Each week, the Windows Store will feature three new apps for the Red Stripe Deals each week. Each week, there will “typically” be one Xbox game, one indie game, and one top-rated app, all of which will be marked down by at least 50% of the original price. Microsoft says that Red Stripe name comes from the red stripe that you’ll see on the apps that are on sale for that week.

What does Microsoft have on sale this week? The inaugural Red Stripe collection features Runtastic Pro, Assassin’s Creed: Altairs Chronicles HD, and King Oddball — all of which are just $0.99 each. These three apps/games will only be discounted for a week, so grab them now before next Thursday rolls around.

Windows Phone 8 has seen a lot of neat apps and games come its way as of late. Just recently, Temple Run was released on Windows Phone 8, as was Pandora, which comes with no ads until 2014, which is usually a feature only granted to paying subscribers of the music-streaming service. Now, Windows Phone 8 users get the deal exclusively.

While the sheer bulk still belongs to Android and iOS for app market size, it would appear that Windows Phone 8 has had a real positive effect on the confidence of the app developer in general. Many of the most well-known apps are now on all three platforms and a massive amount of top brands and services have been coerced by the launch of Windows 8 to create their own Windows Phone 8 presence as well.

Additional affirmations from Brix include the fact that Windows Phone customers now download, buy, and use more apps than at any time in Windows Phone’s history – or at least as long as Windows Phone 7 has been around (right around 2 years). Microsoft assures us that Windows Phone users now download 54 apps each on average “to personalize their phone experience around the people and information they care about most.” This popularity rings true with a series of news blasts that have appeared over the past few weeks that we’re sure not just Microsoft is happy to have seen:

Let us know how you’re experiencing Windows Phone 8 at this very moment. Do you use Windows Phone 7 or 8 yourself, or does anyone around you use a Windows Phone 7 or 8 device?

Unfortunately, not all existing Windows Phone 7.5 handsets will receive the update, but most existing users can expect an update to version 7.8 that will bridge the gap between their device and new devices running Microsoft’s latest mobile operating system. WP7 users are upset as it is, since they won’t be able to get WP8 on their current devices, so it’s crucial that Microsoft roll out the update in a timely manner.

Microsoft’s corporate vice president of Windows Phone, Terry Myerson, said that “new models running Windows Phone 7.8 are beginning to launch in many countries around the world,” which means that there will technically be Windows Phone 7.8 devices out in the wild, but the update for existing customers won’t be ready to roll out until early next year.

Other features of Windows Phone 7.8 include 20 new theme and accent colors, new lock screen features that can display the Bing Picture of the Day, and an “A1B2C3″ PIN/password challenge to prevent accidental device wipes on phones connected to Exchange accounts. While I’m sure most WP7 users would love to have WP8, WP7.8 seems to be a good compromise.

Windows Phone 7 and 8 users get the most feature changes, gaining a segmented map that offers a more detailed image of a route. There’s a plan-ahead feature, allowing users to view routes and select route plans by entering a future travel date and destination. Users can toggle distances between miles and kilometers, depending on preference, and can view departure times by seeing how much time is left or the exact time something is scheduled to leave. In addition, users can easily pull up route history, or delete history if you need to keep your journeys private.

Symbian users get a different kind of update, with an overall improved user experience and search function. In addition, there’s the new ability to get over-the-air coverage updates, removing the need to download a fresh app whenever an area extension is pushed out. The new app is in beta, and is available via Nokia Beta Labs.

Nokia Transport presently covers over 550 cities and 53 countries, and, according to the company, “is constantly growing.” You can find out if the mapping/navigation platform covers an area you’re interested in by visiting Nokia’s comprehensive coverage page on its website. The company is actively soliciting feedback on the updates, so if you have an opinion to voice, head over to the company’s @heremaps Twitter feed.

[via Nokia]

“Windows Phone’s share weakened year-on-year as the Windows Phone 8 launch dampened demand of Windows Phone 7 devices” Gartner suggested, though the new version of the platform may not be the instant good news OEMs like Nokia are hoping for. In fact, Nokia’s new Lumia devices will only “help to halt the decline in share” in Q4, with no “significant improvement” predicted until 2013.

Nokia isn’t the only firm having a tough quarter. RIM and HTC dropped to third and fourth places in the manufacturers chart respectively, and there are fears that even retaining those positions may be untenable. “The challenges might prevent them from holding on to their current rankings in coming quarters” Gartner’s Anshul Gupta said of the firms.

On the up, meanwhile, are Samsung and Apple. Samsung has the Q3 2012 top spot, with 22.9-percent of the market, while Apple has 5.5-percent of the market; Android has 72.4-percent market share, according to Gartner’s figures, a sizable jump year-on-year from 52.5-percent. In contrast, iOS market share declined slightly, from 15-percent a year ago to 13.9-percent, though it’s RIM and Symbian which saw the biggest falls.

Apple’s Q4 2012 is likely to be a good one, Gartner concludes, with the new iPhone 5 and fledgling sales in various new locations meaning the holiday quarter should end positively. Many iPhone 4S/4 owners held off upgrading until the new handset was released, the analysts point out, something which Apple itself has suggested.

The holiday season overall, however, may not be the salvation many firms hope for. Gartner predicts smartphone sales will not get the traditional kick, as shoppers look to other devices such as tablets for potential gifts.

Year on year, the numbers are even more dismal, with overall volumes stopping 22-percent. In the same period, net sales dropped 34-percent.

Nokia blames “lower operator and distributor demand for Lumia as well as our efforts to prepare the distribution channel for the upcoming sales start of new devices” for the drop in North America, while sales in China were down because of “competitive pressures” trampling on Symbian interest.

There’s frustration ahead for existing Lumia owners, however, with the news earlier this year that their hardware would not be compatible with the next version of Windows Phone. Instead, they’ll get Windows Phone 7.8, a UI refresh, but few of the underlying software improvements. How that might impact the warm, fuzzy feelings toward the Finnish firm by early-adopters remains to be seen.

All hopes are now on Nokia’s new Windows Phone 8 line-up, which currently consists of the Lumia 920 flagship and the Lumia 820 mainstream handset. Nokia is also focusing on wireless charging as a differentiator, though the company has been criticized for the relatively high prices of its charging accessories.

Microsoft has no plans to release Xbox Music apps for Windows 7 or Windows Phone 7/7.5/7.8, the company admitted to The Verge, leaving those desktop and mobile platforms with the existing Zune Pass program. That means the same catalog of tracks will be on offer – Microsoft says that amounts to over 30m globally, though not all tracks are available in all countries – but the cloud functionality won’t be present.

For instance, Xbox Music users will be able to create playlists of tracks and have those automatically synchronize across multiple devices logged into the same account, but Zune Pass users won’t get access to the functionality. Similarly, the upcoming “cloud match” service which will put existing music users own into the cloud for them to enjoy on any device will also not be extended to Zune Pass users.

Windows 7 users, meanwhile, will also miss out on the free streaming access that Windows 8/RT users will get. Xbox Music on Windows Phone 8 and Xbox 360 will demand a monthly subscription of $9.99 (on top of Xbox LIVE membership on the console), but Windows 8 users will have a free, ad-supported option instead.

