Basically Nokia could have ended the smartphone war by joining with Android. But ironically, that makes them more valuable to Microsoft. This is just the same as Microsoft paying people to build apps for WP7, paying Verizon to use Bing, or paying devs not to release games on PS3 but on a massive, multi-billion dollar scale. It's a bit tragic when the greatest value your company can offer is to be paid to not join the dominant ecosystem in exchange for a cut of a desperate monopolist's war chest, but that's why you need to bring outsiders with no emotional attachment to your products in to do it.
So basically he wanted to "create a challenger" because Microsoft would pay them handsomely to do so. And if it doesn't work out, it's not like Android is going anywhere, so they've got a Plan B. (Though to be honest I think they're currently splitting the company into two pieces, the bit that will wring any remaining revenue from Symbian then close, and the bit that Microsoft will buy once they've sacked anyone Microsoft doesn't need. Microsoft will then try the PlaysForSure -> Zune thing again.)