Nokia struck a deal with China Mobile to sell a Chinese variant of its flagship Lumia 920 smartphone, the 920T, which will be available for order by the end of the year. News of the partnership caused Nokia's shares to jump over 8 per cent higher on the Stoxx Europe 600 index, making it the best performer of the day on Wednesday, according to MarketWatch.
Nokia partnered with China Mobile on the Lumia 920T.
China Mobile, the world's largest mobile operator with over 700 million subscribers, will sell the Lumia 920T for 4599 yuan (€564) without a contract. The device will be compatible with China's unique TD-SCDMA 3G network technology.
This deal will provide China Mobile with a potential rival smartphone to Apple iPhone 5, which is expected to be launched next week in China. China Mobile is the only major operator in Chian that does not sell the iPhone.
"It is not a surprise, but it still means a giant opportunity for Nokia, maybe one of the best opportunities for its smartphones right now," Nordea Markets analyst Sami Sarkamies told Reuters. "This market has a lot of piled-up demand for high-end smartphones."
The deal with China Mobile could help Nokia regain market share where the company's sales plummeted 78 per cent on an annual basis in the third quarter, according to IDC analyst Francisco Jeronimo.
"Nokia used to be an exceptionally strong brand in China a couple of years ago, and Chinese consumers are familiar with the brand," Jeronimo told the Wall Street Journal. "The deal with China Mobile is likely to boost Nokia's performance in China, but more importantly, it will help the Windows Phone platform by making a great number of Chinese aware of it."
In April, China Telecom started selling the CDMA-capable Lumia 800C Nokia, which went on sale for around €442 without a contract. However, that device ran an older version of Microsoft's windows Phone software. The 920T for China Mobile runs the revamped Windows Phone 8.
Nokia, which has encountered fierce competition in China from local smartphone vendors after it started selling its earlier Lumia series there in the first half of the year, also unveiled the Lumia 620--its cheapest Windows Phone 8 smartphone.
The new handset will first go on sale in Asia priced at around €190, followed by launches in Europe and the Middle East. The 620, which is aimed at a more "youthful" audience, will have seven interchangeable shells in various colours, a 3.8-inch screen and is more compact than the 920 and 820 devices.
Commenting on the 620 launch, Eric Beaudet from Natixis Securities, told Reuters: "It seems they are able to lower Windows Phone prices quite quickly, quicker than most people anticipated."
Analyzing the world's 11 biggest handset makers in Q3 2012
Is the Lumia 920 a turning point in Nokia's fortunes?
Nokia's Lumia 920 LTE smartphone experiences jump in sales
Nokia's Elop: 'Special' partnership with Microsoft on track, despite worries
Report: Microsoft working on its own smartphone design
Nokia brings Windows Phone to China in bid to grow market share