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Microsoft Rings Up Partners For Smartphone

Microsoft Monday said it has teamed up with two U.S. partners to help it build a smartphone running its operating system for the first time in North America.

Building on its year-old wireless relationship with AT&T Wireless , the Redmond, Wash.-based company says it has also teamed with Motorola to offer the MPx200. The clamshell style handset runs the Windows Mobile operating system and is based on the GSM (Global System for Mobile Communications)/ GPRS (General Packet Radio Service) standard. AT&T Wireless vendors will sell the devices primarily. Prices for the phones and service will depend on individual dealers.

"We are taking the next leap forward in unwiring the corporate office," AT&T Wireless Mobile Multimedia Services president Andre Dahan said in a statement. "The MPx200 is an ideal device for mobile professionals looking for a wireless extension of their workplace -- and for consumers looking for the ultimate in multimedia functionality."

Beyond mobile calls and basic organizer capabilities (phone book, calendar, tasks), the color screen phone also supports Web browsing via Pocket Internet Explorer and includes MSN Messenger service. Users can listen to Windows Media Audio (WMA) and MP3 music files and can add up to 1 gigabyte of expandable memory via memory disk.

Microsoft says customers can install applications and software on their handset wirelessly or from a PC via USB connection. The companies also say the MPx200 also will have "one-click" access to AT&T Wireless' mMode service (news, weather, sports, gaming) starting at $2.99 a month plus usage charges.

The device is expected to debut next month from Orange in Europe and from other distributors throughout Europe and Hong Kong. Motorola said the MPx200 should hit U.S. store shelves in the fourth quarter of this year -- just in time for the holiday season.

"We consider this alliance with Motorola to be a tremendous milestone for our Windows Mobile platform and a major win for customers, operators and developers," said Pieter Knook, corporate vice president of mobile and embedded devices at Microsoft.

The number one software maker is no stranger to smartphones and is counting on more than 7 million Windows developers to create new market opportunities especially to counter smartphones by Nokia , Kyocera and other devices running the Symbian operating system.

According to statistics published earlier this year, 60 percent of smartphones are running Symbian OS, but London-based ARC Group expects this share to fall to 39 percent by 2007. Palm OS accounts for 22 percent of the market, falling to under 5.5 percent in 2007 as Microsoft OS gains momentum and rises from its current 6.6 percent share.

Overall, the analyst firm says global shipments are on track to grow from less than 1 percent of total mobile handsets in 2002 (3.5 million units) to 5 percent in 2007 (45 million units).

When Microsoft jumped into the smartphone game it was in Europe with the help of French-owned Orange. At the time analysts said it would only be a mater of time before it found partners for its foray into the Americas.

Many critics believed that partnership would include Intel and Deutche Telekom's T-Mobile considering the amount of noise that was made at the 3GSM World Congress in Cannes, France in February.

But three months later, T-Mobile said it would postpone the planned launch of its new handset citing quality concerns. T-Mobile said its smartphone will be manufactured by Taiwan's High Tech Computer (HTC), which also made the Orange SPV in conjunction with Microsoft.

Motorola also has its smartphone irons in a few fires. In addition to being a major backer of the Symbian partnership, the Schaumburg, Ill.-based wireless giant cut a deal back in March with MontaVista Software to build a Linux/Java-based smartphone.