Microsoft Debuts 'Project Pink' Phones

Story updated with Verizon Wireless response.

REDMOND, Wash. ( TheStreet) -- Microsoft's ( MSFT) 'Pink' phones are expected to make their debut today, as the software maker attempts to gain some smartphone street-cred.

The word is that Microsoft is planning to launch two colorful phones at an event in San Francisco later today, one of which is said to be a clamshell phone while the other will use a candy bar form factor. Both phones are expected to focus on social networking features and will likely be aimed at young adults.
Microsoft

The Zunited blog, however, says that both phones will use sliders with keyboards. One, code-named Turtle, resembles a fat Palm ( PALM) Pre, while the other, dubbed Pure, is more like a Motorola ( MOT) Cliq.

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Last month, Gizmodo said that it had leaked images of the phones, but described the Pure as more akin to T-Mobile's Sidekick.

With the phones expected to use part of Microsoft's Windows Phone 7, the devices are an attempt by the software giant to gain a foothold in the smartphone market.

Windows Phone 7, which was launched at Mobile World Congress, aims to claw back share from the likes of BlackBerry, Apple's ( AAPL) iPhone OS and the Symbian operating system, which is championed by Nokia ( NOK). Google's ( GOOG) Android operating system has also increased the pressure on Microsoft.

Microsoft's previous mobile operating systems have left Redmond way back in the smartphone race, although a Microsoft-built hardware/software combo would significantly boost the company's profile.
Who Owns Microsoft?

Jefferies & Company analyst Katherine Egbert thinks that phones form a key component of the company's long-term strategy.

"Pink would be the third screen (after Windows and Xbox) and final component in Microsoft's '3 screens and a cloud' strategy," she said in a note released earlier this year, but warned that meaningful phone revenue could be years away.

Perception, even more than technology, will be a key battleground for Microsoft as it rolls out its 'Project Pink.' For young people reared on a diet of smartphones and mobile Internet, Microsoft lacks the cachet of Apple and its iconic iPhone. Pricing and design aesthetic will thus prove crucial in Microsoft's phone strategy.

Last week the Wall Street Journal, citing an unnamed source, reported that the new Microsoft phones will run on Verizon ( VZ) Wireless, although the telco told TheStreet that it doesn't comment on rumors.

Microsoft also refused to provide information for this article, saying that it can only comment on products that are already on the market. A spokesman, however, explained in an email to TheStreet that the company "looks forward to sharing more information on April 12th."

Microsoft's stock has dipped 1.04% over the last three months, but closed up 42 cents, or 1.4%, to reach $30.34 on Friday.

-- Reported by James Rogers in New York

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