Nokia will slash prices of Windows Phone devices

FINNISH PHONE MAKER Nokia is so sure that its upcoming Windows Phone handsets will sell like hotcakes that its CEO Stephen Elop has already said that it will slash prices.

Nokia might not have been exhibiting at last week's Mobile World Congress, but its decision to jump into bed with Microsoft was the talk of the show, with many wondering if Elop's decision to hook up with his former employer would result in the firm releasing successful handsets. Barely a week since the announcement, Elop has said that he expects the price of Nokia handsets running Windows Phone software to reach "a very low price point", adding that Nokia has "become convinced that we can do that very quickly".

Usually companies slash prices on products when they are not selling well or when trying to clear stock for a new product. Given that Windows Phone is new for Nokia, that suggest the firm realises that it will have a hard time flogging Windows Phone devices.

Nokia's price cutting plan is not without precedent. In the US, Microsoft resorted to selling Windows Phone 7 devices on a buy-one-get-one-free basis in the hopes of boosting sales.

Elop is banking on Nokia loading Windows Phone on as many devices as possible through the firm's product range. With Google's Android starting to appear on devices priced below £100, Nokia will need to slash prices fast if it is to hold on in a market where it has traditionally been strong.

Elop also told Finnish journalists that he had sold all of his Microsoft shares on 17 February and purchased 150,000 shares in Nokia, days after it fell 20 per cent on the news of its tie-up with Microsoft.

Nokia had better hope that Elop's gamble of selling cut price Windows Phone handsets pays off, otherwise the future could start looking grim for the former titan of the feature phone business