Nokia Unveils First LTE-Capable Windows Phone on AT&T

Nokia (NYSE:NOK) took a giant stride forward towards increasing its U.S. smartphone presence with the unveiling of the much eagerly awaited 4G LTE-capable Lumia 900 at the Consumer Electronic Show (CES) Monday. ^[1] With this official announcement, the Lumia 900 becomes Nokia’s first Microsoft (NASDAQ:MSFT) Windows Phone-based smartphone to be offered with 4G LTE support and will be made available exclusively on AT&T’s (NYSE:T) network in the coming months. This will also be Nokia’s second smartphone to enter the U.S market this year after the Lumia 710, that will be making an appearance on T-Mobile’s network on January 11th.

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While the Lumia 710 is a low-end smartphone that addresses the needs of first-time smartphone users, the 900 is more feature-rich and has been designed keeping in mind the higher-end smartphone market. Along with a larger 4.3-inch AMOLED display that makes for a richer content experience, the Lumia 900 will also have a front-facing 1 megapixel camera for video calling.

LTE capabilities will help Nokia add more carriers

We talked about how Nokia needs to focus on building stronger relations with the telecom carriers this year, as it was a big reason why it had failed in its earlier U.S. attempts. Wireless carriers have been splurging on building out new LTE infrastructure and will therefore be focusing on LTE-capable smartphones to recover their LTE network costs as soon as possible. Nokia’s new Lumia 900 will not only address that need but also help it differentiate itself from the iPhone pack as well as help it compete with Samsung and HTC, who have been selling LTE-capable Android phones since last year. (see Nokia’s New Year Resolution: Spread Carrier Love)

Having added AT&T and T-Mobile to its carrier list, Nokia will now look to rope in Verizon and Sprint as well, which an LTE-capable smartphone in its portfolio should help.

We estimate that Nokia’s market share of mobile phones in developed markets has declined from around 25% to around 17% over the past year as the company went through a painful transition from its older Symbian platform to Microsoft’s latest Windows Phone platform. However, now that the period is over and the Microsoft partnership has started bearing the first fruits, Nokia will be looking to regain a lot of that market share back. A strong marketing push and addition of more carriers hold the key.

Developed markets account for over 13% of our $6.84 price estimate for Nokia. Our Trefis price estimate is nearly 45% ahead of Nokia’s current market price.

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1. Nokia Lumia 900 LTE Windows Phone, exclusive for AT&T, theVerge, January 9th, 2012 [↩]