Finnish company to an international leader in mobile phones, said Elop has “a strong software background and proven record in change management” to help Nokia meet new challenges.

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