Microsoft does indeed have their own Windows Phone in the works

(Concept Surface phone by YrOnimuS)

Rum: 9

Yesterday we wrote a fairly lengthy article about a new rumor of a Microsoft Windows Phone. The source came via China Times and we were hesitant to believe the claim—after all, no evidence or sources were mentioned.

Still, we pointed out that Microsoft is a large company with a ton of resources. If they wanted to do a phone, they most certainly could pull it off and the Surface Tablets only reinforce the notion that they can do this in secret.

So what has changed? Information has come forward to Windows Phone Central that demonstrates Microsoft does have their own Windows Phone hardware in the works; in fact, we’ve heard it already exists and is in testing. The source(s) are known to us and not anonymous, though for obvious reasons we must keep them off the record.

Details about what it looks like, hardware specifications, launch times, etc. have not been shared with us by the person(s) who have provided the information. The only thing we do know is when compared to current WP8 hardware it’s something unique.

Something awry between Microsoft and Nokia?

Why is Microsoft doing this?

We speculated yesterday on two possible angles for Microsoft doing their own phone.

One was the Google-Nexus route of selling their own hardware, direct to customers with no carrier interference. Sold through Microsoft Store (opens in new tab), the devices could fill in a niche for Microsoft while their OEM partners can have the carriers. This would allow Microsoft to have their own "vision" of Windows Phone and a way to update the devices directly, with no one compromising their vision. In addition, their OEMs will mostly be kept "happy" since unlocked phones are not the crux of their business model.

The other reason we raised was Microsoft maybe wanted a contingency plan—in case the Windows Phone 8 launch doesn’t go well and the currently announced devices don’t catch on. Nokia could be in trouble financially and Microsoft would need another dedicated hardware partner.

A third possibility we've been hearing about for a weeks is tougher to swallow. We have heard rumblings about Nokia focusing too much on the “Lumia” brand as opposed to Windows Phone, which may explain why Microsoft put HTC on a pedestal with the “signature” Windows Phone banter a few weeks ago in New York City.

Interestingly, just ran a story where they too are confirming a Microsoft Windows Phone. They note they learned about it weeks ago and our sources appear to be different from theirs (our info came this morning). They do note that it is a “high end” phone but it will not launch with the 1st wave of Windows Phone 8 devices.

Microsoft Studio C

Microsoft on Lockdown

In an interesting and perhaps related story, the reputable site GeekWire is reporting that areas of the Microsoft campus have substantially beefed up security in recent weeks:

“The company notified employees this week that it will be implementing new physical security measures — limiting employee access at four key Xbox and Interactive Entertainment Business buildings to ensure confidentiality of upcoming products.”“The changes will affect Microsoft Studios A, B, C, and D, on the west side of state Route 520, starting early next month with Studio A and rolling out to the other buildings by the end of the month.”

GeekWire is rightly claiming this is most likely related to next-gen Xbox console testing, but from our own knowledge Microsoft has some Windows Phone "things" happening in Building C too.

With a Microsoft branded Windows Phone entering into late stages of development, it would make sense that much like the Surface tablets, they would begin to implement tighter security around campus.

Daniel Rubino

Daniel Rubino is the Editor-in-chief of Windows Central, head reviewer, podcast co-host, and analyst. He has been here covering Microsoft since 2007 when this site was called WMExperts (and later Windows Phone Central). His interests include Windows, Microsoft Surface, laptops, next-gen computing, and for some reason, watches. Before all this tech stuff, he worked on a Ph.D. in linguistics and ran the projectors at movie theaters, which has done absolutely nothing for his career.

