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A memo speech, sub­sequently posted on Nokia's internal blog, from Nokia's new chief exec­utive Stephen El­op warning the staff that it is "standing on a burning platform" has leaked from the compa­ny and indicates that the for­mer Microsoft exec­utive is planning rad­ical action to revive the compa­ny's fortunes.

(Fol­lowing fur­ther information af­ter the orig­inal publication of this post, it now tran­spires that the con­tents were giv­en as a speech which was then reprint­ed on the Nokia internal blog.)

He is expected on Friday to an­nounce sweeping changes, prob­a­bly including an alliance with an­oth­er smart­phone platform to give the compa­ny new strengths in the field it once dom­inated.

Reprint­ed by En­gad­get and re­produced in full be­low, the memo post likens the compa­ny's sit­uation to that of a man standing on an oil platform in the North Sea and fac­ing a raging fire on mul­ti­ple fronts – who has no choice but to jump into freezing wa­ter to survive.

The memo's con­tents match those alluded to pre­vi­ously by The Reg­is­ter and TechCrunch Eu­rope. It has been circulated with­in Nokia.

El­op is expected to make a signif­icant an­nounce­ment this Friday about what Nokia will do to stem the loss of mar­ket share, no­tably in the smart­phone mar­ket, where despite be­ing the biggest player it has been un­able to com­pete with incom­ers, no­tably Google's Android and Apple's iOS.

Many observers expect him to an­nounce an alliance - prob­a­bly with Microsoft's Windows Phone 7 in North America, where Nokia is weak­est - as well as a shakeup of the compa­ny's exec­utive and mid­dle man­age­ment.

The graph above, from the consultancy Asymco, shows the entire mar­ket and indicates how Android has grown rapidly to take a signif­icant share of it.

El­op points to a number of prob­lems for the compa­ny:
• its stock is moving onto "neg­ative cred­it watch" with rating agency Standard & Poor's, fol­lowing Moody's last week, indicating that it might downgrade its cred­itwor­thi­ness because they are concerned about its com­pet­itiveness
• the "bat­tle of devices has become a war of ecosystems" (such as Apple's App Store and Google's Mar­ketplace) and "ur com­petitors aren't taking our mar­ket share with devices; they are taking our mar­ket share with an entire ecosystem. This means we're go­ing to have to decide how we ei­ther build, catal­yse or join an ecosystem"
• "Google has become a gravi­tational force, drawing much of the indus­try's innovation to its core."
• "we have mul­ti­ple points of scorch­ing heat that are fu­elling a blazing fire around us" - from Apple, Android, and from Ch­inese com­petitors that can produce a device "much faster than, as one Nokia employee said only partially in jest, 'the time that it takes us to pol­ish a Power­Point presentation.' They are fast, they are cheap, and they are chal­leng­ing us."
• "we're not fight­ing with the right weapons. We are still too of­ten trying to approach each price range on a device-to-device basis."

Nokia has seen falling prof­its for the past three quar­ters, and warned in Jan­uary that prof­its for this quar­ter will be lower than an­a­lysts expected. It was also passed for worldwide share by Android in the fourth quar­ter, accord­ing to an­a­lysts.

El­op's memo speech/blogpost fol­lows.

Hello there,

There is a per­tinent story about a man who was working on an oil platform in the North Sea. He woke up one night from a loud explo­sion, which suddenly set his entire oil platform on fire. In mere mo­ments, he was surrounded by flames. Through the smoke and heat, he barely made his way out of the chaos to the platform's edge. When he looked down over the edge, all he could see were the dark, cold, forebod­ing Atlantic wa­ters.

As the fire approached him, the man had mere sec­onds to re­act. He could stand on the platform, and inevitably be consumed by the burning flames. Or, he could plunge 30 me­ters in to the freezing wa­ters. The man was standing upon a "burning platform," and he needed to make a choice.

He decided to jump. It was un­expected. In or­dinary circum­stances, the man would nev­er consid­er plung­ing into icy wa­ters. But these were not or­dinary times - his platform was on fire. The man survived the fall and the wa­ters. Af­ter he was res­cued, he noted that a "burning platform" caused a rad­ical change in his behaviour.

We too, are standing on a "burning platform," and we must decide how we are go­ing to change our behaviour.

Over the past few months, I've shared with you what I've heard from our sharehold­ers, op­erators, devel­op­ers, suppli­ers and from you. Today, I'm go­ing to share what I've learned and what I have come to be­lieve.

I have learned that we are standing on a burning platform.

And, we have more than one explo­sion - we have mul­ti­ple points of scorch­ing heat that are fu­elling a blazing fire around us.

For example, there is intense heat com­ing from our com­petitors, more rapidly than we ev­er expected. Apple disrupted the mar­ket by re­defining the smart­phone and attracting devel­op­ers to a closed, but very powerful ecosystem.

In 2008, Apple's mar­ket share in the $300+ price range was 25 per­cent; by 2010 it esca­lated to 61 per­cent. They are enjoying a tremendous growth trajectory with a 78 per­cent earnings growth year over year in Q4 2010. Apple demonstrated that if designed well, consumers would buy a high-priced phone with a great expe­ri­ence and devel­op­ers would build applications. They changed the game, and today, Apple owns the high-end range.

