Is The Nokia Lumia 1520 Big Enough To Boost Windows Phone 8

Chris Lau, Kapitall: Nokia released a new Lumia, running Windows Phone 8. So will the operating system get a lift?

On October 22, Nokia (NOK) released a Lumia 1520. This smartphone is a six-inch device with 1080p full HD display. But this launch may be a non-event for shareholders of Microsoft (MSFT) and Nokia.

Click on the interactive chart to see price data over time. Sourced from Zacks Investment Research. 

While Nokia is the first to bring a six-inch phablet (typically smartphones with screens between 5-6.9 in) on Windows Phone to the market, there are a number of reasons to be unexcited about the release.

Concerns

First, there is no stylus. Samsung’s Note 3 phablet device includes a stylus pen to facilitate usage. The pen is one of the reasons why consumers like using a large-sized device.

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Second, the Windows Phone 8 (WP8) environment is still not mature. It lacks many apps that exist on other ecosystems. Microsoft was able to boast that it had 170,000 apps in the store as at August 2013, but it is still a common complaint from users.

Without sufficient support for many apps, it will continue to be a struggle for Microsoft to lure customers away from Google’s (GOOG) Android and Apple (AAPL) phones.

Click on the interactive chart to see quarterly sales over time. Sourced from Zacks Investment Research.

Bright spots

There are still some bright things to expect from the Lumia 1520 launch. The handset is powered by a Qualcomm (QCOM) quadcore Snapdragon 800 CPU. If the device performs better than an Android device, it would be a vote of confidence for the Windows Phone 8 environment.

The imaging sensor is a PureView, which outputs 20MP images.

Another positive for Lumia 1520 is the large screen real estate. Microsoft and Nokia may have a re-designed metro interface that will make better use of the screen area. This would differentiate the new phone from other Lumias, and from competitors like Samsung’s (OTC:SSNLF) Note 3.

Conclusion

Nokia and Microsoft shares should not make big moves based on the Lumia 1520 announcement. Microsoft’s shares are being driven largely by strong quarterly results based on server sales. Nokia’s shares are elevated partly because Nokia is exiting the phone market.

Nokia also has excess cash and will be making moves to boost its position in networking and map services. Still, it is good to see Lumia releasing new products, and should be positive for Microsoft as it takes steps to be relevant again in the mobile marketplace.

 

(Written by Chris Lau, a Kapitall Contributor. All data sourced from Zacks Investment Research.)

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