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Microsoft seems to be excluding HTC from Windows

With falling stock price, decreasing sales, and Microsoft said to be shutting it out of Windows device manufacturing, things aren't looking to hot for HTC right now.

Windows RT tablets will use the Metro interface.

Microsoft is rumored to be edging HTC out of its next version of Windows software, according to Bloomberg. The reason being that the software giant is uneasy about HTC selling enough products or having enough experience making tablets.

This doesn't bode well for HTC's revenue outlook. According to Bloomberg, HTC's second-quarter sales forecast looks to be decreased by 13 percent. On top of that the company's stock has dropped 68 percent in the last year and it is failing on coming close to competing with Apple or Samsung in software or device manufacturing.

"Every consumer knows about Samsung's Galaxy platform and the iPhone, and you are starting to see consumers coalesce around them," Avian Securities analyst Matthew Thornton told Bloomberg yesterday after he cut his rating on HTC to negative. "Things just get worse from here. It's a very bleak outlook."

CNET reported last month that only a handful of Windows RT devices will appear at first with chipmakers Nvidia, Qualcomm, and Texas Instruments initially getting two "slots" each for devices.

"ARM is restricted to two designs each, meaning six total initial designs," one source told CNET last month, referring to the chip design from U.K.-based ARM that those three suppliers use. Windows RT, or Windows on ARM, will be the first mainstream, desktop-class Windows operating system to run on ARM chips.

Though final product decisions have not been made in some cases, they could be a tablet, a hybrid tablet-laptop, or a more conventional clamshell laptop design.

According to Bloomberg, HTC engineers vied to build a Windows device that would have a customized home screen typical of its other devices but Microsoft refused. However, some sources told Bloomberg that HTC still might release a Windows device in the second round of products that are scheduled to be coming out next year.