True.

They are definitely not a hardware orientated company. Apart from the X-Box series, what have they done that's been a roaring success on the scale of the majority of Nokia devices?

I've gone through 6 sidewinder joysticks before I settled on a Saitek, which has already outlasted all of them.
Zune? Megafail on looks and attractiveness (just like the Sidewinders).
They are now relying on other manufacturers to build the devices while M$ just provide the O/S. And didn't they attempt to get into the PC hardware market, but failed miserably?
That, IMHO, is where M$ and Nokia share an interest. Nokia want to build handsets for M$ and M$ think it's a good idea. Soon, we could be seeing Nokia devices with Microsoft branding, either made by Nokia or license built by M$.