  • it will be interesting to see the 2nd generation Lumia pitted against a Surface phone
  • +1
  • I had pretty much convinced myself to wait until spring for a new Windows Phone even though i can upgrade in November. With this news, I'm definitely waiting, but not TOO long. This phone might take a while. I guess I'll wait until MWC 2013 in February and then make a decision.
  • That's the bad thing about smartphones the best is always next lol
  • Indeed it will. I can't wait to see what this beast of a phone will look like. If the Surface tablets are anything to go by, then I know we won't be disappointed.
  • Even if a MS Phone really were in the works, it wouldn't surface untill late 2013 with WP 8.5 against 3rd generation Lumias.
  • Wouldn't "surface"? Tee Hee Hee
  • I don't know if there's indeed going to be a Surface Phone or what.  What I do think is that Microsoft have definitely built a phone.  Why wouldn't you?  If you needed a contingency to bump awareness of Windows Phones, why not build a protoype at the very least before the time comes where you might need something to really kick up the excellent, but still not well-known and widely-used mobile operating system.  I'd be VERY interested in having a look at a WP8 device from Microsoft.  However I do question how well they could compete with Nokia.  Nokia's Lumia 920 is excellent and offers such a superb camera and cool extra features that Microsoft would really have a huge friendly competition with their only exclusive OEM.  Not to say Microsoft couldn't make it happen, but boy do they need to impress if they do drop a phone in 2013.
    There is a special announcement coming on the 29th of January.  Maybe that has something to do with this?  Speculation is both fun and terrible.  I won't totally buy into rumors of this device seeing a release until Microsoft say it themselves.
  • Perhaps the 2nd generation Lumia is the Surface phone. Think about that for a moment :)
  • Intresting
  • Yes it is. Maybe Microsoft is doing this so all carriers can have a top notch phone. Microsoft's phones might have all frequencies and come in GSM/CDMA Flavor. If Microsoft sold these phones un subsidized everyone on every carrier could have access to W8 and updates immediately as there released.
  • I agree the exclusive phone deals suck.L920 should have been offered to all carriers like they did the L820.
  • Great news Nokia is what Lexus is to Toyota. Lumia brand is on another level your not just buying a Windows Phone your buying a Nokia Windows Phone.
  • Lolwat? Bankrupt Nokia is the Lexus of phones? You best be trollan.
  • No, he is using the relationship of Lexus and Toyota as a comparison to Nokia and Microsoft. Although MS and Nokia are two separate companies, they both use the same OS to make a phone, just like Toyota and Lexus use the same technology/bodies to make cars. Nokia is the more classier version of Windows Phones, while Microsoft will make more affordable yet equally (in some cases) capable. 
  • We'll see. When I was in sales at at&t I stopped selling Lumias altogether right at the end. Too many problems with the phone that aggravated ordinary customers. Data still dropping even after the sotware fix was issued, battery running down too quickly, random reboots...and keep in mind I was the Windows Phone Guy. It really tarnished the 900's image in my eyes. Plus it didn't feel premium like my 800. No curved glass, and the somewhat sharp edge that it had where the glass met the polycarbonate was uncomfortable when you held the phone to your ear. Glad the 920 will be here soon though. Now the 800...that was a solid phone. Shame it had a Pentile screen and won't get WP8.
  • no America is bankrupted as they are writing bogus checks and buying with bogus money, Nokia got some cash and every day is making deals with their location services, I wouldn’t be surprised if even apple came aboard, the only reason nokia looks bad is because of American media, and American arrogance, America thinking that if a phone doesn’t sell here then it don’t count, that’s also the reason more and more movies are being released overseas first. We’re becoming irrelevant because of our media, and weak economy. Nokia has the best phone and apple the worst but it doesn’t matter but good for nokia people overseas don’t listen to or buy what our media tell them to they buy for a reason that we long forgot, cause its good, maybe even the best.
  • Put down the crack pipe.
  • No crack pipe necessary.  All U.S. citizens are endentured servants.  All are put on as collatoral for the MASSIVE U.S. debt.  I'll give my money to Nokia for sure.
  • It's citizens are "indentured servants" because they are under educated and can't spell words like "indentured" and "collateral" correctly or are too lazy to use a spellchecker as you have so adeptly demonstrated.
  • I agree with ya jbrandonf .... we are far from bankrupt and obiviously this is someone not understanding how the world works...
  • To be honest, we europeans couldn't care less about silly America. It's a good laugh.
  • cannot agree more... once Americans said that the phone is no good then should the rest of the world listen???
    Well, I guess not! Lumia 920 is above all the rest.... Nokia FTW
  • Wow how much does Nokia charge for a comment like that?
  • Christ, you're a fucking idiot.
  • How much does Google pay you for a comment like That? -_-
  • Two words: Apple envy.
  • Another two words: Why not?
  • Totally agree.  Apple makes more money -- without holding a dominant market position in any major area in which they compete -- than MS does with their monopoly.
    Clearly Apple have changed the game.  Other companies would be wise to emulate them.
  • By emulate apple, your advising all companies to charge 3x the price for a technically inferior product? That's dumb.
