Microsoft pairs with Ericsson: Wireless truce gives both companies more options

While the deal Microsoft struck with Ericsson last week is being compared to Microsoft's joint venture with Qualcomm, the two partnerships actually show the different faces of Microsoft.

Outwardly, the deals are similar. Both aim to wirelessly deliver e-mail and other personal information, primarily from corporate intranets to wireless devices. From there, though, they diverge on many levels.

Wireless Knowledge, Microsoft's joint venture with Qualcomm, was initially an effort to strong-arm the wireless industry. Microsoft entered the market competing with accepted industry standards, such as wireless applications protocol (WAP).

The Ericsson deal shows that Microsoft has stopped fighting. "We have given up competing with WAP and Bluetooth. We adopt those efforts," said Bob Muglia, group vice president of Microsoft's business productivity group. Microsoft now vows to work together with the industry "in an open fashion to evolve the conversion of those [standards] with [IP's]."

As part of the agreement, Ericsson will incorporate Microsoft's Mobile Exchange microbrowser, which is WAP-compliant, into some of its future phones. Ericsson also will use Microsoft's Windows NT Server and Exchange Platforms.

"It's the strongest endorsement yet by Microsoft of WAP," said Ben Linder, vice president of marketing for Phone.com. The agreement isn't any threat to Phone.com's business, he said. "We like it because it creates more applications and content to run on our platforms," he said. Solutions from the joint venture will operate via WAP-based browsers so users must communicate via WAP servers, such as Phone.com's.

Microsoft claims that its browsers will read WAP and HTML content. Ultimately, Microsoft hopes to converge WAP and Internet standards, which puts it on the same track as the WAP Forum. The forum is working closely with the Worldwide Wireless Consortium to converge WAP with XHTML, which is the future extensible markup language (XML)-compliant version of HTML, Linder said.

Pledging to work with the industry doesn't mean that Microsoft is without an agenda. Microsoft's motivation behind the Ericsson agreement is to sell NT, CE and its browser, said Barney Dewey, a consultant for The Andrew Seybold Group. "Those are the three areas Microsoft wants to push in this space," he said. NT especially may be important for Microsoft. "People don't currently look at NT as a robust enough system to be able to handle telecom tasks," Dewey said. Instead, UNIX products from companies such as Sun Microsystems and Compaq are more widely used in the telecom space.

Microsoft's microbrowser, which the company plans to release to handset manufacturers in the middle of next year, will come in two versions - only one of which Ericsson will use for now. One version of the browser will operate over any operating system (OS) while the other will use a version of Windows CE for mobile phones.

That open version may have been a requirement for the Ericsson agreement because of Ericsson's allegiance to Symbian, an OS that will compete with Windows CE for mobile phones. "Windows CE is not a part of this deal. We are committed to what we are doing with Symbian," said Jan Uddenfeldt, senior vice president of technology for Ericsson. Ericsson's smart phones will run Microsoft's microbrowser on top of the Symbian OS.

Some believe that despite Ericsson's commitment to Symbian, this new relationship with Microsoft may indirectly influence Ericsson to someday use Windows CE. The product would have to evolve first, though. "I don't think Win CE is a winning [OS] for hand-held devices. It's not clear if it ever will be," Dewey said.

Microsoft's future in the wireless industry is unclear. Because the Ericsson deal is not exclusive, some believe that Microsoft will make other, similar agreements. That may depend on success. Wireless Knowledge, for example, has been very slow to take off.