[This post has been updated to include comment from Microsoft]
Nokia, whose phone business is soon to become part of Microsoft, introduced its first Android-based smartphone today at Mobile World Congress in Barcelona.
The Nokia X line of phones — which include the Nokia X, Nokia X+ and Nokia XL — is based on Google’s Android operating system, meaning the phones will run Android apps and that it should be relatively easy for developers to port their Android apps to the Nokia Store.
But the phones will also take users to Microsoft’s cloud — not Google’s — and will include Microsoft services including Skype, OneDrive and Outlook.com, as well as Nokia services such as Here maps and MixRadio.
The move can be seen as targeting two key weaknesses in Nokia’s and Microsoft’s 3-year-old Windows Phone partnership: comparative lack of apps and the ability to sell cheaper smartphones in emerging markets
Nokia had made a huge bet in 2011 to use Windows Phone as its primary smartphone operating system.
But while Nokia’s line of Lumia Windows Phones played a key role in boosting Microsoft’s (still tiny) smartphone market share, the partnership was not as beneficial to Nokia. In its most recent quarterly earnings report, the company saw sales in its handset division slide 29 percent from a year ago.
So Nokia is focusing on creating smartphones that cost less than 100 Euros (about $137) and that will appeal in growth markets — “a massive opportunity for us,” said Stephen Elop, executive vice president of Nokia’s Devices and Services group, who spoke at Nokia’s press conference at Mobile World Congress. (The webcast of the press conference is here.)
Elop, a former Microsoft executive who left to become Nokia CEO, will be returning to run Microsoft’s hardware division once Microsoft’s deal to acquire Nokia’s handset business closes.
All of the Nokia X phones will be “available widely around the world starting in growth markets,” Elop said.
The Nokia X, available immediately, will sell for 89 Euros; the X+, available in the second quarter, will sell for 99 Euros; and the XL, also available in the second quarter, will sell for 109 Euros.
Elop said the Lumia line of Windows Phone will continue to be the flagship line of smartphones, while the Nokia X line will be priced below the Lumias and be targeted toward growth markets. Nokia’s Asha line, and the new Nokia 220, is geared toward even lower price points.
Even as Elop introduced a Nokia phone based on a platform created by Microsoft’s archrival Google, he also tried to have it both ways.
The Nokia X line provides a gate to Microsoft, he said.
“We are deliberately using Android Open Source Project without Google cloud,” Elop said. “This assures a high degree of Android app compability while introducing the next billion people to Microsoft.
Shortly after the conclusion of Nokia’s press conference, Microsoft posted a statement from spokesman Frank Shaw that said, in part:
First, our transaction with Nokia has not yet closed. Today, we operate as two independent companies as required by antitrust law, and we will until the acquisition is complete. The anticipated close timeframe for the acquisition remains end of the first quarter of 2014.
Second, we’re pleased to see Microsoft services like Skype, OneDrive and Outlook.com being introduced on these devices. This provides the opportunity to bring millions of people, particularly in growth markets, into the Microsoft family. …
Finally, our primary smartphone strategy remains Windows Phone, and our core device platform for developers is the Windows platform.