Much like the Nokia Lumia 620 reviewed yesterday, the benefits of off-the-shelf hardware, with a lean operating system that does not demand the earth in terms of specifications, gives Windows Phone an advantage in these more competitive markets.
To be fair, having Microsoft impose a baseline specification that must be reached (or exceeded) is having a positive effect on the hardware available. Nothing is underpowered in terms of CPU or GPU, nor in peripherals. The only issue is the limiting factor of 4GB of internal storage. It might be enough to run the first-party applications, but it's a huge limiting factor if you start to download more than a few third party apps from the Windows Store.
You can find out more about O2's deals on the Ascend W1 here.