Microsoft working on its own Windows Phone 8 smartphone?

Suppliers based in China have confirmed that Microsoft has been working on its own Windows Phone handset for the last four months and is ready to unleash the beast early next year.
If true, then the development of the 'Surface Phone', suggests that Microsoft isn't entirely comfortable putting all its eggs in the baskets of others.
New Nokia WinPho devices are due to arrive shortly, alongside Samsung's ATIV S and the HTC 8X and 8S.
What can Microsoft bring to the party that Nokia, Samsung and HTC can't? Who knows, but it surprised everyone with the Surface tablet (reports on which are positive, so far), and goodness knows no-one else is making WinPho sexy.
It's not then a huge leap to imagine a scenario where Microsoft has full vertical integration, like Apple. It's a brave new world, ladies and gentlemen.
Do you think Microsoft can pull off its own smartphone?

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