The luxury end of the mobile market has always seemed rather baffling to most mainstream users, because the rich and famous are typically offered bog standard or slightly underpowered iterations of existing handsets but with seriously over-inflated prices due to associations with fashion brands or legitimately expensive costs as a result of being studded with diamonds or swathed in crocodile skin protective pouches.

This week LG has confirmed that it is once more teaming up with Prada to work on a bespoke smartphone bearing the name of this venerable fashion house. It will be known as the LG Prada K2, or the P940 if you are a product code enthusiast. With a 1GHz processor, 4.3 inch screen and eight megapixel camera all expected to be on the cards the Prada K2 will be up there with the best of the rest of the mobile market. Product shots suggest that a sleek black shell will house this hardware, although this sentence could easily describe any of the most popular mobiles available from other manufacturers at the moment.

What is perhaps most interesting about this story is the fact that it comes in the same week as the news that Finnish firm Nokia is ditching its own luxury mobile brand Vertu. This is a company that is based in the UK and has spent its time making mobile phones which are saleable only to very wealthy clients. Taking this route has allowed it to make about £255 million a year, with a clientele that spans over 60 nations around the world.

Amongst the mobile phones it has built are models like the Constellation, which features an eight megapixel camera, 3.5 inch OLED display and a price tag of around £10,000 thanks to the jewel-encrusted exterior.

While £10,000 may sound like a lot for a smartphone, Vertu has put its name to mobiles costing upwards of a quarter of a million pounds in the past, but it looks like the luxury market must be flagging if Nokia is going to break ties with the brand.

Perhaps most strange about its business model is the fact that it has always relied on Nokia`s Symbian operating system, a platform which has come to look very outdated indeed when compared with Apple`s iOS, Google`s Android and Microsoft`s Windows Phone, the latter of which the Finnish company has now chosen for its mainstream models.

The LG Prada K2 is not going to cost much more than your typical high end smartphone, although compared to some of the HTC mobiles that are coming out in 2012 it will seem a little underpowered. But to concern yourself with the technical specifications is to miss the point of fashion phones, because they are all about image and poise rather than processor clock speed or multimedia functionality.

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