Microsoft lures China with PDA, smartphone software

BEIJING: Software giant Microsoft Corp launched a new version of its personal

digital assistant (PDA) software in China on Tuesday in its latest effort to

grab a corner of the world's biggest wireless market.

Microsoft launched a version of its combined operating system, user interface

and application software package designed for PDAs -- called Pocket PC 2002 --

using the simplified form of Chinese characters used in mainland China. At least

nine foreign and Chinese PDA makers have agreed to use the software in high-end

PDAs, Microsoft said in a statement.

But a key reason Microsoft is introducing the technology in China, where PDAs

have not caught on, is that the software may eventually power smartphones and

wireless PDAs, said Roberto Cazzaro, director of international strategy for

Microsoft's mobile unit.

"The wireless market in China is a very important market, but today it's

mostly voice," Cazzaro said at the sidelines of a ceremony launching the

software. Although China is the world's biggest cellular market, its 156 million

subscribers use voice-only service, with carriers planning to introduce data

services later this year or next year.

Microsoft was in talks with China's cellular carriers Cazzaro said, adding

the carriers "want to do their homework first".

Wireless operators in the United States, including Cingular, Sprint PCS

Group, Verizon Communications and VoiceStream, have already said they will begin

marketing smartphone and wireless devices using the Pocket PC software to their

subscribers.

The relatively high price of the devices that use Pocket PC compared to the

low-end PDAs made and sold in China and using other software will be a challenge

for Microsoft, Cazzaro said. "If you have a $500 device and a $100 device,

people will start to wonder if we really have that much more to offer. And we

do, but we have to show them that," he said.

The average price of devices using Pocket PC in the United States was $350 to

$600, he said. "Price is definitely an issue much more so in China than in

other places," he said.

Firms that will use the new software on their products include Acer Inc,

Compaq Computer Corp and Legend Group Ltd., China's top PC maker, Microsoft said

in a statement. Legend announced plans to make and sell cellphones in China

earlier this year.