Major mobile firms link with Microsoft

Lucas van Grinsven

LONDON: All major mobile operators in Europe and the United States will

launch cellphones and other wireless devices in the coming year working on

Microsoft software, sources close to the company said on Tuesday.

The deals to sell Microsoft's PocketPC Phone Edition and SmartPhone software

means that its strategy to focus on telecom carriers is paying off. Microsoft

chose to target the carriers after it found last year that hardly any of the

major cellphone makers wanted to use its software.

Some 390 million mobile phones were sold last year, compared with 13 million

handheld computers or PDAs. Microsoft already has many PDA partners, but needs

the operators to get a foot in the door of the vastly larger cellphone market to

deliver on its mobile ambitions.

"All major operators in the US and Europe will bring out Microsoft-based

devices within the next 12 months," one source said.

Redmond Washington-based Microsoft has found allies in operators which want

to be able to design their own products, and be less dependent on handset

manufacturers.

Cellphone leaders Nokia, Sony Ericsson, Siemens and Motorola have selected

mobile software from Microsoft’s British rival Symbian to make smarter phones.

Symbian is jointly owned by these cellphone makers and Britain's Psion.

Microsoft is expected to give an update on its wireless software products

later on Tuesday, and could announce details of a mobile product launch with a

US carrier.

Phone computers



Jeff Raikes, head of Microsoft's productivity and business services group,
is set to discuss the progress the company is making in winning acceptance of

its PocketPC Phone Edition software at a trade show speech in New York on

Tuesday.

PocketPC Phone Edition is the software designed to run a new generation of

Internet-friendly phones, a slightly different version of the system it offers

for handheld computers. The Phone Edition adds a personal information manager

from which users can make calls, send and receive emails or communicate using

SMS text messages.

Microsoft recently launched its first wireless PDA with British operator

mmO2, called XDA, which combines a cellphone and a handheld organiser running on

PocketPC Phone Edition.

Microsoft has signed technology partnerships with some 20 other major mobile

operators, including Italy’s TIM, Germany's T-Mobile and Spain’s Telefonica

Movile. Until now future product launches have been absent, but a lot has

happened behind the scenes, another source said.

Most of the large mobile carriers will order Microsoft-based devices as part

of a wide range of services and products from Microsoft, he said. Deutsche

Telekom’s VoiceStream, a sister company of its T-Mobile, is set to introduce

services based on such phones in the United States during third quarter.

One supplier



Microsoft last year launched mobile versions of its dominant Windows desktop
computer operating system for smart phones and wireless handheld computers. This

year it added reference designs that operators can take to contract electronics

manufacturers to order Microsoft-based devices.

Some operators will sell Microsoft devices under their own brand name, while

others will also use the brand name of the electronics producer, the sources

said.

The operators are buying into Microsoft's vision that business users and

consumers prefer familiar PC software on smaller, portable devices. Microsoft's

PocketPC offers slimmed-down versions of Microsoft Word word processing and

Excel spreadsheet programs. Desktop computers and mobile devices running the

same family of software applications should also be easier to integrate,

Microsoft has said.

PocketPC offers a variety of enterprise security features such as Virtual

Private Networks and Terminal Services that make it the most popular mobile

device for gaining access to data that sits on office desktop computers.

(Additional reporting by Eric Auchard in New York)

(C) Reuters Limited.