Google, Microsoft, Palm rev up smartphone race

Google,Microsoft, Palm rev up smartphone race

Google Inc,Microsoft Corp and Palm Inc stepped up efforts to bolster theirsmartphone line-ups, as the tech industry's key players increasinglymove to challenge Apple Inc's popular iPhone.

In a flurry ofannouncements on Tuesday ahead of the holiday shopping season, thecompanies introduced new phones, wireless carrier partnerships andefforts to boost the availability of new applications for the phones.

The moves underscorethe extent to which the smartphone market has emerged as a primebattleground encompassing a variety of technology businesses and oneof the few markets experiencing rapid growth in a rough economicenvironment.

"Everyone wantsto build up and bolster their smartphone portfolio, because that'swhat drives more dollars for the carrier and that's where the marketis going," said Avian Securities analyst Matthew Thornton.

Google, the world'slargest Internet search company, said it was teaming up with VerizonWireless to co-develop multiple phones based on its Android operatingsystem. They plan to bring two phones to market this year, andVerizon Wireless CEO Lowell McAdam said the partnership could resultin the introduction of multiple devices per year going forward.

The partnership withVerizon Wireless, a venture of Verizon Communications Inc andVodafone Group Plc, is a boost for Google's efforts to gain afoothold in the smartphone market.

It caps a string ofAndroid phone announcements, including Motorola Inc's recentintroduction of the Cliq phone and HTC's Hero phone, slated for U.S.release next week.

Google does notcharge a licensing fee for Android but hopes to benefit by servinghighly targeted mobile ads to users.

Microsoft, whosesoftware is used in the majority of the world's PCs, unveiled onTuesday a new version of its smartphone software, Windows Mobile 6.5,and promised more than 30 new devices with the software would beavailable in more than 20 countries by year's end.

According toresearch firm IDC, smartphones running Microsoft software accountedfor 11 percent of the worldwide market in the first half of 2009,compared to 11.7 percent share for Apple's iPhone and 19.9 percentshare for Research in Motion's Blackberry.

Nokia's Symbianoperating system had the largest share with 46.4 percent share.

iPhonethe one to beat

But analysts saythat Apple's iPhone, despite its modest share of the market, is theproduct to beat.

"It may not bereflected in the numbers, but everyone is playing catch-up" withApple, said C.L. King analyst Lawrence Harris.

In addition to thetechnological innovations ushered in by the iPhone, such as itsmulti-touch screen, Harris said that Apple is the clear leader whenit comes to the software apps created by third-party developers towork with a smartphone.

Apple has 85,000apps available through its iPhone Apps store.

"The fact thata particular app is available can help drive the purchasingdecision," said Harris.

In a sign of howcritical apps have become in the smartphone race, Microsoft alsoannounced the launch of a new marketplace for Windows Mobileapplications. And Palm announced it was making its "WebOS"smartphone software more open for outside developers to createapplications.

Google said thereare more than 10,000 free and paid apps available for Androidsmartphones.

Verizon Wireless andGoogle sought to play up the open nature of Android apps compared tothe tight control that Apple exercises over its software.

The first Androidphones from Verizon Wireless will support the Google Voice softwareapplication, which allows consumers to make low-priced internationalcalls and which Apple has yet to approve for its iPhone.

"You eitherhave an open device or not. This will be open and we expect to bringthat application to market when we bring the first device out,"said Verizon's McAdam, referring to Google Voice.

Google has said thatApple rejected Google Voice, while Apple contends it is stillevaluating the software, in a high-profile spat that has attractedthe attention of the U.S. Federal Communications Commission.

On Tuesday, AT&TInc, which has the exclusive rights to the iPhone in the U.S., saidit will allow third-party Internet telephone calls to be on theiPhone using AT&T's third generation network, reversing aprevious position to ban such calls due to revenue concerns.