Nokia’s Lumia phones: The good, the bad and no ugly

During the Wednesday keynote speech at the annual Nokia World(s nok) conference in London, Nokia unveiled six new handsets that will help define the company going forward. Four devices are low-cost, but feature-packed, phones running the S40 platform, which are targeted at emerging markets. The remaining two run Windows Phone, the direct result of Nokia’s long-term partnership with Microsoft(s msft).

Grading the news

Overall, the handset news was mostly expected and generally what I foreshadowed one day before the event. That’s both good and bad, however. One one hand, it shows Nokia is again capable of doing what it planned to do. In eight months, the company has made excellent progress on its shift from Symbian to Windows Phone, and it will deliver the new devices to a few markets in time for the holiday season; specifically the Europe and Asia-Pacific markets, as predicted. From this perspective, I have to give Nokia an “A.”

On the other hand — and maybe this is because of leaked information during the transition — there weren’t many surprises in the news. I’d even take it a step further and say there was no “wow” factor, but again, that could be due to prior leaks on the hardware. Additionally, we’ve seen the Mango software version of Windows Phone for at least three months, so from a software perspective, it’s mostly old news. In this respect, I’ll give Nokia a “B-.”

What’s included and what’s missing

Along the lines of software, there are three Windows Phone exclusives to the pair of new Nokia devices; the Lumia 710 and 800. These includes Nokia Drive, a navigation app with turn-by-turn directions and offline maps. Also on the phone is Nokia Music with a feature called Mix Radio that provides pre-set music mixes. Lastly is ESPN Sports Hub(s dis), a multi-sport news center exclusive to Nokia.

While this trio of software features adds appeal to Nokia’s new smartphones, I had expected a greater level of Nokia feature integration in Windows Phone. That impression came from the Nokia-Microsoft deal as both companies alluded to deeper software collaboration. Perhaps this will change in time, but from a software perspective, other Windows Phone makers should still compete well with the new Lumias, even without the Nokia software exclusives.

On the hardware front, however, Nokia does have an advantage over competing Windows Phone devices. As I’ve said many times before, Nokia has always made stunning, well-designed, high quality hardware. I haven’t seen the Lumia 710 yet, but the Lumia 800 is essentially the same hardware as the Nokia N9, which I have used. It’s arguably one of the most stylish and well-built phones I’ve ever used. The N9, however, has something the new 800 doesn’t: a front-facing camera.

I think that’s a glaring oversight, mainly from a philosophical standpoint, for two reasons. First, Nokia has a long history of engineering front-facing cameras in its phones, having done so for several years. The second reason revolves around Microsoft’s recent purchase of Skype. Here too, Nokia has expertise; the N900 handset with Maemo offered excellent Skype integration at the platform level when I used it in late 2009.

I expected Nokia would have lent that expertise to Microsoft so the new devices would be further differentiated with a front camera and Skype integration. The lack of a camera isn’t likely to hurt sales in a meaningful way. However, it’s a symbolic gap and could cause some to think Nokia isn’t leading the pack in terms of mobile technology. According to Mary Jo Foley, Nokia says there wasn’t enough time to add the camera. Given that the N9 is nearly identical to the 800, it sounds less like a hardware constraint and more of a software challenge.

Which comes out better: Microsoft or Nokia?

Overall, Nokia has made great progress this year as it migrates to a new platform. The work isn’t done yet, and we’ll see how sales go as the distribution channels widen over the next six months. Based on the news, however, it seems that Microsoft is getting the better end of the bargain with Nokia. With Nokia’s distribution channel, the new Lumia phones can help Microsoft pick up market share as Research In Motion’s (s rimm) is flagging. More Windows Phone sales could entice more third-party developers to build apps for the platform.

Additionally, the debut of well-built Nokia hardware running Microsoft’s platform could raise the bar for other Microsoft handset partners such as Samsung, LG, HTC and others. If that happens, the entire platform of devices could become more attractive to consumers and Microsoft again has the potential to gain market share. Certainly Nokia has much to gain here — it basically bet the future of the company on Microsoft’s platform — but for now, at least, the “Micro-kia” deal looks even better for Microsoft.