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Originally published February 27, 2012 at 10:00 PM | Page modified February 28, 2012 at 7:35 AM

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Nokia offers cheaper Windows Phone to nip Android expansion

Nokia will sell a lower-priced Windows Phone in the second quarter to capture first-time users against similar devices powered by Google's...

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And why would I buy a Nokia phone running Windows Phone 7.5 when windows 8 is coming... MORE


Nokia will sell a lower-priced Windows Phone in the second quarter to capture first-time users against similar devices powered by Google's Android.

The Lumia 610 will be priced at 189 euros ($254) — 30 percent less than Nokia's current cheapest smartphone running Microsoft's Windows platform.

The device is aimed at young people to hook them on the company's new platform.

Nokia also announced a high-resolution camera phone as it returned to the Mobile World Congress in Barcelona, Europe's biggest wireless show, with its first product introduction in three years.

"The new Nokia Lumia 610 is the perfect introduction of Windows to a younger audience," said Jo Harlow, the company's smartphones chief. "We are now able to cover a range of needs and a range of price points."

Nokia Chief Executive Officer Stephen Elop won good reviews for the first two Lumia phones using the Microsoft platform, which sold "well over 1 million" units, he said last month. Nokia, the world's third-largest smartphone maker by shipments, has seen its stock fall about 10 percent since it unveiled those handsets Oct. 26 as consumers continued to bypass Windows Phones in favor of Android handsets costing as little as $100 and Apple's iPhone, which broadened its range with discounted older devices.

Microsoft has adapted Windows Phone software so that it requires half as much memory and runs the cheaper 7X27A chip from Qualcomm. That should help manufacturers cut their costs.

The price of the Lumia 610 "makes it very competitive with the low-end Android devices," said Carolina Milanesi, a research vice president at Gartner. The handset will be attractive to operators as it will require very little subsidy, she said. "You build momentum, you build volume and then you build interest in the ecosystem."

The Lumia will run on the updated version of Microsoft's software, Windows Phone 7.5, known as Mango, which will be based on cheaper hardware, according to the announcement.

"Nokia is starting to deliver on Elop's promise to bring down the price points and enlarge the Windows Phone ecosystem," said Martin Garner, a London-based analyst at CCS Insight. "It's still too early to proclaim success, the volumes are not there, but he is executing and doing it at the right sort of speed."

The manufacturer also said that its high-end Lumia 900 device, which will first go on sale in the United States with operator AT&T, won't be made available on any other fourth-generation network except in Canada. The handset, which will be sold in the second quarter and costs 480 euros ($640), will run on a form of third-generation technology called HSPA+.

Nokia, based in Espoo, Finland, also introduced three phones for its Asha line, sold primarily in emerging markets. The company got about 46 percent of its sales last year from these handsets and other low-end phones, which lag behind smartphones in processing speed and applications such as video calling and corporate email. The company's new camera-phone, the 808 Pure View, will have a 41 megapixel sensor, alongside optics jointly developed with Carl Zeiss.

"We are demonstrating the actions necessary to improve the fortunes of Nokia, very deliberately recognizing challenges, changing strategy and then executing very aggressively against that," Elop said. "That's the path you'll see us continue to execute day in and day out."

Intel moves deeper

into smartphones

Again demonstrating its resolve to expand beyond PCs, Intel announced Monday that three more new smartphones incorporating its microprocessors will be introduced in other countries this year.

The smartphone makers are Orange, Lava International and ZTE. Intel CEO Paul Otellini, who made the announcement at the Mobile World Congress, said more smartphones containing Intel's brainy chips will be unveiled in the next year.

"This is something we're doing sort of slowly and surely," he said, calling the three latest phones "exciting news."

Just last month, Intel disclosed at the Consumer Electronics Show that Lenovo and Motorola would soon sell smartphones made with the Santa Clara, Calif., company's microprocessors.

Although Intel dominates the market for chips used in personal computers, it is pushing hard to get its products into smartphones and tablets.

"These announcements indicate Intel's strong forward progress in smartphones," said Patrick Moorhead of Moor Insights & Strategy, which advises businesses on tech strategies.

Moorhead also noted that Intel should make further inroads in the smartphone market next year, when it plans to introduce a more advanced but less power-consuming chip.

But he added that chip makers using an alternative semiconductor design from British firm ARM — used in the vast majority of smartphones — also are improving their products.

Given that stiff competition, some analysts contend Intel could have a tough time making a significant dent in the phone market.

Yves Maitre, Orange senior vice president of mobile multimedia and devices, said its Intel-powered smartphone will be available in the U.K. and France later this summer.

Lava's smartphone will be available in India in the second quarter, said Vishal Sehgal, that company's co-founder and board director. And ZTE will offer Intel chips in smartphones and tablets in China the second half of this year.

Although none of the phones are being offered in the United States at this time, the deals are significant for Intel, Bill Calder said.

He noted that China is the world's biggest cellphone market and that sales of smartphones are rocketing in India. "People sometimes forget that the U.S. is not the center of the universe when it comes to phones."

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