Microsoft: Time to Dial Zune Smart Phone?

Is Microsoft ready to hedge its smart phone bets? As Windows Mobile struggles to match the iPhone, Blackberry and Android hype, there are signs Microsoft may take a new direction in the smart phone market. The chatter involves a potential Zune smart phone. The question: Would Zune smart phones really strengthen Microsoft’s position in the consumer and/or corporate markets? Hmmm…

Microsoft’s Zune update, version 4.2.202.0, has a driver package that points to a phone. In short, the INF file for the device has a line of code reading ” %Phone.DeviceDesC%.”

Long Zheng, first noted the files and posted the discovery on his blog. InformationWeek pokes at the irony, which comes shortly after an analyst who said Microsoft would be releasing a Zune Phone sooner or later. InformationWeek adds:

Jefferies stock picker Katherine Egbert said the company would likely unveil the device next month at the Mobile World Congress in San Francisco. Alternately, the software maker might introduce its phone at the CTIA conference in March in Las Vegas. The phone would likely feature a built-in camera and HD video screen, Egbert said in an interview with BusinessWeek.

Cheering On Zune

Without a doubt, Microsoft is an also-ran in the smart phone market right now. So a Zune Phone might be a good idea. It’s kind of an Apple approach. The iPhone was developed as a multimedia device and a phone at the same time. Windows Mobile has kind of been a ungodly conglomeration between PDA and phone smashed together.

The Zune, already a multimedia device, could make a great phone with a little extra development. Anyone who’s played with a Zune (yes, even this Apple fan-boy) can attest that it has a pretty slick interface.

If you don’t think the Zune Phone could be a contender in the ‘enterprise market’ I’d just point you to the iPhone, which currently has Microsoft Exchange support and a huge appeal to CEOs and employees alike.

Will that mean that Microsoft will abandon Windows Mobile and refocus on the Zune phone as a true iPhone and Android competitor? It’s unlikely. Microsoft is notorious for doing a million things at once. But if the Zune phone turns into a hit, and a good one at that, it could then spur a development change and a fresh shift in Microsoft’s mobile strategy.

Like most speculation, we’ll just have to take a ‘wait and see’ attitude for now.