Tuesday, February 12, 2008

Sony Ericsson to make Windows Mobile phones

Sony Ericsson (6758.T: QuoteNEWS , Research) (ERICb.ST: QuoteProfile , Research) and Microsoft (MSFT.O: QuoteProfile , Research) will cooperate in making smartphones, with the first Sony Ericsson handset based on the Windows Mobile operating system on sale by the end of the year.

The world's fourth-biggest cell-phone maker also unveiled six other new models on Sunday, including two additional touch-screen phones, a Walkman music phone with 8 gigabytes of memory and a dust-resistant camera phone.

The Microsoft deal means all the world's top handset makers apart from Nokia (NOK1V.HE: QuoteProfile , Research) will now have Windows Mobile versions. The Sony Ericsson model, named the "X1," will be a slider phone with a typewriter-style qwerty keyboard and touch screen.

The marketing manager of Microsoft's mobile business, Scott Horn, told Reuters he was confident of reaching the company's goal of selling at least 20 million smartphones with partners by the end of Microsoft's fiscal year at the end of June.

About 123 million smartphones -- phones with computer-like capabilities such as e-mail and Internet browsing -- were sold in 2007, according to market research firm Gartner. In total, about 1.14 billion phones were sold worldwide.

Nokia, the world's biggest maker of mobile phones with 40 percent of the market, sold nearly 19 million smartphones in the fourth quarter alone.

The Finnish company does license some software for music and e-mail from Microsoft, but does not use Windows Mobile operating system.

"We'd love them to do it," said Microsoft's Horn. "We have a very good relationship with them. I think our hope is that at some point they say: 'Why not just license the whole thing?'"

Sony Ericsson has become best known for its strongly branded Walkman music phones and Cybershot camera phones.

Microsoft has alliances with dozens of handset makers including four of the top five as well as more specialized vendors like Taiwan's HTC (2498.TW: QuoteProfile , Research), the world's biggest maker of smartphones.

(Reporting by Georgina Prodhan and Tarmo Virki; editing by Maureen Bavdek)

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