I had spoken to Horace Dediu of Asymco in December for a story on what options Microsoft and Nokia had before them, and here are some of the relevant parts he told me (the article itself doesn't seem to have been put online at Forbes India, who I used to write for but no longer do):
>> Coming to the present, the biggest problem that Microsoft and Nokia will face is that of timing. Specifically, at what stage are we when it comes to global penetration of smartphones?
>> Today now that the market is over 1 billion users and going to very rapidly saturate, the challenge for Microsoft is their assumption of wanting to keep on trying hoping to succeed one day. It's hard to believe that after so many tries and so much saturation, they can succeed. Worse, their strategies are symmetric, meaning they compete against an Apple or an Android by claiming their Lumia devices are better.
>> If Microsoft and Nokia can pivot and become a low-end competitor then there may be an opportunity still available in emerging markets. But instead they’re pouring tremendous resources into the US and Europe saying Lumia is better. That will fail. The door for Windows Phone is closing not because of Apple and iOS but because of Google and Android. Nokia, the bulk of whose phome portfolio was in the mid-market, was defeated by Android. I could argue, with difficulty, that they can still get into the late stage market but I haven’t seen a message from them indicating that. They simply aren't humble enough to see that market as their core, but still see their platform as superior to all others.