In a recent post on the impact of the 3G iPhone on Research In Motion (RIMM), we saw how RIM and Nokia (NOK) stand to gain from the iPhone momentum in the smartphone industry. In April, Tom Libretto, vice president of Forum Nokia, talked about a new touch-screen mobile phone that is supposed to take on the iPhone. Called the Tube, it will support Java and is most likely to have a keyboard, GPS, and run on the Symbian S60 platform. In October 2007, Nokia developed a touch screen version of the OS that will support finger and stylus input as well as tactile feedback.

And just this week, Nokia released two new E Series phones on the S60 platform, E71 and E66, that are targeted at the enterprise users. Both the phones have keyboards (an area where I find the iPhone to be lacking) along with 3G, push-email, Wi-Fi, GPS and a 3.2 MP camera. E71 has a full keyboard while E66 is a slider phone, with a more traditional keyboard. Though these phones can be expected to be a big hit in Europe, Nokia loses out in the U.S. where it doesn’t have a carrier partner that can offer subsidies. (Why doesn’t it, anyway?)

However, outside the U.S., Nokia and Symbian are doing great. In the global smartphone market, Nokia is the leader with a 45.2% market share. Shipments grew 25.3% to 14.5 million units in Q1. Nokia owns about 48% of Symbian, with the rest held by Ericsson (ERIC), Sony Ericsson (SNE), Panasonic, Siemens (SI) and Samsung. Last year, Symbian had 67% of the smartphone market. Symbian is a tough force to reckon in the emerging markets in Asia, Latin America and Europe, the Middle East and Africa. It is also highly popular among third-party developers, who’ve released more than 9,200 Symbian applications. This is where Apple (AAPL) is trying to score with its iPhone SDK.

The Tube is expected to come out by the end of the year, and the iPhone is also expected to be rolling out in 70 countries at the end of the year. With its robust manufacturing model, the Nokia Tube can be expected to undercut the iPhone’s price. But in this face-off, can the iPhone overcome Nokia’s strong hold?

Nokia is currently trading around $25 with a market cap of about $97 billion, compared to Apple’s stock price of $177 and market cap of $156 billion. The convergence device market is one of my strongest trend investing bets.  I own all three stocks: Apple, Nokia and RIM, and see no reason to get out of any of them for the time being.