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Nokia at the Gates of Dell

Nokia (NOK - Get Report) may finally earn its Wall Street nickname: "the Dell (DELL - Get Report) of mobile phones."

Fans of the world's largest phone maker have long feared that as smartphones become more like computers the manufacturers will succumb to the same forces that laid waste to the PC sector. Dell, Hewlett-Packard (HPQ), Gateway, IBM (IBM - Get Report) all slid into a joyless race to see who could make the most computers at the lowest costs.

Let's just say in a race to the bottom in manufacturing expenses, the U.S. is a bit outmatched. And that was true well even before the success of Asus and Acer and the ultra-cheap netbook market.

The haunting tale of the fallen PC sector comes to mind again this week after Nokia chief Olli-Pekka Kallasvuo told an interviewer on Finnish TV on Thursday that duties of computers and mobile phones are converging. When asked if Nokia was considering adding laptops to its phone business, Kallasvuo said: "We are looking very actively also at this opportunity."

For investors, there is hope that Nokia will be as ridiculously late to the netbook fad as it was with other trends, like folding phones, ultra-thin designs and touchscreens.

A Nokia laptop could easily be a more damaging flop than Palm's (PALM) short-lived Foleo notebook.

If you want a sense of what direction the convergence trends are headed, look at Apple (AAPL - Get Report). The computer maker took a bold sharp turn a few years ago. Resistant to the populist movement toward cheaper laptops, Apple instead made an expensive computer phone. Today, the iPhone is not only the design leader in smartphones, it is Apple's fastest growing product segment at a time when consumer electronics demand has flat-lined.

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