And then, there is Android. In about two years, Android cre­ated a platform that attracts application devel­op­ers, ser­vice providers and hardware manufac­turers. Android came in at the high-end, they are now winning the mid-range, and quickly they are go­ing downstream to phones under €100. Google has become a gravi­tational force, drawing much of the indus­try's innovation to its core.

Let's not for­get about the low-end price range. In 2008, Me­diaTek supplied complete ref­er­ence designs for phone chipsets, which enabled manufac­turers in the Shenzhen region of China to produce phones at an unbe­lievable pace. By some accounts, this ecosystem now produces more than one third of the phones sold glob­ally - taking share from us in emerg­ing mar­kets.

While com­petitors poured flames on our mar­ket share, what hap­pened at Nokia? We fell behind, we mis­sed big trends, and we lost time. At that time, we thought we were making the right deci­sions; but, with the ben­efit of hindsight, we now find our­selves years behind.

The first iPhone shipped in 2007, and we still don't have a prod­uct that is close to their expe­ri­ence. Android came on the scene just over 2 years ago, and this week they took our leader­ship po­sition in smart­phone vol­umes. Unbe­lievable.

We have some brilliant sources of innovation in­side Nokia, but we are not bring­ing it to mar­ket fast enough. We thought MeeGo would be a platform for winning high-end smart­phones. Howev­er, at this rate, by the end of 2011, we might have only one MeeGo prod­uct in the mar­ket.

At the midrange, we have Symbian. It has proven to be non-com­pet­itive in leading mar­kets like North America. Additionally, Symbian is proving to be an increas­ingly diffi­cult envi­ron­ment in which to devel­op to meet the con­tinuously expanding consumer require­ments, leading to slowness in prod­uct devel­op­ment and also cre­ating a disadvantage when we seek to take advantage of new hardware platforms. As a result, if we con­tinue like before, we will get fur­ther and fur­ther behind, while our com­petitors advance fur­ther and fur­ther ahead.

At the lower-end price range, Ch­inese OEMs are crank­ing out a device much faster than, as one Nokia employee said only partially in jest, "the time that it takes us to pol­ish a Power­Point presentation." They are fast, they are cheap, and they are chal­leng­ing us.

And the truly perplexing as­pect is that we're not even fight­ing with the right weapons. We are still too of­ten trying to approach each price range on a device-to-device basis.

The bat­tle of devices has now become a war of ecosystems, where ecosystems include not only the hardware and soft­ware of the device, but devel­op­ers, applications, ecommerce, advertis­ing, search, social applications, location-based ser­vices, uni­fied communications and many oth­er things. Our com­petitors aren't taking our mar­ket share with devices; they are taking our mar­ket share with an entire ecosystem. This means we're go­ing to have to decide how we ei­ther build, catal­yse or join an ecosystem.

This is one of the deci­sions we need to make. In the meantime, we've lost mar­ket share, we've lost mind share and we've lost time.

On Tuesday, Standard & Poor's informed that they will put our A long term and A-1 short term ratings on neg­ative cred­it watch. This is a similar rating action to the one that Moody's took last week. Ba­sically it means that dur­ing the next few weeks they will make an anal­ysis of Nokia, and decide on a pos­sible cred­it rating downgrade. Why are these cred­it agencies con­templating these changes? Because they are concerned about our com­pet­itiveness.

Consumer pref­er­ence for Nokia dec­lined worldwide. In the UK, our brand pref­er­ence has slipped to 20 per­cent, which is 8 per­cent lower than last year. That means only 1 out of 5 people in the UK pre­fer Nokia to oth­er brands. It's also down in the oth­er mar­kets, which are tra­ditionally our strongholds: Russia, Germany, Indonesia, UAE, and on and on and on.

How did we get to this point? Why did we fall behind when the world around us evolved?

This is what I have been trying to under­stand. I be­lieve at least some of it has been due to our atti­tude in­side Nokia. We poured gaso­line on our own burning platform. I be­lieve we have lacked account­ability and leader­ship to align and di­rect the compa­ny through these disruptive times. We had a se­ries of misses. We haven't been de­liv­ering innovation fast enough. We're not collab­orating internally.

Nokia, our platform is burning.

We are working on a path forward -- a path to rebuild our mar­ket leader­ship. When we share the new strategy on February 11, it will be a huge effort to transform our compa­ny. But, I be­lieve that togeth­er, we can face the chal­lenges ahead of us. Togeth­er, we can choose to de­fine our fu­ture.

The burning platform, upon which the man found him­self, caused the man to shift his behaviour, and take a bold and brave step into an un­certain fu­ture. He was able to tell his story. Now, we have a great opportunity to do the same.

Stephen.

Update: Asked for a com­ment, Nokia said that it did not com­ment on internal mat­ters and dec­lined to com­ment on the con­tent of the memo or its provenance. The Guardian be­lieves that the memo is gen­uine.

And: Vic Gundotra, Google's VP of en­g­i­neering (and a for­mer Microsoft staffer), tweets re "#feb11" - when El­op will make his an­nounce­ment - that "Two turkeys do not make an Eagle". (Ditto'd by @Carniphage in com­ments be­low). That implies that there isn't a tieup fig­ured out with Android.

Updated to clar­ify that the "memo" was in fact a speech which was then reprint­ed on an internal Nokia blog.