Deal reshapes mobile phone market

Seattle PI | at | by Mike

Microsoft has won its biggest-ever contract for mobile-phone software, an order from the U.S. Census Bureau that covers 500,000 handsets.

Microsoft expects to increase its mobile unit's sales to $1 billion in one to three years, from $337 million last year, and break the dominance of Research In Motion Ltd.'s BlackBerry.

"Up until now, BlackBerry had the market for themselves," Pieter Knook, a Microsoft senior vice president, said. "That landscape has changed." Sales of handsets with Windows will double to 20 million units in 2007 as corporate customers opt for those devices instead of the BlackBerry, Knook said. They still would be just a fraction of Microsoft's almost $40 billion in annual sales.