Nokia once ruled the phone world, but couldn’t keep up when modern touch devices took over the smartphone game – although it produced some fine Windows Phone devices. And then it sold its hardware division to Microsoft, seemingly ending that saga.

But now, Re/Code reports that the company is covertly planning to reenter the smartphone game as soon as it’s able to – late next year. What’s preventing the Finnish company from jumping back into the fray sooner?

It’s that very same Microsoft deal. Microsoft may have stopped using the Nokia branding as of last year, but the terms of the agreement say that Nokia can’t make and sell its own phones this year, nor can it license its name for another company to do the same until the third quarter of 2016 at the earliest.

And it’s the latter option that Nokia appears likely to pursue. Having shed its hardware business and not eager to carry that kind of expense and scale again, Nokia will reportedly design products and find a partner to manufacture and market them. It’s exactly what the company did with its current N1 tablet, which looks like an iPad Mini but runs Android.

Just last week, Nokia announced that it is working on an acquisition of Alcatel-Lucent to give it a leg up in the network technology market, and that it is looking into possible selling its Here Maps division. But the phone and tablet projects come out of Nokia Technologies, the arm of the company that manages its 10,000+ patents and quietly develops new projects with regularity.

If the N1 is any indication, Nokia has some fight left it in and can make devices that impress amidst the current competition. The company’s phone hardware decline was tough to see, particularly for those of us who relied on its earlier efforts years back, but perhaps taking a breather and changing perspective will end up benefitting Nokia in the long run. We can’t wait to see, either way.

Source: Re/Code