Microsoft on Tuesday announced the second generation of its Nokia X2 smart phone lineup, which runs an Android-based OS and targets an emerging generation of smart phone buyers that the company describes as "the next billion." The Nokia X2 smart phones will begin rolling out globally in July and will cost just €99 (or about $135 US).

"The Nokia X family is going from strength to strength, with the Nokia X smartphone achieving top-selling status in Pakistan, Russia, Kenya and Nigeria, while earning the third-best-selling smartphone spot in India," Microsoft devices group head Timo Toikkanen claims. "The Nokia X2 elevates the Nokia X experience with a stellar new design, ease of use and new Microsoft experiences. We're proud to continue to bring smartphone innovation to lower and lower price points."

So what the heck is this thing?

Nokia controversially unveiled its first Nokia X phones in February at Mobile World Congress, months after Microsoft had agreed to buy the firm's devices and services businesses for about $7.4 billion, and just a few months before the deal was finalized. At the time, Microsoft officials admitted vaguely to being unhappy about the X lineup, though the firm has expressed public support for its heavy integration with Microsoft online services.

The issue, of course is Android. Microsoft already makes a competing mobile OS, Windows Phone, which runs perfectly well—arguably even better than—the Android-based system that Nokia chose for the X phones. (It's really an AOSP, or Android Open Source Project, based device, meaning that it does not come with Google apps or services, nor the Google Play Store for apps and media.) Many have argued correctly that the Windows Phone ecosystem is already mature enough for these devices and that starting over with a new OS, user experience, and apps ecosystem makes absolutely no sense. Plus, Windows Phone is free, so using Android/AOSP doesn't save any money either.

But common sense be damned, Microsoft is trudging ahead. Obviously, this second generation design was completed before the Microsoft acquisition, so one might argue that it's fiscally responsible to deliver them to customers. But Microsoft infamously delayed the release of its Windows RT-based Surface Mini tablet for a second time in May, and did literally days before it was to be announced; that device was manufactured and boxed, and thousands of units are sitting unsold in warehouses.

It may be years before we get a complete picture on the rationale for Nokia X. For now, we can rely only on what the firm says publicly.

The new X2 phones are of course a bit better from a specs perspective than their predecessors. They feature bigger 4.3 inch ClearBlack displays, a 5 megapixel camera, a slightly faster 1.2 GHz processor (up from 1 GHz), and 1 GB of RAM (up from 512 MB). They feature the next-generation Nokia X Software Platform 2.0, with various software enhancements, and include a hardware Home button, sorely missing in previous generation phones. They are only marginally less expensive than the original devices.

Microsoft describes the Nokia X handsets as a "gateway" to the company's online services, including OneDrive, Outlook.com and Skype, and say that they "complement" the more powerful (and Windows Phone-based) Nokia Lumia handset lineup. But many Microsoft apps and services aren't event preloaded: For example, Microsoft actually notes in a press release that X2 users can download the Bing Search app from an online store. OneNote and Yammer and likewise available from that store, but not bundled on the device.

As Nokia-designed devices, the X2 lineup is indeed both durable and gorgeous looking, and is available in multiple bright colors. (Glossy orange, black and green will be available immediately, with glossy yellow, white and matte dark gray coming later.) It comes with dual-SIM capabilities, a key concern for the targeted markets (also available in Windows Phone, just saying). While the X2 will be rolled out globally, I don't expect to see the devices for sale in the United States.