  • What of theirs is 3x the price? The air is about the same price as other ultrabooks and beats all of them as windows pcs. Their phone is $200 like every other phone. Can you name something that's technically inferior about them, instead sounding like a mindless fanboy.
  • haha...  you just said what i've thought for a while - that Mac's run Windows beautifully... tried to find an oem Windows machine that had the specific componentry necessary for sound production and could NOT find one so instead dipped my toes in with a MBP.  Nice machine - runs Windows fine... you get used to the keyboard after a while.
  • First off the spec's on a MBP are way lower than a comparable equiped Ultra.  Second the $200 is for 16GB, in most other phones you get more or can add an SD.   Technically inferior?  Let's start with the glass on the iPhones.  My clients have broken more iPhone glass than all the other phones combined.  I have clients with all sorts of phones and the iPhone is not in the majority.  Then there is the aliminium case that dents.  My plastice (yes plastic) case is virtually uncrackable and will NOT dent.  Now lets delve in to the price issue.  A totally tricked PC Desktop/Workstation is about $2G's, a comparable Mac Pro is about $3500/$4000, not 3x but 2x.  Laptops are about 2x as well.  Hey, don't take this the wrong way, I have plenty of Mac's/AppleTV/iPxds areound but I know I am paying a premium to be an appleoid.
  • I actually agree with you, but the iPhone is 100$ more expensive than the Lumia 920 (100$) here in Canada. Nokia needs to undercut Apple at this point, whereas Apple can enjoy a higher profit margin, which means it's more expensive for what you get.
  • Well the obviously being technically inferior doesn't matter. It's about the experience baby, not the specs. I'm happy for Apple and their success, they found a solid strategy and worked it. Now Nokia has to find theirs.
  • Why wouldn't you have Apple envy? Their profit margins are insane. You should be rooting for competition. If there is enough competition, Apple will have to reduce their margins and you will be able to buy whichever phone you prefer for less money.
  • Time for Nokia to get cozy with the Jolla boys! Typical MS, always find a way to screw companies that partner with them.
    Does this give Nokia an out of their contract and allow them to go android or any other OS?
  • Nokia is probably subcontracted
  • +1
  • I think this statement is ridiculous.  Because Microsoft makes their own device, Nokia should go with Jolla, or worse, Android?  Nokia isn't the sole oem for WP in case you didn't notice.   It would be naive to think that Nokia (or the other oems) weren't aware of Microsoft's plan to make their own device.
    Microsoft needs Nokia, if for nothing else but for Navteq; and no way can Microsoft 'out innovate' Nokia on hardware.  Nokia has nothing to be concerned about - Lumia will still be synonomous with WP even after Microsoft releases this device.
  • +1 Exactly. Everyone is acting as if public news is how major companies get their info. Nokia obviously knew about this.
  • I'm not convinced Nokia or the other OEMs knew about this. Not everything is shared.
  • plus nokia has alot of reach worldwide, which MS doesnt have actually thats why ZUNE failed not that it was a bad product or something but it was limited to a few regions. Even for WP,  when nokia came onboard only then was WP launched in regions like india, china and still many software features of WP are not available in those countries like artist on lockscreen, local scout, music marketplace, etc.
    and i have the same feeling about the surface PC let alone the surface phone that these products wont launch in countries other than US, Canada n some countries in Europe 
  • You miss the point, with MS in the game, just like the Surface tablets there is even less of a market for Nokia and as WP is their sole smartphone OS it will be smart to look at alternatives. HTC and Samsung, even Huawei have android to fall back on, if Nokia doesnt make it with WP they are gone. Having a competitive OS like android as a secondary option would be better than nothing.
    And I would argue that it would make no sense for them to sign on exclusively with WP if they knew MS was going to enter the market as well, if this comes to light the first thing that would be hit would be their stock price, then pressure on Elop to be replaced as the perception would be that Nokia could not compete with MS, HTC, Samsung and any other WP OEM. If they knew this and signed on anyway they only have themselves to blame because I cant see this being in any way good news for Nokia as a company.
  • I have to agree with this.
  • You're assuming WP marketshare stays the same. If it does, than MS entering the market will reduce Nokia sales. If the devices from Nokia, HTC and MS make wp more desirable and increase the apps in the ecosystem, then the marketshare will increase and all teh wp oem will do better. I know there are a lot of if's in this statement, but that is the theory.
  • Fortunately market share had nearly doubled in Europe year over year, which is Nokia's largest market anyway, anything in the US is just a bonus.
  • To be honest I don't see the problem at all. Their OEM partners seems to be on a yearly or maybe 9 month release schedule, and if Microsoft launches their phone in the middle of this cycle it won't really be an issue. The amount people that will know about this phone in advance and are willing to wait for it isn't really that big. The only phone that has that power is the Iphone. I would also love a phone that differentiates from the Nokia/HTC design to attract a wider audience, not to mention I would love it if it was made from something else then plastic.