However, that unlimited, ad-supported playback will be short-lived. According to Microsoft’s small-print, after six months of use the option will be limited to just ten hours of playback each month. That’s in contrast to Spotify, the ad-supported plan of which has no such limits. [Update: Spotify's limits vary depending where you live. In the US, you get unlimited ad-supported playback, whereas in the UK there are restrictions after six months]

It’s not the only indignity early-adopters of Windows Phone 7 have had to stomach. Microsoft cut backward compatibility with Windows Phone 8, promising those who bought earlier devices only a visual update to WP7.8 rather than the full, new OS.

The two headline numbers are sales and losses. Nokia sold four million Lumia handsets in the three month period, the company confirmed, roughly double its sales for the previous quarter, and beating pre-news estimates. However, operating losses reached a whopping $1bn, despite net sales rising slightly.

Phone volumes altogether rose in fact, though only 600,000 handsets were sold in North America. €250m of Nokia’s income was straight out of Microsoft’s wallet, comfortably exceeding what Nokia is obligated to pay for Windows Phone licensing, though even that isn’t enough to promise a good Q3 2012.

So what’s in the pipeline? Elop was coy on specifics but enthusiastic in general about future Lumia handsets, saying the company was readying an array of new materials and technologies for its next-gen Lumias (and the range after that). The run-up to Windows Phone 8 has also given the company the time to prepare more differentiation between its devices and those of other Windows Phone OEMs, and Elop says we’ll see evidence of that in advanced location-based services that make Nokia the “Where” company.

What we might not see is a cross-carrier splurge of the sort common in Europe. Elop revealed that, contrary to popular belief that broader distribution means more sales, Nokia had in fact seen better returns focusing on a single carrier in the manner of the Lumia 900 on AT&T, instead of spreading its love across multiple carriers.

Nokia is counting on the double-whammy of Windows Phone 8 and Windows 8 to reinvigorate interest in the platform and give Lumia a boost (Elop didn’t mention tablets, though did hint that Nokia might be looking at the possibility). However there are a few more rough months to come before the “transition” period is over.

Microsoft announced Windows Phone 8 last month, outlining the new smartphone OS’ shared kernel with Windows 8, but also confirming that any current Window Phone 7.x device would not get an upgrade. Instead, they’ll have to make do with Windows Phone 7.8, a halfway-house of UI tweaks that makes the current platform look like WP8 but lacks the underlying technologies.

However, Nokia believes that will not necessarily be a drawback. “What we’re very focused on communicating right now is that existing owners – and people who buy devices tomorrow – will be very clear what they’re getting from Windows Phone 8″ Elop said in response to questions as to users might be confused. In fact, the company has seen activation of Lumia handsets as being ”stable to up” in the period after Windows Phone 8 was announced.

“We have to carefully communicate, the updates and upgrades we are providing for the existing devices are anticipated not just up to Windows Phone 8 but after Windows Phone 8 ships” Elop conceded. “We will continue to sell existing Lumia devices beyond Windows Phone 8, in some cases for quite a while. We’re working very closely with developers … to ensure application development flow continues across the platforms.”

Nokia’s estimates for Q3 are roughly in line with those of Q2, though plus-or-minus 4-percent. That relatively broad range, Elop explained, is because of the degree of uncertainty around how Windows Phone 7 will be impacted by the new incoming version.

“Our agreement with Microsoft includes platform support payments from Microsoft to us as well as software royalty payments from us to Microsoft. In the second quarter 2012, we received a quarterly platform support payment of USD 250 million (approximately EUR 196 million). Under the terms of the agreement governing the platform support payments, the amount of each quarterly platform support payment is USD 250 million. We have a competitive software royalty structure, which includes annual minimum software royalty commitments. Minimum software royalty commitments are paid quarterly. Over the life of the agreement, both the platform support payments and the minimum software royalty commitments are expected to measure in the billions of US dollars. The total amount of the platform support payments is expected to slightly exceed the total amount of the minimum software royalty commitments. In accordance with the contract terms, the platform support payments and annual minimum software royalty commitment payments continue for a corresponding period of time” Nokia

Nokia and Microsoft have always been coy on exactly how much is charged of each OEM to use Windows Phone devices, but the takeaway here is that right now it’s not costing Nokia anything to put the platform on its handsets. In fact, Microsoft is in effect subsidizing Nokia’s losses.

As for the immediate future, Windows Phone 8 won’t arrive soon enough to turn around Q3 2012. Nokia is predicting a similar batch of numbers to what it announced today, with Q3 expected to be roughly on a par with Q2′s performance give or take 4-percent.

What could make a difference is if Lumia Windows Phone sales continue to rise at the same pace. Nokia announced shipments of 2m handsets in Q1 2012, and 4m in Q2, so the platform is certainly going in the right direction; unfortunately for the company’s bottom line, that success was offset significantly by losses in all divisions – including NAVTEQ and other services – and the continued dwindling of interest in Symbian phones.

However, the fact that current Lumia handsets won’t get an upgrade to Windows Phone 8 may well scupper the rise in interest, if the mass market figures out that it’s buying into what amounts to a dead-end range. AT&T recently halved the price of the Lumia 900 to $49.99 on contract, though Nokia insists that doing so is standard market practice given where the device is in its lifespan.

Symbian continues to slide, meanwhile, blamed for much of Nokia’s issues. Symbian’s difficulties in penetrating the North American market to begin with meant it was the only region not particularly impacted by the OS’ decline. “All regions showed a significant year-on-year decline in the second quarter 2012 except for North America,” Nokia reported, “where the sharp decline in sales of Symbian devices was more than offset by sales of our Lumia devices.”

Meanwhile, year-on-year average smartphone selling price increased, thanks to Windows Phones being generally more expensive than their Symbian counterparts. ASP was €186 ($229) in Q2.

However, all is not good in Nokia’s gross margin: a “significant” year-on-year and sequential decline was down to “approximately €220 million of allowances related to excess component inventory, future purchase commitments and an inventory revaluation related to our Lumia, Symbian and MeeGo devices” the company says.

AT&T recently halved the price of the Lumia 900 in the US, now offering the smartphone for $49.99 on a new, two-year agreement. However, the handset will not be upgraded to Windows Phone 8, instead only getting the Windows Phone 7.8 halfway-house update.

2012 has not been a good year for Nokia. The Finnish company saw its long-standing position at the top of the mobile ladder stolen out from under it by Samsung, with adoption of Lumia Windows Phones sluggish at the top end, and Nokia’s entry-level range under heavy attack from cheap Android devices in developing markets.

Windows Phone 8 represents another opportunity for Nokia to recover, with the next-gen version of the platform already shaping up to be considerably improved as well as tightening integration between the smartphone OS and Windows 8 on the desktop thanks to a shared kernel. However, that advance comes at a cost: existing Windows Phone 7 devices, including the entirety of Nokia’s existing line-up, won’t get an upgrade to Windows Phone 8, instead getting a partial tweak with the new UI but none of the more impressive underlying features.

Meanwhile, Nokia has also suffered by not having its own piece in the tablet ecosystem, the company holding off until – as CEO Stephen Elop has previously said – it can bring something new to the marketplace. That could involve Windows 8 or its ARM-centric sibling Windows RT, though like Windows Phone 8 they’re not expected until Q4 this year.

