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Microsoft is reported to be looking for a smart-phone manufacturer to produce a low-cost Windows Mobile device. The motivation: to boost the company's share of the mobile-device operating system market.

Citing sources from among Taiwan's ODM community, DigiTimes reports the software giant wants to see Windows Mobile smart-phones on the market for under $300. The site claims Microsoft has been talking to HTC, Quanta, Asus, Acer, Mitac, BenQ and other Taiwanese phone makers.

Symbian remains the world's most successful mobile operating system, almost entirely because Nokia has used it not only for high-end smart-phones but to drive mid-range feature-phones too. Windows Mobile's share is growing - it will gain a boost early next year when Palm ships its Windows Mobile-based Treo 700w - but it's almost entirely focused on high-end devices like smart-phones and PDAs with integrated telephony.

Symbian took 63 per cent of the market in Q3 2005, well above Microsoft's 15 per cent share and PalmSource's nine per cent, market watcher Canalys told The Register. The remaining 13 per cent is divided up among the numerous mobile Linux and proprietary OS vendors.

Speaking of Palm, its plan to offer more budget-priced, Palm OS-based Treos sometime in Q2 next year is a sign that it too believes the time is right to push the technology out to a broader, more mainstream audience.

The difficulty is the inherent cost of feature-rich phones, and the need to get the sales volumes that will allow the economies of scale necessary to get the price down without sacrificing too many features. Nokia can do it, but it's questionable whether the much smaller Taiwanese firms, with far weaker brand recognition, can do so. Their advantage is their close connections to the networks, and its not hard to see why Palm and HTC, in particular, are currently very keen to cuddle up to European carriers. Over the last few months, both have opened carrier-focused European R&D centres. ®

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