Nokia opens ethics investigation into misleading Windows Phone launch

Finnish company's Lumia 920 faked video and photo problems get worse.

UPDATE Sept 11: Nokia has opened an ethics investigation into the use of faked photos and video at its Lumia 920 smartphone launch, according to a Bloomberg reprt.

Nokia says its inhouse ethics officer will conduct a review into why the company published misleading marketing 

An independent report will seek to “to understand what happened,” Susan Sheehan, a Nokia spokeswoman, told Bloomberg.

Following behind-the-scenes photos published by Hacker News over the weekend, Nokia broadened its apology for the September 7 (Sept 6 NZT) demo of its Lumia 920 - which will be its first smartphone to run on Microsoft Windows Phone 8 software.

The company has admitted images used as examples of the Lumia 920's photo and video abilities were not actually taken on a Lumia 920.

The scandal is keenly felt by Nokia, which is banking on the Lumia series to regain ground lost to iPhone and Android. The Finnish company's shares [NYSE:NOK] dived 16% on September 7, and were down 0.38% in late trading today.

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Nokia expands apology for faked video to cover faked photos too

UPDATE Sept 10: Nokia has expanded it apology for "simulating" - or more bluntly, fakiing elements of it launch for the Lumia 920.

On September 6, the company posted a blog called "An apology is due," admitting that video supposedly taken on the 920 had been simulated.

Now, in an email to Mashable, the Finnish phone maker has admitted photos used at the event were "simulated" as well. Neither the photos nor the video was taken on a 920.

Nokia was forced into the admission after a Hacker News posted a wideshot photo that revealed a host of sophisticated gear surrounding a woman photographed to demonstrate the Lumia 920's PureView floating lens optical image stabilisation (OIS) technology, which the company says reduces blur in low light situations and makes for smoother pictures.

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Nokia's new Windows phone gets thumbs up from fanboys, big thumbs down from investors

Sept 6: Nokia shares [NYSE:NOK] plunged 16% today as the company previewed its Lumia 920 - one of the first phones to run on Microsoft's Windows Phone 8 software (due October 26).

Tech writers were impressed by the 920, whose feature includes wireless charging, a 4.5-inch display (the iPhone is 3.5-inch), 4G support, and an 8.7 megapixel "PureView" camera with a highend Carl Zeiss lens. And Microsoft's Windows Phone 8 software has received solid notices from critics. The new OS will be a close relative to the tablet and PC versions of Windows 8, making it easy for software makers to port one app between the three platforms - something that should help chase down Apple and Google Android's advantage in apps.

But it wasn't enough to reassure Nokia's long-suffering investors, many of whom seemed to think the launch was the company's last-best hope - and that the 920 just didn't have what it takes to turn the company around. Nokia's silence on release dates didn't help.

The Lumia 920 was unveiled in New York earlier today. Nokia used the same event to preview a step-down model, the Lumia 820.The 820 also supports wireless charging, but only as an optional add-on.

Although Lumia sales have been steadily rising, they are still the single digit millions per quarter, against 26 million iPhones sold last quarter by Apple, which in turn trails smartphone sales by those in the Google Android camp.

Nokia will face more pressure on September 12 (September 13 NZ time) when Apple stages a major product launch, widely assumed to be for a new iPhone with a larger display.

In late NYSE trading Nokia's US-listed shares were changing hands at $US2.38.

Before the release of the first iPhone, in 2008, they traded as high as $US56.

At first blush, investors seem to have been harsh on Nokia today.

Lumia sales have been growing, if not as fast as some would like, and the 920's wireless charging feature (used via a charging pillow, plate or stand) does provide a standout selling feature.

Wireless charging is not new. Third-party phone shells and pads have been around for a while. But having a model-specific series of charges is a new development. And it's one that could be keenly appreciated by smartphone owners suffering under an ABC (Always Be Charging) lifestyle.

Other features, such as the high-end video and still camera, and Photosynth software for stitching together a panorama, are not so unique, but seem very elegantly implemented.

Nokia is also pushing a "it's not just about the megapixels" argument (sensible the iPhone 4S and high-end Androids already have 8 megapixel camera). In New York, the company demonstrated the Lumia 920's optical image stabilisation (OIS) technology, it says eliminates blurry images and improves pictures shot in low light conditions. But the company later apologised and revealed "OIS" footage displayed at the demo was not actually taken on a 920, but rather a "simulation" of OIS technology.

If the mapping and music streaming features are included in the the 920's NZ release, this will definitely be a smartphone worthy checking out - especially for those using Windows and Microsoft Office on their PC.

Local pricing and availability will be announced later this year, Nokia NZ says.

See full Lumia 920 tech specs here.

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