Stephen Elop statement on Q2:

“Nokia is taking action to manage through this transition period. While Q2 was a difficult quarter, Nokia employees are demonstrating their determination to strengthen our competitiveness, improve our operating model and carefully manage our financial resources.

We shipped four million Lumia Smartphones in Q2, and we plan to provide updates to current Lumia products over time, well beyond the launch of Windows Phone 8. We believe the Windows Phone 8 launch will be an important catalyst for Lumia. During the quarter, we demonstrated stability in our feature phone business, and enhanced our competitiveness with the introduction of our first full touch Asha devices. In Location & Commerce, our business with auto-industry customers continued to grow, and we made good progress establishing our location-based platform with businesses like Yahoo!, Flickr, and Bing. We continued to strengthen our patent portfolio and filed more patents in the first half of 2012 than any previous six month period since 2007. And, we are encouraged that Nokia Siemens Networks returned to underlying operating profitability through strong execution of its focused strategy.

We are executing with urgency on our restructuring program. We are disposing of non-core assets like Vertu. We are taking the necessary steps to restructure the operations of the company, which included the announcement of a new program on June 14. Faster than anticipated, we have already negotiated the closure of the Ulm, Germany R&D site, and the negotiations about the planned closure of our factory in Salo, Finland are proceeding in a collaborative spirit.

We held our net cash resources at a steady level after adjusting for the annual dividend payment to our shareholders. While Q3 will remain difficult, it is a critical priority to return our Devices & Services business to positive operating cash flow as quickly as possible”

Ninety users will be accepted, according to HTC, still a minority in comparison to Android users in the program, which are believed to number somewhere between 500 and 1,000. HTC uses its audience to test new functionality and survey potential new features.

“We’re offering an opportunity for you to collaborate directly with the team at HTC to help with innovation, feedback, advocacy, marketing and quality” the company says of the Elevate program. “We consider our community members an important part of the creative team, so your opinions and feedback will help shape the future of HTC products and services.”

The new Windows Phone admissions are likely to be timed with HTC’s Windows Phone 8 development, though the company was conspicuous by its absence from the initial line-up of OEMs expected to release devices running the new OS. Membership is by application, and not everybody who applies will be accepted into the program.

That decision has already polarized opinion among Lumia owners and others, with some pointing out that there are neither obligations nor promises by Microsoft and Nokia to release updates to software on a handset. Others, however, argue that for a device which only went on sale not even three months ago, to have it left behind from the cutting-edge of OS releases so rapidly is more than disappointing.

There’s no clear rule either way as to how much users should expect in the way of updates; it’s generally best to buy a device which serves your purposes today rather than because it could deliver on them eventually. We’ve already questioned whether Google should have promised Android users updates in the first place, given the furore around fragmentation.

Nonetheless, Nokia – along with other Windows Phone OEMs, though the Finnish company is particularly dependent on the platform – now finds itself facing a potential lull in sales as many consumers are likely to hold off buying a current-gen device in favor of waiting for a Windows Phone 8 handset (or, worse for the company, jumping ship altogether and opting for Android or iPhone).

There’s the possibility that the entry-level market Nokia is currently chasing with the Lumia 610 and other, cheaper Windows Phones still to come will not be as concerned with software upgrades as their power-user counterparts. Still, it’s another problem that Nokia could do without as it struggles to regain market share.

Instead, Windows Phone 8 will require new hardware. If you bought a Lumia 900 recently, for instance, the flagship Nokia Windows Phone on the market today, in just a few months time it will be outclassed by new devices and, most gallingly, be instantly left behind in terms of the new functionality.

Windows Phone 7.8 does have some advantages, at least in the short-term. Microsoft’s decision not to offer Windows Phone 8 for existing devices is presumably based on hardware limitations for the current specification guidelines: the new Windows core is likely too demanding. If the company had pushed ahead anyway then it might have led to a seriously sub-par user experience overall, something that presumably won’t be the case with v7.8.

It’s what comes afterwards that’s questionable. Microsoft, unsurprisingly, hasn’t talked about what 7.x releases are expected after v7.8, but it certainly seems likely that the company will push ahead to only working on 8.x iterations. Less than a year into your Lumia 900 agreement, you’re most probably left with a device that’s unlikely to see another point-upgrade in its lifetime.

Windows Phone 8 looks like a solid and interesting platform, particularly in terms of the tightening ecosystem between it, Windows 8 and Xbox LIVE. That’s great for new users, certainly, but those who have already taken the leap and jumped on board with Windows Phone 7/7.5 are in an altogether more frustrating position. Leaving anyone behind when you’re playing catch-up in the smartphone segment is not something to be proud of.

However, Microsoft hasn’t detailed just exactly what will be included in Windows Phone 7.8. Instead, the company says that it will include “core customer experiences” from the full OS, with UI improvements among other things.

That seems to imply that the more advanced features simply won’t be brought to the older phones, though to a casual glance they might look the same. Windows Phone 8′s new shared core with Windows 8 is likely to be the root of the problem, too demanding for the 1.0 to 1.4GHz single-core processors of Windows Phone 7.5 devices.

No release date for Windows Phone 7.8 has been confirmed, though it’s likely to be released to existin users alongside the full WP8 launch this fall. More details on the new platform in the timeline links below.

So far we’ve got plenty of speculation and rumor – and a handful of supposedly leaked screenshots – to go by. Windows Phone 8 is expected to have Microsoft-owned VoIP service Skype fully baked in, with making a voice or video call over your data connection made just as straightforward as a regular cellular call.

There’s also a new, Nokia-powered version of the mapping app, which will bring traffic information, more flexible directions and more to Windows Phone. In terms of hardware, developers are expected to get an early glimpse of the nuts & bolts of coding for the new platform, which will introduce multi-core processor support, NFC short-range wireless, and a broader range of screen resolutions (in fact four are believed to be in the pipeline).

Microsoft – and key partners like Nokia - are betting big on Windows Phone 8, so the company needs to get today right and build momentum for its launch. We’ll have all the details from Microsoft’s Windows Phone Summit as soon as they’re announced, so keep an eye on the SlashGear homepage!

The most obvious strategy would be to follow Google’s lead with the Nexus program and pave the way for the next-gen OS with a Windows 8 and/or Windows RT model. Microsoft is a late arrival to the modern tablet marketplace – it may have had a Tablet PC Edition as far back as the days of Windows XP, but it came nowhere near the success achieved by the iPad in recent years – and it needs a strong push if it’s to steal marketshare from Apple (and, to a far lesser extent, Android).

Traditionally, Microsoft has been content to allow its OEMs to lead the way in hardware, while it futzes with peripherals and focuses instead on software. That’s avoided the tricky-to-balance situation of being both a software partner and a manufacturing rival. Nonetheless, it’s a compromise Microsoft may not be able to strike this time around: Windows 8 tablets need a strong, cohesive message, and what we’ve seen of OEMs’ ambitions, with myriad form-factors (see ASUS and Acer at Computex for evidence) as they frantically grasp for “iPad killers”, that straightforward proposition for customers is in short supply.

