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Microsoft Unveils Affordable Lumia 640 and 640XL, Demos Univeral Office

BARCELONA -- With the demise of two-year contracts and the subsidies that come with them, companies are releasing more and better budget phones. Today at Mobile World Congress, Microsoft unveiled two of the most intriguing budget phones in recent memory: the 5-inch Lumia 640 and 5.7-inch Lumia 640XL, both of which are coming to the U.S. later this year on AT&T, T-Mobile and MetroPCS.

Lumia 640 and 640XL

Starting at 139 euros for the 3G model or 159 euros for the LTE version, the Lumia 640 features a full HD display, 1.2-GHz quad-core Qualcomm Snapdragon processor and 1GB of RAM. It has an 8-MP rear rear shooter and front-facing camera with an undisclosed resolution. A 2,500 mAh battery promises solid battery life.

The 5.7-inch Lumia 640XL costs a bit more, starting at 189 euros for one with 3G and 219 euros for the LTE model. It also has a 1.2-GHz Qualcomm snapdragon CPU, 1080p display and 1GB of RAM. However, it sports a higher-res, 13-MP rear camera with Zeiss optics and a larger, 3,000 mAh battery.

The Lumia 640  comes in four different colors: glossy orange, glossy cyan, glossy white and matte black. The 640XL has matte cyan, matte orange, matte black, matte white and glossy white. The matte cyan and glossy orange looked particularly attractive when we saw them up close.

Both phones will launch with Windows Phone 8.1 but then receive an OTA update to Windows 10 when it is ready later in the year. They also come with a free one-year subscription to Office 365 that users can share with their tablets or PCs. The devices are also bundled with 1TB of OneDrive storage and 60 minutes per month of Skype Unlimited Worldwide Calling.

MORE: Windows Phone 8.1 Review - Laptop Mag

Folding Keyboard

Microsoft also announced a folding Bluetooth keyboard that's designed to work with any phone or tablet. We had a chance to touch the keys and noticed that they felt identical to the snappy, but somewhat shallow keys on the Surface Type Cover. The keyboard easily folds in half and snaps closed with a magnet. There was no word on pricing at press time.

Universal Apps and Cloud Integration

During its Mobile World Congress press conference, Microsoft executives also showed off some of the features of Windows 10 and its universal apps, using a variety of Lumia phones and Surface devices.

Company reps showed off an early beta of its Project Spartan browser for mobile. In addition to its lightweight UI, the browser has a special reading mode that strips extraneous navigation and content (including ads) from web pages so you can focus on the text and images. There's also a way to save web articles on your PC for later reading on the phone.

We were also treated to some demos of the new universal app version of Microsoft Office. An executive showed how the phone version of Outlook has a number of features previously reserved for the desktop, including the ability to format text using the Word editing engine. The touch-friendly version of Excel ran flawlessly on a Lumia phone, showing a number of columns with full formatting and a dynamic table.

The universal apps version of Word shows content in columns when it appears on a widescreen tablet and allows users to highlight a word in order to get more information about it. When querying the word "shutter" on a cameras article, information from Bing populated a side panel next to the document. There's also a new "tell me" feature that allows users to find complicated functions without digging through the application menus. When an exec typed in "make a table," the tell me feature inserted a table, rather than just explaining how to create tables as Word help does today.

Outlook

Though the prices for both Lumia phones were presented in euros, we can expect them to be similarly inexpensive when they come to the U.S. With attractive phone designs and the Windows 10 experience that brings you the same powerful apps on both your handset and your PC, Microsoft is making a very compelling case for its platform.