Software giant Microsoft has silenced rumours of the demise of both its feature phone efforts and of the Nokia handset brand by launching the Nokia 2015 feature phone aimed at developing markets and priced at a mere $29.

It had been widely feared that Microsoft wouldn’t bother continuing the feature phone operation it acquired with Nokia devices, preferring instead to focus on the smartphones running its Windows Phone platform. This sense was reinforced when Microsoft prematurely ditched the Nokia brand from its Lumia smartphones and failed to launch and other feature phone in the eight months since the Nokia acquisition completed.

This always seemed like a bad idea. Despite its smartphone struggles Nokia was still the largest feature phone vendor by quite some way and the only major one still putting much effort into that market. While feature phones offer little margin themselves, there remain the primary way of getting online for millions of people in developing economies. In apparent acknowledgement of this Microsoft has even retained Nokia’s “connecting the next billion people” strapline.

It also seemed like a bad idea for Microsoft to totally ditch the Nokia brand, as it remains a strong one for handsets and certainly holds more appeal in that context than Microsoft. So the handset strategy is coming into focus now: Lumia branded Windows Phone smartphones and Nokia branded feature phones running the old Series 30 platform.

The main reason for assuming Microsoft wasn’t going to bother with feature phones was its announcement last summer that was ditching the Asha brand and the Series 40 platform. In retrospect, with Microsoft pushing Lumia smartphones below $100, it seems it just wanted to create a clear divide between handset categories.

This move also adds further weight to the sense that Microsoft is refocusing on mobile software and services, regardless of the platform. It’s clearly not going to make significant money from Windows Phone licenses so its best option is to generate a large mobile installed base to which it can then sell other products.

“With our ultra-affordable mobile phones and digital services, we see an inspiring opportunity to connect the next billion people to the Internet for the first time,” said Jo Harlow, corporate vice president of Microsoft Devices Group. “The Nokia 215 is perfect for people looking for their first mobile device, or those wanting to upgrade to enjoy affordable digital and social media services, like Facebook and Messenger.”