With its own tablet, Microsoft could shape the Windows slate scene much in the same way as the three Google Nexus phones have guided Android handset development. The big argument against it – that it disadvantages individual OEMs – doesn’t look to have held true for Android phones, with Samsung seeing its Galaxy S II and S III flagships sell incredibly well despite them not being the official “Google Phones.”

Microsoft already has one underdog on its hands, anyway, in the shape of Windows Phone 7. Still yet to make the segment-busting surge some analysts predicted, the smartphone platform has only really seen momentum with Nokia in recent months, a company notable for being yet to make a play for the tablet market. Ironically, the Metro interface debuted on Windows Phone initially left us desperate for a larger touchscreen device running the same OS, though that UI’s reappearance in Windows 8 means Microsoft’s continual denials of a WP7 slate are somewhat more believable these days.

That leaves what could be seen as the outliers, or more niche, avenues Microsoft might take. The company is a force to be reckoned with in gaming with the Xbox 360, and a gaming-focused tablet could build on that pre-existing momentum. Xbox SmartGlass, the multi-screen gaming system announced at E3 2012 earlier this month, could be an interesting frame to build a play-centric slate within, based on an underlying Windows embedded core – Windows Embedded Standard 8, perhaps – to chase a particular niche rather than every field the iPad plays upon.

We’ve seen Microsoft consider niche devices before, though the company’s track record at bringing them to production is relatively poor. The Courier project is arguably the best-known, the idea being a heavily-tailored interface and suite of functionality on top of a never-seen Windows core. Sadly Courier is highly unlikely to be Microsoft’s big Monday reveal, but there have been whispers of an ebook and multimedia content consumption device that would mimic some of the focus of ereader-slates like Barnes & Noble’s NOOK Tablet (and may even involve a direct partnership with B&N). That comparative specificity of purpose could be sufficient to persuade Microsoft’s OEMs that their Windows 8/RT tablets aren’t in direct competition.

What’s certain is that Microsoft has gradually been building up its portfolio of functionality, strengthening its position in gaming (particularly Xbox LIVE, which is also tipped to be included in the B&N tablet collaboration), enterprise, home entertainment, mobile, and the cloud. The company has been paying lip-service to the idea of convergence and inter-connectedness for years now, but has yet to show us all of the pieces slot together in an holistic way. If it can do that on Monday, it could mark a significant resurgence from a company you’d be wise not to count out.

SlashGear will be at the Microsoft event on Monday, June 18, bringing back all the news – tablet or otherwise!

The Photosynth app automatically stitches your photos together for seamless panoramas. But it goes beyond horizontal spans and can take full spherical 360 degree views. The images created through Photosynth can also be easily shared through Facebook, Bing maps, or a freely hosted account at Photosynth.net. You can share either the still image or an interactive 360-degree version.

The app, however, does require a lot of resources for processing all the high-res images, so it won’t run on 256MB devices, such as the Nokia Lumia 610. It was recently reported that roughly 1.6 percent of Windows Phone apps are not compatible with the Lumia 610. The app requires devices with 512MB or better.

[via PocketNow]

Hardware

Samsung has become surprisingly adept at putting out quality smartphone hardware, even on the low-end of its range. In general build and quality, the Focus 2 feels like a shrunken version of the white Galaxy S II: compact, light, glossy and very solid. The hard plastic shell isn’t the thinnest available, but there’s nearly zero flex, and its gentle curves feel comfortable in the hand. Controls are found mounted within the silver ring surrounding the phone: volume on the left side, power and two-stage camera button (yes!) on the right.

The front of the device is dominated by a 4-inch, 480×800 Super AMOLED display. Margins on the side are small, but fatten out on the top and bottom to accommodate the speaker, front-facing camera and Windows Phone controls. The screen itself is rather typical of Samsung – if you like bright, saturated colors, you’ll be right at home, but if you’re more used to a 720p display or can’t stand the slight fuzziness of PenTile panels, you probably won’t be convinced.

Around the back you’ll find a battery door that uses Samsung’s “snap-on” technique, beneath which is the 1750mAh battery, MicroSIM card slot and not much else. The 5.0 megapixel camera sits next to a tiny speaker. There’s a clever little loop in the speaker grill that pushes up the back of the phone about a millimeter – this ensures that there’s always some space between the back of the phone and a flat surface for speakerphone or video calls. The speaker itself is a little weak, but not nearly so much as some of the others I’ve seen, such as the Galaxy S III.

Under the hood are some respectable specs, even if they won’t set the world on fire. A 1.4ghz single-core processor is paired to 512Mb of RAM – not the best out there, but as we’ll see later, plenty for Windows Phone 7.5 Mango. Internal storage is just 8GB, which you’ll have to make due with, since the Focus 2 lacks a MicroSD card slot. Naturally it’s got all the wireless bells and whistles with WiFi and Bluetooth accompanying 4G LTE. In the box you’ll get the standard wall-wart and data cable combo, plus a surprisingly nice headset with in-line music controls that matches the phone’s glossy white finish.

Software

If you’ve seen one Windows Phone, you’ve seen them all, at least from a software perspective. Aside from AT&T’s rather annoying additions (U-Verse, Navigator, Yellow Pages and more, all of which can be uninstalled) there are no surprises here. If you’re not already familiar with Mango, check out our review here.

The Focus 2 handles Mango with aplomb, even as a budget phone. Navigating the slick and unique interface was quick and fluid, and I didn’t start noticing any slowdown until I began running dozens of apps at once. Speaking of apps, there’s nothing to be done about the lack of them on WP7. While you should be able to find utilities for most tasks, the absence of big names like Pandora is hard to overlook.

Those who are familiar with Windows Phone, or perhaps more likely at this price point, those who haven’t used a smartphone before, will not be disappointed. If you’ve been spoiled for choice of apps on Android or iOS, or you just don’t live in a Windows world, you may want to look elsewhere. WP7 Mango is undeniably beautiful and it’ll handle all the basic tasks of the other big players, but a platform lives and dies on its software support.

Camera and Media

The 5-megapixel camera on the Focus 2 is pretty much what you’d expect: reliable enough for candid snapshots, but “serious” photographers (if the term can be applied to mobile phones at all) will be better served elsewhere. Even in good lighting, I found myself having to adjust the white balance settings for shots where the sun wasn’t directly visible. Colors were erratically over-saturated or muted.

Video is likewise lukewarm. With plenty of lighting the 720p sensor does well enough, but you’ll see some banding when moving around (and with a phone this light, it tends to happen a lot). The VGA front-facing camera is suitable only for video chat – self-pics will turn out better with the rear camera and a little guesswork.

All that said, the two-stage camera button is a fantastic addition (though standard on Windows Phone 7 devices). The shutter is quick to focus and it activated when pressed and held, even when the phone is off. I do not exaggerate when I say, I wish every single smartphone had a dedicated camera button, even when the camera itself is nothing to write home about.

Music is a standard experience, even if it is a little weak coming out of the phone’s speakers. It’s a good thing, then, that the pair of headphones included is a step above the general lot, with easy-to use in-line controls and a microphone. It’s nice to see this inclusion, which is all too often absent on more expensive devices. Video plays well enough, though if you’re constantly browsing YouTube or the like, you’ll want something with a larger screen.

