Microsoft announces £15 phone without data connectivity

Microsoft has unveiled the Nokia 130, a low-end phone that doesn't include a data connection and will be sold for 19 Euros (15) in a bid to tempt budget-conscious buyers, according to the BBC.

A separate report by BGR recently suggested that Microsoft was working on abandoning phones on the lower end of the pricing scale altogether, but this move suggests that they may actually intend to fill a gap in the market they say other companies aren't taking advantage of.

Jo Harlow, head of the company's phones business, told the BBC: "This is a massive market segment, and there are not a lot of players in this segment for the reason that scale is really important.

"We have the distribution and supply chain scale to compete effectively in this market. This is a space where smartphones today don't reach, so there [are] still very strong benefits to our business."

The phone will be targeted at those earning less and who are looking for a lower-cost device without all of the bells and whistles, and will be sold alongside other handsets running the Series 30+ operating system.

Microsoft insists that the company still stands to profit from the handset despite the low cost.

The Asha and Nokia X handsets, which Microsoft has confirmed they will be phasing out to make way for the pricier Windows Phone range, are thought to have been eclipsed by Android's own low-end options.

Ben Wood from CCS Insight commented on Microsoft's plans for the Nokia 130, saying: "Microsoft will have done a business case for the new phone, and it knows that it is one of the top players in terms of volume in the feature phone' space.

"The problem with Asha and X phone was that they were cannibalised completely by low-cost Android. Microsoft may only make tiny amounts of money per Nokia 130 device, but you have to look at the volume, which is millions and millions of units."