FIM bank analyst Michael Schroeder told AFP that Google, the maker of the Android smartphone platform, indirectly increased Nokia's share value with its 8.7 billion-euro (12.5 billion dollar) bid for Motorola Mobility.
"Since Google paid so much, in large part to get Motorola's patent portfolio ... this drew attention to the fact that Nokia probably has by far the industry's largest patent portfolio," he said.
Nokia's sliding share price has slumped since February when chief executive Stephen Elop announced it would abandon its Symbian smartphone platform in favour of a partnership with Microsoft.
At 1245 GMT, however, Nokia was up 4.7 percent at 4.28 euros on a Helsinki Stock Exchange down 2.3 percent.
"One explanation could be that many investors believe Nokia shares to be undervalued when compared to what Google is paying for Motorola," financial reporter Petri Sajari wrote Tuesday in the leading daily Helsingin Sanomat.
Nokia believes Google's purchase shows Elop was right when he set out to make Nokia the third contender against Google and iPhone maker Apple.
"This further reinforces our belief that the opportunity to differentiate and grow the Nokia smartphone business will be greatest with Windows Phone," company spokesman James Etheridge told AFP.
Analyst Schroeder said that the Google deal could drive Android-phone makers such as HTC and Samsung to use the Microsoft platform, and in doing so validate Nokia's decision to hitch its wagon to the US giant.
"Android has been doing well recently because it was independent from handset makers ... but now that Google is acquiring Motorola's handset business, even if the motives are probably for the patent portfolio, Google suddenly appears" different, Schroeder said.
This could make Google appear like a competitor to the smaller mobile makers who could now be looking for an alternative.
Since Apple's iPhone runs on a proprietary platform, the only other viable alternative is Microsoft.
"The importance of a third ecosystem is now even more evident," said Nokia's Etheridge.
Speculation of Nokia being ripe for a buyout is rife the Motorola deal removes Google as a potential buyer, Schroeder said.
"And it's quite likely that there would be large (penalties) if someone bought Nokia and tried to disengage it from the Microsoft partnership," said Schroeder, adding that it was equally likely that Microsoft was bound by the deal not to buy Nokia outright.
Copyright AFP (Agence France-Presse), 2011