Palm has unveiled a forthcoming Treo smart phone that runs Microsoft's Windows Mobile 5.0, and ships early next year.

Palm president and CEO Ed Colligan called the Windows Treo a "historic" product that the company hopes will help it become a supplier to IT departments around the world.

Colligan was joined on stage by Microsoft chairman and chief software architect Bill Gates and Verizon Wireless president and CEO Denny Strigl, whose company will be the exclusive provider of the Windows Treo for several months.

"This is our first 3G product," Colligan said. Verizon's growing EV-DO (Evolution-Data Only) network based on CDMA (Code Division Multiple Access) technology allows download speeds between 400Kbps (bits per second) and 700Kbps in some parts of the US.

Verily Verizon

Verizon provided much of the impetus for the deal, said Joe Fabris, director of wireless and business marketing at Palm. Palm and Microsoft had talked about working together for a while, but Verizon's interest in a Windows Treo for its EV-DO network persuaded the companies to act.

The companies have been working on the product for several years, Colligan said.

Palm's Treo 600 and 650 have sold well, mostly to individuals. The devices also run Palm OS.

However, Windows Mobile 5.0 allows users to hook their Treos into their corporate Exchange email servers and deploy corporate Windows applications on the phone, Colligan said.

Microsoft believes that eventually all professionals will have a phone that allows them to access their email, Gates said.

Microsoft and Palm worked together to build some of Palm's application expertise into the Windows Treo.

Palm OS nears expiration?

Colligan did not directly address the future of the Palm OS within Palm's smart phones and PDAs. He called the Microsoft announcement an "expansion" of Palm's product line, saying "this is not about other things going away. This is about growth."

Afterward, Fabris declined to comment on the possibility of Windows Mobile-based Zire and Tungsten PDAs, but Allen Bush, director of business marketing for Palm, said Palm will continue to release updated versions of Palm OS-based Treos.

Some corporations have already deployed the Palm OS Treo 600 and 650 devices within their enterprises, and they might want to continue along that path, Bush said. Other companies that are more interested in having Windows across all their devices or have strict data security requirements might prefer the Windows Treos, he said.

"We plan to have products on both platforms for a long time to come," Bush said.

No WiFi built-in

In interviews, Palm executives shared few details about the device. It is about the same size as the Treo 650, with a QWERTY keyboard and green and red "Send" and "End" buttons for making phone calls. It will feature an SD (Secure Digital) slot, and come with one of Intel's Bulverde processors, Bush said.

The Windows Treo will shio with WiFi, disappointing some analysts. Colligan said that users will be able to connect to WiFi networks with an SD card, but those cards take up space that could otherwise be used for storage and sap battery life, said Gerry Purdy, principal analyst with MobileTrax.

The lack of WiFi access could dissuade some corporate customers, said David Linsalata, an analyst with IDC. However, most users will probably check their email or browse the Internet on these phones, rather than working with demanding mobile applications that require more bandwidth, he said.

Palm plans to bring the Windows Treo to other wireless carriers in the second half of 2006, Colligan said. This will include GSM/GPRS (Global System for Mobile Communication/General Packet Radio Service) carriers in Europe and Asia, Fabris said.