NEW YORK ( TheStreet) -- Many tech enthusiasts expected Best Buy ( BBY) to die at the hands of online competition from Amazon ( AMZN) and the dominance of iPhone and iPad maker Apple ( AAPL). But Best Buy stands poised to see its "Renew Blue" turnaround strategy gain traction after Microsoft ( MSFT) doubled down on its push into the smartphone market with deal to acquire Nokia's ( NOK) handset business for $7.1 billion. Best Buy is uniquely positioned to benefit from what could be a growing rivalry between Microsoft and Google ( GOOG), as those firms seek to cut into the mobile industry profits that Apple has achieved by integrating its operating system with its mobile hardware. Google and Microsoft will now own large handset manufacturers that put them in direct running with Apple, and both companies are likely to rely on Best Buy as a crucial selling channel. In the past year, Google and Microsoft have both opened their own stores within Best Buy stores nationally, in a move that is helping the big box electronics retailer improve its appeal to customers and its profit margins. While Best Buy's store-in-store concept with Google and Microsoft is just starting to be reflected in quarterly earnings reports, Microsoft's further commitment to hardware indicates Best Buy's strategy could take hold. Put simply, Microsoft and Google are giving no signs of slowing their spending in the smartphone market. In the medium-term, Best Buy seems to be the biggest beneficiary. At this time last year, Best Buy was fighting a seemingly hostile takeover bid by its founder Richard Schulze that put its credit ratings in junk bond territory. However, Microsoft's dedication to the consumer hardware and software business may change the narrative surrounding the company, heading into an all-important holiday season and hardware upgrade cycle. The company has returned to profitability and its operations are beginning to generate cash again. The "Renew Blue" strategy under new CEO Hubert Joly and three quarters of better-than-forecast earnings that culminated in a return to profitability in the second quarter beg the question of whether the business has stabilized.