Mobile phone giant Nokia looks set to join the battle of the budget smartphones with news it will release its N8 model in Australia at the end of the third quarter of 2010.

A report in APCmag.com says the phone will be available in September and priced under $550.

EDIT: Just received word from Nokia Australia’s Communications Manager, Tracy Postill – the RRP for the N8 will be $AUD749. The $550 price tag is the price before tax and telco subsidy.

The Symbian OS-based phone will join Telstra’s announced LG Optimus, which goes on sale on July 1. It’s based on Android 1.6 and will sell for $504 retail.

The new N8, announced at the end of April this year, features a 3.5-inch widescreen LCD touch panel with 640×360-pixel resolution. It includes the now requisite accelerometer but also includes a compass sensor or magnetometer along with proximity and ambient light sensors.

It comes with 16GB of memory and can be expanded to 32GB through the MicroSD card slot.

The 1200mAh Lithium-ion battery is rated for 390 hours standby and will give a maximum of 12 hours’ talk time.

The N8 will also feature one of the better cameras on a smartphone with its 12-megapixel images sensor and Carl Zeiss lens. It also has a secondary VGA (640×480-pixel) camera for video calls.

Video capture is also supported up to 1280×720-pixel (720p) at up to 25fps, captured in either H.264 or MPEG-4 SP format.

The phone will support 720p video playback externally through an HDMI cable and even include Dolby Digital sound. The HDMI cable is included in the standard package. The N8 also includes a 3.5mm AV connector.

Flash video is supported as is YouTube browsing and streaming.

Audio codec support includes WMA, MP3, AAC as well as AMR-NB and WB formats.

Battery life for video playback is said to be six hours of H.264 video at 720p resolution through the HDMI cable. Video recording will see the battery last 3hrs20mins. The N8 will last up to 50 hours listening to audio.

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