Nokia Lumia 920 Price Towers Over Galaxy S3 Upwards of 20 Percent, Loses Competitive Edge

Nokia's Windows-based Lumia 920 smartphone has an uphill battle to fight against Apple and Samsung, and at a price 25 percent higher than the popular Galaxy S III, it lacks a much needed competitive edge.

In Italy, the Lumia 920 costs 599 euros ($770), while the Galaxy S III sells for $530 euros. In Germany, the Lumia 920 costs 649 euros, as opposed to the 530 euros for a Galaxy S III. In Sweden, the Galaxy S III retails for 4,515 crowns, coming up a against a 5,700 crowns ($860) Lumia 920. Notably, Nokia has yet to announce its pricing for the U.S. market, which is still swooning over the iPhone 5 and already has a large established base of Samsung Galaxy S III owners.

While consumers may be surprised by the premium cost of the device, CSS Insight analyst Ben Wood asserts that Nokia's pricing is "exactly where one would expect it to be."

Ovum analyst Nick Dillon echoes Wood's argument, but with a caveat. "I'm sure that Nokia is pricing its new Lumias as aggressively as it can, but at the same time it needs to maintain pricing integrity." He explains that the hardware of the Nokia Lumia 920 and Samsung Galaxy S III are similar enough that consumers will not see the price hike as justified.

Expectation can weigh heavily on demand. "Windows Phone is largely an unknown to consumers - they would probably expect to pay less if they are taking a risk," says Dillon. While nothing is certain, it is clear that Nokia lacks much needed ammunition against Apple and Samsung in the impending battle for consumers' wallets this holiday season.