Microsoft is rumored to be working on three editions of Surface Phone smartphone.

The Surface line of products of Microsoft have meet with positive reception from audience and critics. Apart from launching tablets and hybrid devices like Surface, Surface Pro and Surface Book, the Redmond giant is rumored to be working on a Surface branded smartphone, Windows Central reported.

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The Windows 10 Mobile OS powered Surface Phone is rumored to arrive in three configurations that will be targeted towards customers such as general users, prosumer and business. Speculations are rife that the Surface Phone will be launched early next year.

Continuum, a feature through which a smartphone running on Windows 10 Mobile OS can be used as a full-blown desktop, is going to be one of the major features of Surface Phone. All the three models of Surface Phone are expected to carry support for Microsoft Pen technology. It will support smart ink feature that was showcased at the recently held Build 2016 event by Microsoft.

Microsoft is expected to discontinue the entire line up of Lumia smartphones after the arrival of Surface branded smartphones. Microsoft had taken over the Lumia lineup from Nokia in 2013.

One of the reasons why the Redmond giant may want to discontinue Lumia series is that it may want to allot the work of manufacturing budget phones to its OEM partners such as Blue and Alcatel. The Lumia phones are not so popular compared to other known brands in the smartphone market. Hence, with the launch of Surface Phone, Microsoft may want to enter and disrupt the market once again with newer products.

Microsoft is currently working on upgrading its Windows 10 OS for desktop. The Redmond giant had launched it last year at the end of July. Now, the company is rumored to be working on Redstone 1 and Redstone 2 updates.

The Windows 10 Redstone 1 is expected to be available as Windows 10 Anniversary Update by July this year. However, the Windows 10 Redstone 2 update will arrive by spring next year. The company is likely to showcase the upgraded OS through newer models such as Surface Pro 5 and Surface Book 2. At the same launch event, the Redmond giant is also likely to announce the Surface Phone device, Forbes reported.