Nokia Lumia 800 costs £400 on pay as you go

The Nokia Lumia 800 will cost £400 on pay as you go with Three. The first Nokia Windows Phone is already on sale with a contract, but is expected on pay as you go and SIM-free soon from Orange and Vodafone and other retailers.

Although contract deals for the Lumia were confirmed by assorted networks, SIM-free prices were still unclear. Carphone Warehouse bandied about the figure of £450, while Nokia itself offered only links to contract deals.

A pay as you go option has been added, although only Three's link is live and that doesn't yet allow you to order the phone -- but it does at least reveal the price. Still no word though on the Lumia 710, expected next year.

The £400 price pits the Lumia against the older iPhone 4 and Samsung Galaxy S2, which cost roughly the same without a contract, while the iPhone 4S starts at £500 SIM-free. But the Lumia is available for free on most contracts, which the S2 and the iPhone most certainly are not.

Nokia and the networks will be hoping customers sign up based on the low up-front cost, as well as inducements such as a free Xbox from Orange.

It's in Nokia's interest to keep prices realistic, as it attempts to crowbar its way back into the smart phone market. Meanwhile Microsoft wants Nokia to shift as many units as possible, as Nokia's Windows Phones represent the biggest potential for the operating system to expand beyond its current small market.

Buying a phone without a SIM card and network contract is generally the cheapest way to own a smart phone. It requires an eye-watering upfront cost of buying the phone, but in the long term you'll save a tonne of cash by getting a cheap SIM-only deal, rather than being tied into an exorbitant, lengthy contract.

The Nokia Lumia 800 is on sale now and arrives in shops on 16 November. How does the Lumia's price stack up against its smart phone rivals? Tell us your thoughts in the comments below or on our Facebook page.