Battery and radio

The 1750mAh battery on the Focus 2 is something more usually found in a much larger smartphone. The combination of an efficient screen and WP7′s generally un-demanding workload mean that the Focus 2 can ho surprisingly long without a charge. Despite some pretty heavy browsing and talking sessions, I couldn’t drain the Focus 2 to less than 40% of its capacity over a 12-hour workday. Those of you who are frustrated with puny run-times shouldn’t have a problem here.

Likewise, the call quality on the Focus 2 is surprising. Speaking with friends and family member across the country was sharp and clear, despite the generally spotty coverage in my mountainous area. While I don’t yet live in an AT&T 4G LTE coverage are, I was at full bars nearly all the time, though actual speeds were a bit disappointing in the 1 to 1.5mbps range, where other AT&T phones tend to get at least 2mbps.

Value

The Focus 2 is undeniably a good deal at $50 on contract. The combination of solid specs, great battery life and good ergonomics would make it an instant recommendation… if it weren’t for other AT&T phones too close to it in the price range. For $50 more you can get the excellent Nokia Lumia 900, which beats it in nearly every category and looks great to boot. If you’re wiling to switch to Android, the 4.5-inch HTC Vivid is just $49.99.

If you’re in an area without LTE or you simply don’t care about the faster data speeds, your options grow even more. There’s the still-respectable iPhone 3GS, currently going for a dollar on AT&T’s website, the original HTC Titan for just a penny, or the 720p LG Nitro HD for the same price. Don’t get me wrong, the Focus 2 is a solid phone… but if I had my heart set on it, I might wait a couple of months for the price to drop to free or practically so.

Wrap-up

The Samsung Focus 2 is a very tidy device, and currently the cheapest phone on AT&T to combine LTE and Windows Phone 7. Anyone who purchases it won’t be disappointed, especially those who require long battery life. That said, if a great camera or a big, high-res screen are in your list of must-haves, look elsewhere.

It’s also hard to recommend the Focus 2 above the Nokia Lumia 900. The extra fifty bones is worth it in basically every category. Likewise, the other alternatives mentioned above can get you access to more apps (if not such a polished OS) for the same or less money. The Focus 2 is ideal for those who want to get into Windows Phone 7 for as little money as possible, without sacrificing build quality or an LTE connection. The phone is on sale starting today for $49.99 with a two-year contract.

The Focus 2 would have been a high-end device about two years ago, and still manages to present a better front than most of the field below $100. Samsung’s been making touch-based smartphones for a long time (and a lot of them, too) and knows how to make a device feel welcoming. It”s not the thinnest phone around, but it is one of the lightest, and still manages to cram in a 4.0-inch screen with Samsung’s Super AMOLED technology. (PenTile haters beware: at 800×480, you can certainly tell the difference between this and a standard RGB display.)

Controls and layout are Samsung standard, with the power button on the upper right side and the volume controls opposite them. There’s also a camera button on the lower right side – always, always a welcome addition to any phone, thanks to quick and easy access to the camera app. The Focus 2′s 5-megapixel shooter probably won’t be beating out ny higher-end phones, but it’ll sub in for a point-and-shoot just fine thanks to an integrated flash. Speaking of cameras, there’ a new VGA front-facing cam for video calls and the like.

It’s all wrapped in glossy white plastic that feels surprisingly solid for a budget phone, and handily hides fingerprints. The shiny metal ring separating the front from the back breaks the icy aesthetic a bit, but it does handily include all the controls. Pop off the back and you’ve got easy access to the battery and MicroSIM card, but unfortunately, no SD card option. For storage you’ll have to settle for the *GB of internal – again, not bad at all considering the price.

Other specs include a 1.4Ghz single-core processor, 512MB of RAM (in my experience, plenty for Windows Phone 7) and of course an AT&T LTE connection. Going over the software quickly revealed an adequately snappy Windows interface, though AT&T’s pack-in apps are here in abundance. We’ll have an in-depth review of the phone up before it launches on Sunday, May 20th for $49.99 on a two-year contract.In the meantime, check out the unboxing video below:

Why has the United States been so difficult for Nokia?

It was a combination of factors:

1. Nokia’s business model used to be based almost entirely on volume sales with minimal customization. The U.S. is a carrier-controlled market where the carrier chooses phones and dictates which phones reach the market and which functionality. To succeed in that environment, you need to be willing to customize your devices to meet specific carrier needs – which can mean filling holes in their portfolio or supporting their unique technologies. Nokia simply was not set up to do that in the past.

2. Nokia hated CDMA, expected it to fail, and under-invested in the technology. CDMA makes up more than half of the U.S. cellular subscriber market.

3. Over the years, Nokia successively ignored every form factor that U.S. consumers liked – clamshell phones, super-thin phones, QWERTY phones, and touchscreen phones. Each time, Nokia would lecture everyone about the problems with the new form factor. Eventually, Nokia would begrudgingly launch one or two models with that form factor, but by that point the rest of the industry had long since moved on to the next form factor, which Nokia would publicly disparage… and then the cycle would start again.

4. Nokia’s smartphone line was based on Symbian. Symbian never caught on in the U.S. Part of the problem was that the user interface was horrible, and the OS’s advantages (like the ability to selectively choose data networks) were completely lost on U.S. consumers. Another part of the problem was that Nokia didn’t bring its best Symbian phones to U.S. consumers because of #1, #2, and #3.

5. Nokia would occasionally talk about the importance of the U.S. market with the media and investors, but the company never truly considered the U.S. all that important. If it had, it would have made structural changes to address items #1 – 4.

Does Nokia have a real chance to grow for market share in the U.S. with its Lumia models?

Other than the Lumia models, Nokia has no share of the U.S. market. This isn’t like the UK where Nokia needs to get consumers to buy Lumia phones instead of Symbian models and can rely on rapidly declining – but material – sales of S40 phones. There are no other Nokia phones sold here. Of course, an optimist would say that there is no place to go but up. If Nokia can convince U.S. consumers to consider buying a Windows Phone instead of an iPhone or Android phone, then, yes, it certainly has a chance to grow market share.

It is worth noting that in Finland and throughout Europe, Nokia is a well-known, premium brand. This is not the case in the U.S., where older consumers think that Nokia is a Japanese company that used to make clunky bar phones, and younger consumers have never heard of Nokia at all — aside from the Nokia Theater in L.A. where American Idol TV show finals are televised. Nokia will have to build its brand along with the challenge of convincing consumers to invest in a phone that uses an unfamiliar operating system.

How would you characterize Nokia’s situation in the United States now? Is Nokia’s alliance with T-Mobile and AT&T enough?

The carriers do not want to be overly dependent on Apple – which they have almost no control over – or Google – which actually competes with them in certain situations and acts in ways that the carriers find irrational. So it is in the carriers’ best interest to help Microsoft establish a viable third ecosystem. That doesn’t mean it will automatically succeed, but it explains why T-Mobile and AT&T are eager to invest in Windows Phone at retail and with advertising. However, Nokia needs to get distribution at Verizon Wireless as well as AT&T to have a significant impact on the U.S. market overall. Before that can happen, Nokia needs Microsoft to create a version of Windows Phone that supports CDMA/LTE.

