Feb 19 - Microsoft Corp., Intel Corp and Texas Instruments Inc. on Tuesday announced blueprints for new cellphones and handheld computer phones.
Breaking with the tradition of custom-designed technology for each cellphone manufacturer, the three companies will work to develop so-called reference designs, which, if adopted by enough vendors, could establish these blueprints as standards for much of the industry.
The companies aim to repeat what they have done to the personal computer industry, where Microsoft and Intel have standardised key software and semiconductor hardware, with the Windows operating system software and Pentium processors. Each product has more than 80 percent share of their respective markets.
The U.S. companies made their announcements at the 3GSM World Congress here, Europe's largest trade show for the wireless industry, which is still dominated by European companies such as Ericsson and Nokia.
But at the same time, analysts noted that Microsoft hadn't made a great deal of headway since last year's GSM conference, when it signalled its intent to go after the smartphone market. Microsoft has developed such designs before, for handheld computers and so-called tablet PCs.
"Microsoft still doesn't have any products to show for," said Gartner analyst Ben Wood.
In separate deals with Microsoft, semiconductor makers Intel and Texas Instruments will work together to develop integrated chips and software that can turn a handheld computer into a mobile phone, ready to make calls and download corporate email.
An Intel spokesman said that his company and Microsoft would have a design available later this year. Texas Instruments already has a product developed.
For its part, Microsoft is backing Intel's PCA technology, which is a blueprint that the chipmaker is pushing as a standard for next-generation wireless phones and handheld computers that work with its XScale processors. Intel, in turn, is backing Microsoft's PocketPC Phone operating system, which is gaining ground against the Palm Inc. operating system.
Smartphones and personal digital assistant (PDA) phones are different categories. PDA phones are handheld computers that are mainly used for wireless data communications, but they can double as a phone. Smartphones are first and foremost light voice phones, and get their "smarts" from the ability to display diaries, receive email and play music files.
Microsoft is betting that consumers and employees will want to read their email and messages in a format that resembles their computer email.
SMARTPHONE COLLISION
Microsoft is taking on a mobile phone industry that is already facing increased competition in low-end cellphones from Asian electronics makers. The industry had hoped the smartphone segment would remain an exclusive, high-end business for the next few years.
Microsoft will have to fight an uphill battle as many cellphone vendors have stakes in Britain's Symbian, which is currently rolling out its own smartphone software that can handle email, calendars and messages.
Symbian is backed by four of the world's top five cellphone makers, which make 70 percent of all cellphones produced worldwide. SonyEricsson and Nokia have already launched their first smartphones that run on Symbian.
Intel, in August 2001, said it and Symbian would collaborate. Symbian software allows for greater compatibility between different smartphones than its Microsoft counterpart.
Of the top five cellphone manufacturers, only Samsung has said it will use Microsoft Windows Powered Smartphone 2002 software. The South Korean company, the world's fourth largest cellphone maker, is expected to launch a Microsoft-based product at the end of this year.
Japan's Mitsubishi and Britain's Sendo are the only other cellphone makers to use Microsoft Smartphone software, with Sendo closest to a commercial launch.
PDA PHONES
The situation is different for phone-enabled PDAs, where Microsoft faces competition from Handspring, Nokia and Canada's Research In Motion.
Microsoft on Tuesday boasted two new clients for its Pocket PC Phone edition. One is Hewlett-Packard, which will introduce a PDA (personal digital assistant) phone based on the TI-Microsoft platform. HP said the device will on the shelves in June.
Taiwanese peer Compal, which already produces Compaq's iPAQ Pocket PC, said it will also use Microsoft phone software.
The first Pocket PC Phones will hit the shelves almost simultaneously with Handspring's Treo. The Treo, based on Palm software, is lighter and smaller than its Microsoft rivals.
However, the partnerships with Intel and Texas Instruments have given Microsoft powerful allies to quickly gain support and extend its lead in this product category, which is already quite similar to the PC industry, said Gartner's Wood. (Additional reporting by Scott Hillis in Seattle, Wash.)
The company is one of many handheld makers looking to push wireless services, but it is the first to use the Pocket PC 2002 operating system. Alternative handhelds using the Palm operating system already have products on the market.
Palm's second-generation wireless handheld, the i705, provides “always-on” wireless e-mail access through the company's Palm.net service. Competitor Handspring on Feb. 10 began selling its Treo communicator, a Palm OS-based handheld that doubles as a cell phone.
As the battle for market share in the handheld industry heats up, manufacturers continue to look for ways to add new capabilities to their products as a way to explore new sources of revenue and grab new customers. Business applications, such as wireless e-mail, have been at the forefront of many companies' strategies, taking a cue from the popularity of Research In Motion's BlackBerry e-mail pagers.
The Jornada will allow voice calls over GSM (Global System for Mobile Communications) and GPRS (General Packet Radio Service) networks. In addition, the Jornada incorporates voice-activated dialing and wireless Web surfing.
A device similar to the one launched initially in Europe and Asia this summer will be available in the United States by the end of 2002. Pricing for the Jornada device and the required wireless service has not been set.
The Jornada uses a 133MHz Texas Instruments OMAP 710 processor and contains 64MB of memory and a lithium-polymer rechargeable battery. Like its predecessors, the Jornada comes with a CompactFlash Type I slot for expansion cards. The device is 0.7 inches thick, 3.1 inches wide and 5.4 inches long, and weighs 6.8 ounces.
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