By Ben Charny
Thursday, April 01 2004 09:56 AM
URL: http://www.zdnetasia.com/news/software/0,39044164,39174036,00.htm

SANTA CLARA, Calif.--Microsoft said Wednesday that major manufacturers, including NEC and LG Electronics, intend to create Internet phones with the newest version of Windows CE, Microsoft's operating system for small devices.

The first substantial wave of phones from the equipment makers is expected in about three months, Microsoft Product Manager Balz Wyss said.

The manufacturers are among 22 new licensees Microsoft announced Wednesday for its latest Windows CE software, which is a stripped-down version of the Windows operating system intended for handheld devices, set-top boxes and other limited-function computing devices other than PCs and servers. The new CE software, version 5, contains much improved technology for making phone calls on the Net with voice over Internet Protocol (VoIP), according to Microsoft. Internet Protocol is the most popular method of sending data from one computer to another.

One phone using the operating system is already available. Last month, Inter-Tel Integrated Systems began selling its 8690 advanced IP phone.

By focusing on VoIP phones, Microsoft has begun competing with technology heavyweight Cisco System, which makes most of the VoIP phones used in businesses and homes. A Cisco representative could not be immediately reached for comment.

Wyss said here at the Spring 2004 Voice on the Net Conference & Expo that he believes the new CE software could be used to spread VoIP technology into devices that aren't necessarily thought of as phones, but still use Windows CE software.

"Any device connected to the Internet can be (broadband phone) enabled," he said.

Most of the 22 licensees are manufacturers. But one is broadband phone service provider Vonage, which has 130,000 subscribers. Vonage plans to create a "soft phone" that can be added to any devices that use the new Windows CE operating system. Soft phones are computer programs that turn any device equipped with a speaker and a microphone into an Internet phone.