Nokia Corporation (ADR) (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) has announced that it will release its new smartphone, the Nokia Lumia 928 exclusively with Verizon Communications Inc. (NYSE:VZ) in the United States. The move shows a changing strategy on the part of Nokia as well as determined demand for the model from carriers.
An exclusive deal with a single carrier is likely the way in which Nokia hopes to keep the price of its new smart phone low. According to a Reuters piece on the release, the Nokia Lumia 928 will be offered to US customers for $99 after a $50 mail in rebate on a two year contract.
The Lumia 928 is hoped to help Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) compete with a new generation of smart phones with larger screens, notable on the Google Inc (NASDAQ:GOOG) Android platform. The most successful offerings so far have been from Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930) with its 4.8 inch Galaxy SII and its latest offering, a 5 inch Galaxy s4.
According to the Verizon Communication Inc. (NYSE:V) website, those models are currently selling for $99 and $199 respectively on a two year contract. The Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) Lumia 928 should be able to compete attractively on price, but its feature might not live up to the expectations of the market.
The Lumia 928 will come with a 4.5 inch 1080p screen, and an 8.7 megapixel camera. Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930), with the release of the Galaxy S4 appears to be betting on consumers still wishing for bigger and bigger screens on their smartphones. While the Nokia offering is comparable, it’s doesn’t have quite the magnitude of the new Samsung offering or the company’s previous smart phone.
There are good signs from the exclusivity deal with Verizon Communications Inc. (NYSE:VZ). It is probably that deal which allows Nokia to offer its latest phone at the low price of $99, and the deal shows that calculation on the part of Verizon staff leads them to believe the phone could be quite popular. Nokia phones pledged to other networks will be disappointed by the move, however.
Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) is still in the midst of a turnaround that appears to be the hallmark of many tech companies this decade. The mobile revolution took some, including Nokia, by surprise, and has left them trying to catch up. For investors in the Finnish firm, the Lumia 928 represents another step on the long path toward recovery.
On today’s market, Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) stock was up by more than 2.5 percent to $3.64 at time of writing.