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Microsoft dials in Internet telephony

A new version of the software giant's operating system for small devices, due in June, can be used to make Internet phones. Half a dozen device makers have signed on.

A new version of Microsoft's operating system for small devices, due in June, can be used to make IP phones, the software maker will reveal Wednesday.

Hitachi, NEC, Casio Computers, Samsung and three other manufacturers intend to develop IP phones using the new version of WindowsCE.Net after the software's release, according to Microsoft Director Scott Horn.

Makers of processors used inside these devices, such as Texas Instruments and ARM, are adapting their own products to support the new feature, Horn said.

The developments mark the most aggressive moves yet by Microsoft into Internet telephony, a cheaper way of dialing that is beginning to take hold inside many U.S. offices. Because the calls travel over the Internet, companies avoid paying long-distance charges. About 6 percent of all international calls made in 2002 used IP phone equipment. That figure is expected to rise by 5 percent or 6 percent this year.

The new Microsoft-based products will be aimed right at businesses, Horn said, adding that over time the company sees them migrating to consumers. Horn did not disclose prices or when the products would be available on store shelves.

Microsoft has dabbled in Internet telephony before, but its efforts usually involved only personal computers, not mobile devices, Horn said. "This is the first time we've ever come out with VOIP (voice over Internet Protocol) that people can use in phones," he said.