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New York — Nokia revealed its first smartphones to run the next version of Windows, a big step for a company that has bet its future on an alliance with Microsoft.
Nokia's new flagship phone is the Lumia 920, which runs Windows Phone 8. The lenses on its camera shift to compensate for shaky hands, resulting in sharper images in low light and smoother video capture, Nokia said. It can also be charged without being plugged in; the user just places it on a wireless charging pod.
Nokia also unveiled a cheaper, mid-range phone, the Lumia 820. It doesn't have the special camera lenses, but it sports exchangeable backs so you can switch colors.
The Finnish company revealed the new phones in New York on Wednesday. The American market is a trendsetter, but Nokia Corp. has been nearly absent from it in the past few years. One of CEO Stephen Elop's goals is to recapture the attention of U.S. shoppers.
Facing stiff competition from Apple's iPhone and devices running on Google's Android software, Nokia has tried to stem the decline in smartphones in part through a partnership with Microsoft Corp. announced last year. It has moved away from the Symbian operating platform and has embraced Microsoft's Windows Phone software.
Nokia launched its first Windows phones late last year under the Lumia brand, as the first fruits of Elop's alliance with Microsoft. Those ran Windows Phone 7 software, which is effectively being orphaned in the new version. The older phones can't be upgraded, nor can they run applications written for Windows Phone 8.
Nokia sold 4 million Lumia phones in the second quarter, a far cry from the 26 million iPhones that Apple Inc. sold during those three months. So far, the line hasn't helped Nokia halt its sales decline: its global market share shrunk from the peak of 40 percent in 2008 to 29 percent in 2011, and it is expected to dwindle further this year.
Elop said the new phones will go on sale in the fourth quarter in "select markets." He didn't say what they would cost or which U.S. carriers would have them. AT&T Inc. and T-Mobile USA have been selling the earlier Lumia phones.
Investors weren't impressed. Nokia's stock fell 27 cents, or 9.6 percent, to $2.56 in midday trading Wednesday. It had dropped to as low as $2.41 after the announcement. Shares of Microsoft, which is based in Redmond, Wash., was unchanged at $30.39.
For Microsoft, the alliance with Nokia is its best chance to get into smartphones again, where it has been marginalized by the rise of the iPhone and then phones running Google Inc.'s Android software. The launch of Windows Phone 8 coincides roughly with the launch of Windows 8 for PCs and tablets.