Nokia got off to a rough start by launching the Lumia 900 on a holiday, then discovering bugs in the software. However, its response was amazingly decisive and swift (investigating the problem, confirming it, fixing it, and offering refunds – all within two weeks), and I don’t see any lingering negative after effects. I am not a fan of the Beta Test ads; nothing Chris Parnell says can be taken seriously (that’s core to his comedy), and by calling the incredibly polished iPhone “beta,” Nokia loses credibility. However, Nokia’s merchandising strategy has been brilliant – the cyan (bright blue) phone stands out in a sea of black rectangles, and giving nearly every AT&T store rep a Lumia 900 guarantees that they are familiar with the phone and increases the likelihood that they will endorse it. Regardless, if a consumer asks, “what phone do you use?” the answer is a Lumia 900.

Apps play a very important role in cellphone marketing. Can you describe the competition for app development between Apple, Android and Microsoft applications? Who is the strongest player?

Apple is the strongest and growing stronger. Android has also reached critical mass for apps in smartphones (though not yet in tablets). At this point, it is unlikely that Microsoft will ever fully catch up, but if it can get enough of the important apps along with a commitment from developers to support the OS even if they develop for iOS first, Microsoft can try to use other aspects of the platform (such as the unique user experience, cloud services, or exclusive apps) to attract consumers to buy the phones.

The Omnia M will feature a 4-inch Super AMOLED screen with a WVGA resolution, single-core 1Ghz processor, 384MB of RAM, five megapixel camera with LED flash, and 4GB of internal memory. Windows Phone 7.5 is onboard, as are all the usual radios: HSPA up to 7.2Mbit/s, WiFi b/g/n, Bluetooth 2.1, and A-GPS.

A front facing camera has found its way onto this model for video calling via Tango or Skype, and battery capacity is rated at 1,500mAh. Samsung is also bundling some custom software with the phone, such as Family Story, a way to share content to family members, plus its ChatON messaging service also available on iOS and Android. AllShare takes advantage of streaming via DLNA, and the standard Microsoft services such as SkyDrive and Xbox Live integration are par for the course.

Samsung says the phone will hit Europe initially then “other regions” later, but didn’t mention pricing or availability. Keep an eye on your local retailers in the meantime.

[via SammyHub]

That undercuts the Nokia Lumia 900, also running Windows Phone and pairing it with LTE on AT&T’s network, though the ecosystem of devices supporting Microsoft’s OS is hardly saturated right now. The Focus 2 will be available in “pure white” only, and measures 10.98mm thick and tips scales at 4.3oz.

All of the usual Windows Phone functionality is present, such as voice control and Bing integration, and AT&T Is positioning the handset as a cheaper way for new owners to get on the smartphone ladder. Even by opting for a cheaper device, though, they’re not exactly missing out: Microsoft’s stringent specification control around Windows Phone devices mean a budget handset like the Focus 2 isn’t much different from more expensive models running the same OS.

We’ve always been fans of Samsung’s Super AMOLED technology, and the 4-inch form-factor has plenty of fans for its compromise between portability and browsing real-estate. The Samsung Focus 2 will hit AT&T on May 20, priced at $49.99.

According to Pocket-lint, which has spoken to an LG spokesperson, the reports are all false. “None of it is true. Korea Herald is showing its speculative side again,” said the spokesperson. “We are still on board with Windows Phone, but right now, we’re focusing on Android because that’s where the demand is.”

LG hasn’t had much success with its Windows Phone 7 devices, but it isn’t planning to ditch the platform. It plans to focus on Android but will continue to research and develop Windows Phone devices. “Regardless of which OS, LG is committed to offering consumers as wide a choice as possible,” said the LG spokesperson.

[via Pocket-lint]

“We continue to view Nokia’s cash position as a positive factor” S&P’s said in its statement about the cut, “but now expect net cash to fall much faster than we had previously anticipated to EUR3.5 billion-EUR4.0 billion at Dec. 31, 2012, from EUR4.9 billion at March 31, 2012.”

Just as with the other ratings agencies, S&P’s cites fears around Nokia’s Lumia recovery with Windows Phone as a critical aspect of whether the firm recovers or not. Meanwhile, Nokia has issued pretty much the same statement as it did before, insisting that this current dip is par for the course when you’re restructuring.

“As we have detailed in recent announcements, Nokia is in the middle of a transformation program which encompasses every aspect of our business” Nokia CFO Timo Ihamuotila said in response to S&P’s new rating decision. “We are implementing a decisive action plan to position our company for future growth and success.”

“The main focus of these actions is on lowering the company’s costs, improving cash flow and maintaining a strong financial position,” Ihamuotila concluded, “while bringing attractive new products to market.”

The beta version of the app has been upgraded to include friend management support, with the ability to invite new contacts, accept invitations from others, and then block and unblock contacts. Group chat is also supported.

3G/4G and WiFi connections can be used, and Skype has tested a handful of the existing Windows Phone models for compatibility. The Nokia Lumia 710, Lumia 800 and Lumia 900 will all work, as will HTC’s Titan and Radar, and Samsung’s Focus S and Focus Flash. It’s worth noting that not all have front-facing cameras, however, which will undermine the usefulness of video calling.

That’s not the only limitation. According to Skype, you won’t be able to use a Bluetooth headset with the app on Windows Phone, and it demands 512MB of RAM so the new range of cheaper, Tango-based handsets – such as Nokia’s Lumia 610 - which have just 256MB won’t be able to run it.

Most frustratingly, incoming calls will only be received if the Skype app is in the foreground; if you’re doing something else, you won’t get a notification. That significantly undermines the app’s usefulness at this stage, and hopefully Microsoft and Skype are working on rectifying it.

No further commitment was given to the idea, though it’s not hard to read between the lines and assume a new Windows Phone device is headed to Verizon. Currently, the carrier only offers one phone, the HTC Trophy, part of the company’s initial line-up of models dating back to the first days of the OS.

In the meantime, AT&T has obviously pushed ahead with Nokia’s Lumia 900. The Finnish company announced dire financial results of its own today, but did namecheck the US market as one where its Windows Phones were doing better. “We exceeded expectations in markets including the United States,” Nokia CEO Stephen Elop said, “but establishing momentum in certain markets including the UK has been more challenging.”

Jumping on board with a Lumia of its own would be an obvious route for Verizon to take. Nokia currently has two CDMA models, the Lumia 800C and 610C, for the Chinese market, so versions for Verizon – most likely with LTE for its fast-growing 4G network – wouldn’t be too great a leap.

“The point I was attempting to make was simply that existing Windows Phone applications will run on the next version of Windows Phone. This is the same guidance that Microsoft shared late last year”  Silva now says. “I mistakenly confused app compatibility with phone updateability, which caused the rumors we saw yesterday. I did not intend to give the impression I was offering new guidance on any products under development or their upgradeability.”

The rumors prompted a second round of leaks, with further insiders saying that, in fact, no existing Windows Phone would be getting an upgrade to Apollo. Microsoft continues to be coy, with Silva saying “While we have given Windows Phone developers this preliminary guidance on app compatibility to help them with long term project planning, Microsoft does not have any further news to share on future products at this time.”

Although misleading information is never good, Silva’s blunder has nonetheless opened up an interesting avenue: whether those supporting Windows Phone by being early adopters of the platform will find themselves left out in the cold when the next iteration is released. Pressure on Microsoft to detail the exact upgrade path is only going to increase, though the software company may find it difficult to balance transparency about the future with preserving current sales.

