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Palm Axes Windows Mobile Phones

CEO says company will instead focus on promoting its own webOS platform.
In a setback for Microsoft, smartphone maker Palm said Thursday that it will abandon the Windows Mobile platform for its devices in favor of its own webOS mobile operating system.

"We've made the decision to dedicate all future development resources to the evolution of webOS," said Palm CEO Jon Rubenstein, in a conference call with investors, according to numerous industry blogs. "Going forward, our roadmap will include only Palm webOS-based devices," Rubinstein reportedly said.

Palm's webOS powers its new Pre device, which the company is positioning as an alternative to RIM's ubiquitous Blackberry for road warriors and other business professionals. Other Palm offerings, like the popular Treo, run Windows Mobile.

Reasons behind the move were not immediately clear, but Palm's decision to ditch Windows Mobile in favor of its own technology means that it won't have to pay licensing fees to Microsoft for the phones it sells. Palm needs to shore up its bottom line, as the company on Thursday reported a quarterly net loss of $161.1 million, compared to a loss of $39.5 million for the same period a year ago.

As for Microsoft, Palm's decision will make it more difficult for the company to gain market share in the smartphone market, where it significantly trails iPhone manufacturer Apple.

Microsoft itself is hedging its bets by developing software for non-Windows mobile platforms. Microsoft and Nokia announced a broad alliance last month under which the two companies will work together to optimize Microsoft applications, including the Office productivity suite, for use on Nokia's mobile devices.

The agreement calls for the mobile version of Microsoft Office to run on Symbian.

Nokia's open source Symbian owns about half the worldwide mobile OS market, while Windows Mobile controls less than 10%, according to the most recent numbers from research group Gartner.

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