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Microsoft's Pocket Friendly $25 Phone for Asia and Africa

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Software maker Microsoft Corporation (MSFT) unveiled a new ultra affordable Nokia (NOK) mobile phone, Nokia 130, intended for the entry-level market. The Nokia 130 will be priced at $25 and will be available in the third quarter in different markets, including China, Egypt, India, Indonesia, Kenya, Nigeria, the Philippines and Vietnam.

The latest move will help Microsoft broaden its footprint in the fast-growing entry-level mobile phone market. It will help the software maker target first-time smartphone buyers globally. The Nokia 130 handset runs Nokia OS and consists of features like in-built video player, music player, flashlight, FM radio, USB charging and has excellent battery life.

In April, Microsoft closed the acquisition of Nokia’s Devices & Services Business, now named Microsoft Mobile Oy. It has been a leader in creating the Lumia line of smartphones that run on Microsoft's Windows Phone operating system.

In the fourth quarter of fiscal 2014, Nokia contributed 1% of Microsoft’s total revenue of $23.38 billion, which was up 14.6% sequentially and 17.5% from last year.

Microsoft is trying to increase its market share in the global smartphone market as Windows Phone still has a very tiny market share in comparison to Apple’s (AAPL) iOS and Google’s (GOOGL) Android mobile platforms. It is also targeting other fast-growing segments like wearables, cloud-computing and productivity software, as the software developer goes from a “devices and services” company to a “cloud-first mobile-first” one.

With this Microsoft’s services and technology will reach a larger number of devices across the existing PC and mobile platforms, as well as emerging platforms.

Microsoft shares carry a Zacks Rank #3 (Hold).

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