“We exceeded expectations in markets including the United States,” Elop said of Lumia sales, “but establishing momentum in certain markets including the UK has been more challenging.” Nokia blames “the strong momentum of competing smartphone platforms relative to our Symbian devices” for its decline in smartphone sales year-on-year, with lower seasonal demand  ”which more than offset the sequential increase in Nokia Lumia device volumes” hurting them quarter-on-quarter.

Nokia warned of underwhelming performance earlier this month, when it said it had sold around 12m smartphones. In actual fact, according to the more accurate numbers today, the Q1 2012 figure is actually 11.9m. Two million of those were Lumia Windows Phones.

Meanwhile, Nokia received a “quarterly platform support payment” totaling £250m from Microsoft for the continued use of the platform. All in all, it makes for uncomfortable reading, Nokia’s finances looking altogether shaky despite the company sitting on a reasonably full bank account.

Full Stephen Elop statement:

“We are navigating through a significant company transition in an industry environment that continues to evolve and shift quickly. Over the last year we have made progress on our new strategy, but we have faced greater than expected competitive challenges.

We have launched four Lumia devices ahead of schedule to encouraging awards and popular acclaim. The actual sales results have been mixed. We exceeded expectations in markets including the United States, but establishing momentum in certain markets including the UK has been more challenging.

At the same time, the lower price tiers of our industry are undergoing a structural change, and traditional feature phones are challenged by full touch devices. As a result we are taking deliberate measures to continue to renew our Series 40 platform, and we plan to strengthen our line-up in Q2 2012. We are making investments in our Mobile Phones business unit aimed at addressing the gaps in our offering.

We have a clear sense of urgency to move our strategy forward even faster. We are pursuing step function changes by having launched the Lumia 610 and Lumia 900 in the first quarter, expanding market coverage, increasing advertising, introducing key customer-requested features and broadening our most successful go-to-market activities. At the same time, we have focused our efforts in the low-end of smartphones and feature phone asset to drive improved business results and conserve cash.

We are confident in our strategy and focused on responding urgently in the short term and creating value for our shareholders in the long term.”

A trusted insider tells The Verge that there will be no upgrade from the current Mango release of Windows Phone to the new Apollo version. Microsoft’s own statement on the evangelist’s comments would seem to confirm something is afoot, saying that “We have stated publicly that all apps in our Marketplace today will run on the next version of Windows Phone. Beyond that, we have nothing to share about future releases.”

The new sources echo comments earlier in the year from unnamed insiders at Mobile World Congress, telling the::unwired that Microsoft’s minimum hardware requirements for Apollo would leave all existing devices out in the cold. Right now, Windows Phone only supports single-core devices with WVGA displays, but tipsters claim Microsoft will shift to demanding dual-core processors and higher resolution screens.

Such a suggestion was reiterated by ZDNet‘s sources the following month, though with suggestions that the limitation could be fueled by carriers rather than necessarily hardware shortcomings. None of Microsoft’s OEM partners will comment on upgrades, and Microsoft itself remains coy on the potential for existing phones to get Apollo when it releases the next version. Apollo is expected to go live later in 2012.

CEO Stephen Elop blamed unexpectedly low demand for entry-level handsets in developing markets for part of Nokia’s problems, with Lumia sales not accelerating fast enough to balance out the shortfall. With Q1 2012 thus seemingly a write-off, Nokia has only Q2 and Q3 – six months in all – to turn things around, according to both IHS analyst Ian Fogg and Canalys’ Peter Cunningham.

“Nokia stands on the brink of failing with its smartphone strategy, again” Fogg says. To his mind, the biggest issue the company faces is a drop in both shipments and average selling price (ASP) for each handset. Nokia revealed that it made just €220 on average on each Lumia sold. “If shipments are struggling but ASP’s are good, then a handset maker always has the option of sacrificing a degree of per device revenue to drive adoption” Fogg explains. “Nokia has a little tactical room, but it will rapidly vanish unless the results improve in Q2 and Q3.”

Cunningham agrees, though argues it’s still “too early to write Nokia off” completely. “It is still in the middle of its transition to Windows Phone, but it doesn’t have the luxury of time” he points out. “The next six months will be critical in the company’s long-term future. The Lumia 610 needs to be a success, and it needs some hit products in the market in time for Christmas.”

Nokia’s problem, Fogg suggests, is that while it is doing plenty of things right – “attractive and differentiated industrial design” in phones that shipped to schedule and at the right price – “Microsoft appears to have stood still.” The platform still lacks app traction, which is primarily something that falls at Microsoft’s feet.

Even if that’s the case, Microsoft’s dropped ball could knock Nokia off its perch if the Finnish firm isn’t careful. The time has come, both analysts agree, to at least have a possible Plan B on the drawing board, just in case Windows Phone doesn’t provide – on its own – sufficient heft to rescue the rest of Nokia’s business.

Nokia’s mobile phone division – which makes basic dumbphones – has always been the volume side of the company’s business, versus the “smart devices” team pushing out smartphones. In Q1 2012, Nokia apparently sold 71m mobile phones and 12m smart devices; of that 12m, around 2m were Lumia Windows Phones, the remainder running Symbian of one version or another.

The company blamed “competitive industry dynamics … particularly in India, the Middle East and Africa and China” for the slump in sales, though that shouldn’t have come as too great a surprise. Nokia warned that the so-called developing markets it had counted on for steady turnover was declining faster than expected back in January.

“Changing market conditions are putting increased pressure on Symbian” Nokia CEO Stephen Elop said at the time, highlighting that in “certain markets, there has been an acceleration of the anticipated trend towards lower-priced smartphones with specifications that are different from Symbian’s traditional strengths.”

The painful lesson is that while the “Next Billion” may be one of Nokia’s primary targets, owning a Nokia device no longer appears to be an aspiration for that audience. That’s a big rug pulled out from under the company’s collective feet: smartphone gross margins continue to tumble, down from 19.9-percent in the previous quarter to 16-percent in this one. In fact, what appears to be aggressive discounting so as to drive Windows Phone sales has pushed the average selling price of each handset to just €220 ($289) apiece, considerably lower than the €270 list price of the Lumia 710 (that, for the period in question, was the cheapest Windows Phone Nokia offered).

Sometimes playing underdog works in Nokia’s favor. The company’s response to the AT&T Lumia 900 data bug – crediting customers $100 as well as in effect dropping the price of the handset to free until April 21 – was admirably swift. However it also gives Nokia an excuse for slashing its prices to drive adoption: further short-term price cuts to the Lumia 900 seemed inevitable, especially as AT&T reacted to third-party retailers further discounting the phone. Now, rather than facing criticism that it has been forced to make the phone cheaper because of mediocre sales, Nokia could instead portray keeping the Lumia 900 at free-on-contract as a generous continuation of its prompt apology.

Good vibes don’t keep stockholders satisfied, however, and Nokia’s share price is down around 15-percent after its bad news this morning. The short-term outlook seems equally grim; Nokia’s position in the phone ranking charts is only likely to slump before there’s any sign of a turnaround. Nokia hasn’t failed with its Lumia line-up, but it needs to accelerate into 2012 if it’s to balance out the dwindling appeal of its cheaper devices.

