Finnish startup Jolla, a company founded by former Nokia employees, will enter the smartphone market later this month with a rather expensive handset built upon Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)’s discarded MeeGo operating system. The phone will be named, quite simply, the “Jolla.”

Jolla

Jolla smartphone features

The phone will feature a 4.5 inch display, an 8 megapixel camera and a dual core Qualcomm processor. It is equipped with LTE connectivity, runs Android applications and will come with a pre-installed app store built by Russia’s Yandex, with 85,000 apps. It we also be built with Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)’s native HERE mapping software.

When I say expensive I mean the phone will carry a €399 ($536) price tag, before taxes or subsidies, when it is released on November 27.

The phone has been in the making for over two years when Jolla was founded during a massive downsizing at Nokia. Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)’s ditching of MeeGo in favor of building handsets to run Windows was not viewed favorably by Jolla’s founders and they went their own way.

There is no question that smartphone growth numbers are continuing to rise, the question is whether Jolla can successfully join this growth that is led by Google Inc (NASDAQ:GOOG)’s Android and Apple Inc. (NASDAQ:AAPL)’s iOS. This growth has come at the expense of BlackBerry and to a lesser degree Microsoft’s Windows phones.

Jolla’s first device debuts as global smartphone sales are rising, gradually supplanting basic mobile phones as the preferred mobile device.

Rise in smartphone sales

Smartphone sales rose 45.8% to 250.2 million units in the third quarter, according to a report issued Tuesday by Gartsaner Inc (NYSE:IT), and now represent far more than half of the entire handset market.

Jolla’s iOS built from the Nokia abandoned MeeGo will be named “Sailfish,” MeeGo before it was abandoned was also built in conjunction with Intel. It’s an open-sourced operating system like Android and very much unlike Apple Inc. (NASDAQ:AAPL)’s iOS.

The sole phone that Nokia produced with MeeGo was the N9. While it was critically well received it failed to sell in numbers sufficient for Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) to not pull the plug in 2011.

“We have truly made a phone to the best of our ability,” Jolla co-founder Marc Dillon said in an interview at a startup conference taking place this week in Helsinki, where the Jolla handset will officially launch. “I’ve got high hopes.”

The “Jolla” will be made available immediately on Finnish wireless carrier DNA. Few details have surfaced as to who else will also offer the phone but it’s expected that a number of non-Finnish carriers will be in the mix.