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Microsoft Devices unveils budget Lumia 535 in Dubai

Redmond’s hardware unit throws gauntlet down to low-end market players

Both Lumia 535 handsets run the latest build of Windows Phone 8.1.
Both Lumia 535 handsets run the latest build of Windows Phone 8.1.

Microsoft Devices Middle East today introduced the Microsoft Lumia 535 handset in both single- and dual-SIM variants, as it announced plans to compete in the budget smartphone market.

GALLERY: Microsoft Lumia 535

"Microsoft was founded on the vision of a PC on every desk, in every home," said Jon French, vice president, Microsoft Devices Middle East. "And I don't think any of us could argue that Nokia's done more to proliferate mobile technology around the world than any other mobile company. So with the two companies coming together, we're able to reach new and exciting price points and make sure personal computing and mobile reach more and more people."

Both devices will sell at "well under AED500" according to French, who gave a tentative release date for the UAE market of "early December".

Both Lumia 535 handsets run the latest build of Windows Phone 8.1. They offer a number of integrated Microsoft services, wide-angle 5MP front- and back-facing cameras, and come with 5-inch qHD displays.

GALLERY: Microsoft Lumia 535

Microsoft's play for the budget market comes from a desire to get a greater number of consumers using its services. Earlier this year, the company's devices arm U-turned on its previous commitment to Nokia's legacy X series of handsets, which are Android-compatible. CEO Satya Nadella instead chose to focus on a Microsoft-only devices strategy, and go after consumers in emerging markets.

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French cited UAE regulator figures that claim 46% of connected devices in the Gulf nation are Nokia phones. French is hopeful that those consumers, and others across the region, can be persuaded to identify with the Lumia brand.

GALLERY: Microsoft Lumia 535

"Lumia will become one of those brands that helps us light up the world of Microsoft services," he said. "We believe Lumia stands for innovation, design, quality, fashion; and with the acquisition of Nokia by Microsoft, Lumia joins a great stable of brands: Xbox, Surface, Skype, Office."

Microsoft may find it difficult to compete in a crowded budget market that is increasingly dominated by Chinese manufacturers that are also snatching more share in upper-tier markets. Wary of slipping margins in these segments, cost-conscious BlackBerry, a one-time smartphone leader, this week announced its intention to reduce the number of handsets it releases in a year.

"I'm not going to build a general purpose device, simply because it is a 5-inch touchscreen," said CEO John Chen. "The Chinese can build one for 75 bucks; I can't get enough parts together for 75 bucks."

GALLERY: Microsoft Lumia 535

As a relative newcomer to the smartphone market, Microsoft may struggle to fare better than BlackBerry, unless it can interest more consumers in its ecosystem.