“Our disappointing Devices & Services first quarter 2012 financial results and outlook for the second quarter 2012 illustrates that our Devices & Services business continues to be in the midst of transition,” CEO Stephen Elop said in a statement today. “Within our Smart Devices business unit, we have established early momentum with Lumia, and we are increasing our investments in Lumia to achieve market success. Our operator and distributor partners are providing solid support for Windows Phone as a third ecosystem, as evidenced most recently by the launch of the Lumia 900 by AT&T in the United States.”

Overall, devices and services net sales are expected in the region of €4.2bn ($5.52bn), with smartphones – not limited to Windows Phones – comprising €1.7bn ($2.2bn) of that, at 12 million units. Average selling price for a Lumia Windows Phone was €220 ($289), and Nokia says it has “ seen sequential growth in Lumia device activations every month since starting sales of Lumia devices in November 2011.”

Still, the company isn’t leaving anything to chance. Nokia is apparently pumping more money into Lumia, so as to broaden the number of markets in which its Windows Phones are available, while tweaking pricing lower for its dumbphones for the “Next Billion” segment; it will also accelerate new dumbphones in Q2 2012.

“We are continuing to increase the clock speed of the company,” Elop insists. “The change is tangible, and we are proud of the way Nokia employees are quickly responding to the needs of consumers and partners.” Full Q1 2012 results will be revealed on April 19.

The 610 NFC is certified for contactless payments both with VISA’s payWave system and MasterCard’s PayPass. Those with compatible bank accounts should be able to use their Lumia 610 NFC to tap-to-pay in stores with NFC-enabled registers.

Meanwhile, the NFC will also be used for hooking up accessories, such as Nokia’s Play 360 speaker, more easily. Rather than demanding users scan for new Bluetooth devices and then punch in a PIN-code, the Lumia 610 NFC will allow them to simply tap the handset against the accessory and see it automatically pair up.

Nokia has added its own NFC software stack on top of Windows Phone, accompanying the extra NFC hardware into the basic 610. Microsoft has promised native NFC support in Windows Phone sometime this year, so it’s unclear how Nokia’s implementation differs from that “official” upgrade. Still, it seems Nokia isn’t willing to wait. “We’re bringing NFC right across our portfolio” Ilari Nurmi, head of product marketing for Nokia’s Smart Devices business unit said today, promising to support operators and business in rolling out “NFC payment and ticketing solutions.”

No pricing for the Nokia Lumia 610 NFC has been confirmed, though the company says it’s hoping to use the handset to push both Windows Phone and contactless payments to a more affordable price point. It will arrive early in Q3 2012.

[Thanks Kote!]

That means the same 3.7-inch WVGA LCD display and 5-megapixel autofocus camera, along with 256MB of RAM and an 800MHz processor that help keep the 610′s price low.

Nokia has used NFC on some of its recent Symbian and MeeGo devices, such as the N9 and the 700, with the short-range wireless technology used to simplify establishing connections between handsets and accessories. For instance, Nokia launched its NFC-enabled Play 360 speaker alongside the N9, relying on Bluetooth A2DP to stream audio, but NFC to initially make the pairing.

Update: thegadgetbuff managed to snag a jerky copy of Nokia’s original video:

Going by Nokia France’s communications manager Xavier des Horts, the Lumia 610 NFC is likely to be made official later on today: 2pm local time, a teaser billboard suggests, which would mean around 8am Eastern. More on the Nokia Lumia 610 in our hands-on with the budget Windows Phone from MWC 2012.

Update: Nokia has made the Lumia 610 NFC official.

AT&T had already impressed with its $99.99 price tag for the Lumia, undercutting Android-powered rival flagships and pitting the Windows Phone 7 device directly against the iPhone 4. Although neither the carrier nor Nokia has revealed sales figures, the 900 has already grabbed the top sales spots with at least one big-name online retailer.

However, a connectivity bug was reported soon after the handset’s release, with the Windows Phone dropping its data connection unexpectedly. “In short, a memory management issue was discovered that could, in some cases, lead to loss of data connectivity” Nokia now says. “This issue is purely in the phone software, and is not related to either phone hardware or the network itself.”

Existing owners will be able to update their phone’s software via the Zune desktop PC app – with the upgrade expected on or around Monday, April 16 – or simply swap their current handset for a new, already updated Lumia in-store.

“At $99.99 at AT&T, we think the Lumia 900 is already a fantastic deal” Nokia argues. “And now, it’s unbeatable.” More on the phone in our full review.

What we’re seeing here, or what we very well might be seeing here in the very near future, is the ability for Windows Phone users working with next-generation hardware to use both voice commands and non-touch gestures to control their phone’s many abilities. Over at WMPoweruser we’re reminded that Windows Mobile 7 (a now-dead platform) was being set up for motion gestures before the plan was scrapped in early development. Perhaps we’re seeing that dream come to fruition now?

“Windows Mobile 7 will use motion gestures, something the iPhone does not. It will not use an intricate and complicated series of gyroscopes and accelerometers. Instead, it will use the camera on the phone to detect motions and create appropriate actions. You will be able to shake, twist and otherwise manipulate the phone and get things done. The phone will be able to perform actions when placed face down on a surface, and it will know when it is in your pocket or bag.” – Microsoft Internal, pre-2009

Of course you’ll also remember, perhaps, that Microsoft also previewed technology connecting Windows Phone to Kinect on the Xbox 360 all the way back in February of 2011. We’ve not seen really anything else from them regarding this connection since – but even this early preview has promise:

What would you do with a Kinect’ed Windows Phone? Make it take photos from afar? Perhaps play some strange teeny-tiny gesture controlled games? The possibilities are endless!

On Monday, the black Lumia 900 was at position 119 in the broader “Cell Phones & Accessories” category, with the cyan model following behind at 214. Unlike the “Cell Phones with Service” category, which solely includes new phones on agreements, this category throws in far cheaper accessories such as cases, chargers and cables, and is considerably tougher for a phone to make an impact on.

As of today, however, the black Lumia 900 has moved up to 30th in the list, with its cyan counterpart at 77. The third most popular device, Motorola’s DROID RAZR MAXX, is at 198, meanwhile.

Neither AT&T nor Nokia have announced any official sales figures so far, though the carrier is believed to have spent in the region of $150m for its Lumia 900 promotional campaign. Analysts predicted underwhelming demand but it looks as though that may not necessarily be the case.

More on the AT&T Nokia Lumia 900 in our full review.

In fact, the retailer already has the exclusive on Nokia’s white Lumia 800 and Lumia 710, making it pretty much the place to go if you want a pale version of the Finn’s phones. Pre-order customers will also get a free Nokia Play 360° wireless speaker.

As in the US, the UK version of the Lumia 900 will have an 8-megapixel camera with autofocus, an LED flash and 720p HD video recording, along with a front-facing webcam and 1.4GHz single-core processor. However, since there’s no commercial LTE network to make use of the US model’s 4G, it will make do with DC-HSDPA instead.

Although Windows Phone is still far behind its Android and iOS rivals in terms of market share, the Lumia 900 is a solid device and the OS is straightforward to use. More details in our full Lumia 900 review.