Nokia pins recovery hopes on advanced camera smartphone Lumia 1020

Nokia on Thursday introduced a new smartphone, the Lumia 1020, with a powerful 41-megapixel camera in its latest bid to catch up with rivals Samsung Electronics Co Ltd and Apple Inc.

Tech bloggers responded enthusiastically, saying the camera quality was the highest in the market. But analysts questioned whether it was enough to help Nokia, suffering a fall in cash reserves after years of poor sales, survive.

“The hardware’s a beauty on this thing,” said tech website Engadget after CEO Stephen Elop demonstrated features including “floating lens” technology that adjusts for camera shake and six lenses that help produce sharper images.

The Finnish mobile phone maker is pinning its hopes for a comeback in smartphones on Microsoft Corp’s Windows Phone - an operating system that is struggling to compete with Google’s popular Android system. While regular mobile phones still account for the bulk of its shipments, smartphones are viewed as crucial for its long-term survival because of their higher margins and increasing demand for web access from mobile phones.

Jo Harlow, Nokia’s executive Vice President in charge of smart devices, said the growing popularity of photo and video sharing meant more consumers will want better cameras. “Taking pictures is in the top three things people do with a smartphone. It’s a relevant feature to be focused on,” she told Reuters. “To stand out you have to differentiate.”

The new Lumia’s 41-megapixel count far exceeds those of the iPhone 5 and Samsung Galaxy S4 Zoom, at 8 and 16 megapixels respectively. It is also higher than some compact cameras, although higher megapixels do not necessarily mean better photos as factors such as lens quality also affect the end result.

“The imaging capabilities here are extraordinary,” said Current Analysis Analyst Avi Greengart. But he added: “It’s still a Windows Phone ... if somebody is looking for applications they’re still going to look at iPhone.”