The Nokia N91 multimedia handset comes with a 4-gigabyte hard disk, allowing users to store up to 3,000 CD-quality songs on their phone, Nokia says.

Nokia expects to become the largest seller of portable MP3 players this year.

It also claims to have outstripped camera manufacturers with the sale of camera phones.

Tesco Value

Determined to compete in the photography arena, Nokia has launched the N90, a mobile that comes with a 2 megapixel camera, autofocus, 20x digital zoom and optics designed by Carl Zeiss, a trusted photography brand.

"With its pioneering multi-hinge twist-and-shoot design, we have brought ease-of-use and high quality photography into mobile telephony," said Juha Putkiranta, senior vice president of multimedia imaging at Nokia.

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The phone is expected to go on sale in the summer, with the N91 making its debut at the end of the year.

For Ben Wood, principal analyst at research firm Gartner, the new ranges suggest a change of direction for Nokia.

"In the high-end aspirational part of the market, Samsung and Motorola have stolen a march. The Nokia brand has not got that lustre and Nokia does not want to become the Tesco Value product of the mobile world," he said.

Compromise of convergence

With its latest camera phone, Nokia has acknowledged that people want a bit more quality from the snaps they take with their mobile.

But it will be a while before people consider using the cameras on their phones for the cherished photos they take on holiday or at events such as birthdays and weddings, Mr Wood thinks.

He also suspects Nokia will find it hard to compete with Apple and other digital music player makers.

"All the mobile manufacturers are chasing after the music market but it will be a challenge to compete with Apple because the iPod is such an iconic design," Mr Wood said.

Music phones are more likely to compete with cheaper, flash-memory based music players, he thinks.

"Nokia is saying that this device means users won't need a separate digital music player but there is always a compromise with converged devices," he said.

"It is all very well to say camera phones are outselling digital cameras and MP3 players but people who buy them are not necessarily going to download music or take pictures."

It is a view with which digital music player maker Creative agrees.

"I'm not sure that this represents competition for us," said a spokesman.

"It is endemic of the trend to integrate devices that you lose quality. Separate, dedicated devices are always going to be better," he said.