In an attempt to gain market share in the mobile phone and device industry, Microsoft released an operating system yesterday with new features...

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In an attempt to gain market share in the mobile phone and device industry, Microsoft released an operating system yesterday with new features for phone users, wireless carriers and handset manufacturers.

Microsoft has come a long way since it entered the mobile-phone market but still lags behind competing products offered by Symbian and Research in Motion, maker of the BlackBerry.

The challenge for all the rivals has been to make faster networks, expensive phones and a range of applications add up to must-have technology instead of a just nifty gadget.

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“Software is driving the future of these devices and that for us is a great opportunity,” said Microsoft Chairman Bill Gates, who unveiled Windows Mobile 5.0 yesterday at a developers conference in Las Vegas.

Code-named Magneto, the operating system had been widely expected, but details were kept secret until the morning announcement.

The release’s highlights are in three areas:

• Flexibility, including the ability by carriers to offer features such as push-to-talk and the ability to use a keypad instead of a stylus.

• New applications, such as the ability to view, edit and create PowerPoint presentations on handhelds, and the use of bold and italics in Word Mobile documents.

• Multimedia, such as integrating Windows Media Player 10 so that users will be able to sync their music playlists from their PCs to their devices.

Microsoft said Windows Mobile 5.0 also makes it easier for developers to build new applications. Gates said that has been Microsoft’s key strategy: getting developers to build more software so that consumers are more likely to choose Microsoft products.

“One thing they’ve [successes] all had in common is that we reached out to developers and provided the tools and got great applications developed for the platform,” he said in a keynote address that was Webcast.

Before the release, industry analysts said they expected the features would compete directly with the BlackBerry, which has 3 million subscribers and has won wide acceptance among business users for its simplicity in handling e-mail on the road.

With yesterday’s disclosures, however, the thinking has switched. Features appear to be closer to those offered by Symbian, said David Linsalata, an analyst at IDC.

Symbian, created in 1998, is half-owned by wireless-handset giant Nokia, which uses mostly Symbian operating systems on its phones.

According to Linsalata’s figures, Symbian is the leader in the industry with a 69 percent market share; proprietary systems (mostly BlackBerry) are in second with about 13 percent. Microsoft is third with 9 percent, and PalmOS and Linux systems rank lower.

His projections indicate that by 2009, Symbian will have 60 percent; Linux, 17 percent; Microsoft, 16 percent; and others, including Blackberry, 4 percent. The reason BlackBerry trails is because it targets only the enterprise market, he said.

Symbian said yesterday that at the end of March, its operating system was installed in 48 phone models offered through more than 200 network operators around the world. For its part, Microsoft has 40 device makers shipping Windows Mobile-based products through 68 mobile operators in 48 countries.

Linsalata said Microsoft’s new system added many components that could be attractive to business users, including the PowerPoint availability. But it also has focused on the consumer by increasing multimedia functions.

During yesterday’s demonstration, Microsoft showed how a photo taken by a camera phone could be uploaded into Microsoft Outlook and associated with a particular person in the contacts list. When that contact e-mails the user, the photo appears, giving a visual signal of who the sender is.

Scott Horn, senior director of Microsoft Mobile and Embedded Devices Group, said yesterday that Microsoft tries not to differentiate between enterprise customers and consumers.

“You can’t just address one without the other,” he said. “You can’t only talk to a business customer about messaging, and to a consumer, you can’t talk about games, without talking about e-mail. You have to talk about the whole end-to-end solution.”

Devices with Windows Mobile 5.0 are expected to be available this summer. Microsoft is working on its next release of its Windows Mobile platform and expects it out next year.

“We have to continue to keep innovating,” Horn said. “Our challenge with every release is in determining what not to do than to do.”

Tricia Duryee: 206-464-3283 or