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Will Nokia, Microsoft Make Life Tough for Apple in China?

Stocks in this article: NOK MSFT AAPL

Please don't misconstrue what I am saying here.

I am on record with what is a pretty sensible prediction -- Windows Phone will become a formidable number three to Android and Apple in the mobile market. That will be enough to lift the stock prices of both MSFT and NOK and turn Nokia back into somewhat of a player again. That's why I do not see the coming Windows 8 challenge as "a dichotomous battle between good and evil."

There's more than enough room for several operating systems to co-exist in a world where smartphone adoption runs off of the charts.

Of course, the 0.1% (that represents the proportion of rabid AAPL permabulls who make passionate comments on articles to the overall readership of the article) will call me names like "hack" and worse. They'll claim that nobody reported this story because it's not news. It's a temporary bump for something shiny and new.

Maybe so. But it's worth keeping an eye on.

For Nokia and Microsoft, it's a big deal. While the rest of the world seems to think the recent Lumia launches represent the company's major pushes, they're tantamount to test runs. The real deal comes when Windows 8 smartphones and tablets hit the market later this year. In other words, you really have not seen anything yet.

If the China trend continues, it will not make Windows Phone No. 2 and iPhone No. 3. But, it can likely give NOK a lift and provide AAPL with a ding. If investors sense any bumps in the apparently smooth road Apple and its bulls believe the company faces with Chinese consumers, expect serious downward pressure on the stock, even if Asia-Pacific sales continue to grow by over 100%. The bar is set quite high.

It's this type of news that AAPL bulls, as well as the media that caters to their obsession, choose to ignore. And it's exactly this type of blow-off that could come back to haunt investors when they're least expecting it.

At the time of publication, Rocco Pendola was long MSFT and NOK.

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