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No new Lumia flagship? Smart move, Microsoft

Gregg Keizer | March 3, 2015
Microsoft's decision to wait until Windows 10 arrives to deliver a high-end Lumia smartphone may have irked some of the company's loyal customers, but it was the smart move, analysts said today.

Instead, said O'Donnell, Microsoft can use the hype around Windows 10's debut later this year to promote a flagship Lumia. "When Windows 10 is ready, then bingo, out comes [a flagship]. That's just smart."

Microsoft's strategy — which has been predicated on handing out free OS licenses to ODMs and thus focusing on the low end — is a "long-term play," added O'Donnell, making for another reason not to rush out a top-tier device.

That strategy may ultimately fail, but realistically it's what Microsoft has at hand. "Even long term they're going to have a hard time with the utter dominance of Android and iOS," O'Donnell continued. "If they get to 8% to 10%, which I think they can, that would be huge for them. But I don't know that that's getting them anywhere near the level of really competing [with Android and iOS]."

Nor are the Lumia 640 and 640 XL the placeholders some see them as, argued Rubin. "These 'step-up' smartphones are where Microsoft is seeing the most sales," he said, using a label for low-priced devices attractive to first-time smartphone buyers moving up from feature phones. "They're beefing up that step-up range, something the larger [5.7-in.] display [of the Lumia 640 XL] lends itself to."


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