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This seems highly plausible given

1) Microsoft's $42 billion cash balance in Europe, $33 billion after Skype purchase

2) Microsoft's success with the Xbox model

3) Microsoft's looming failure with its current WP7 strategy

4) Nokia's patents and Navteq are incredibly valuable for the fight ahead.

Such a purchase would fundamentally change the landscape though. And that may come back to bite Microsoft by pushing everyone else even closer to Google. But maybe that's a moot point. Everyone has already made a broad strategic shift to Android and was only making a small hedge with a WP7 device or two.

EDIT: Looks like there's a half-denial from Nokia's Mark Squires

http://twitter.com/#!/DrPinball/status/70119002344660992

But as a 'Comm Director' he's in the business of spin and not necessarily with the deal makers. No doubt it's easy to dismiss the rumor. It's so big you have to approach it with skepticism even for the people involved.



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