Nokia Said to Announce Plans for First Microsoft Phone for AT&T

Nokia Oyj (NOK) will unveil its first Windows Phone for AT&T Inc. (T) at the Consumer Electronics Show Jan. 9, two people familiar with the matter said, boosting an effort by Microsoft Corp. (MSFT) to regain market share lost to Apple Inc. (AAPL) and Google Inc. (GOOG)

Nokia and AT&T, the second-largest U.S. wireless carrier, will announce plans to begin selling the Nokia Ace in the coming months, said the people, who declined to be identified because the arrangements are private. The handset will be the first Windows Phone to use the next-generation wireless technology known as long term evolution, or LTE, the people said.

AT&T is set to become the biggest U.S. carrier to announce a Nokia Windows handset, underscoring the agreement’s importance to Microsoft. Nokia is working to revive sales after it lost the title of worldwide No. 1 smartphone maker to Samsung Electronics Co. (005930) in the third quarter, according to researcher Gartner Inc.

The Nokia Ace will run the newest version of the Windows Phone software, one of the people said. While the price hasn’t been finalized, the device may sell for $249 with a two-year contract, the person said.

AT&T is ahead of schedule expanding its LTE network, with service in 26 U.S. cities, John Stankey, head of business solutions at the Dallas-based company, said this week.

Smartphone Buyers

Last month, T-Mobile USA Inc. announced it would offer the Lumia 710, the first Nokia phone to run Windows Phone software in the U.S. The device, targeting first-time smartphone buyers, will cost $49.99 after a $50 rebate and with a 24-month contract. It will be available Jan. 11.

Google’s Android boosted its share of the smartphone operating-system market to more than 50 percent in the third quarter, according to Gartner, more than double its share from a year earlier.

Espoo, Finland-based Nokia has revamped its smartphone business around the Windows Phone operating system. The company began selling Lumia phones in Europe and Asia last year.

Dawn Beauparlant, a spokeswoman for Redmond, Washington- based Microsoft, declined to comment. Doug Dawson, a spokesman for Nokia, and Mark Siegel, a spokesman for AT&T, also both declined to comment.

Plans by Nokia and Microsoft to unveil the phone were reported by the Supersite for Windows blog on Dec. 29.

To contact the reporters on this story: Scott Moritz in New York at smoritz6@bloomberg.net; Dina Bass in Seattle at dbass2@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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