Sources have told Windows Central that Microsoft is working on a Surface Phone and it plans on introducing the handset in the second half of 2016. Plans for an all-metal Windows 10 Mobile phone that was going to use an Intel chip have reportedly been left behind. Microsoft has also moved the project from the Nokia team to the Surface team that's run by Panos Panay.

Due to the individual now overseeing the project, some sources claim the phone is being referred to as the Panos Phone. Prototype testing for the device is said to be occurring in the Microsoft campus in Redmond, Washington.

Intel is still very much involved in the project and it has been rumored the phone could use one of Intel's x86 chipsets.