Nokia said the one-megapixel camera handset, dubbed the 7610, will retail for around 500 euros ($616.8) and be available in the second quarter of 2004.

Demand for camera phones has surged, especially in mature handset markets like Europe where people are looking to upgrade to new models with fancier features, such as the ability to take sharper pictures.

Nokia rival Sony Ericsson said last week some 30 percent of all phones sold globally in 2004 would have a built-in camera, and launched its own higher-resolution 1.3-megapixel model due out in Europe in the fourth quarter of 2004.