The world's largest software maker has struggled in the mobile phone market, but sees a chance to unseat entrenched rivals, such as market leader Symbian Ltd, with Windows Mobile 5.0.

"We've made a heck of a lot of progress," Microsoft Chief Executive Steve Ballmer said in an interview. "I think we've learned a lot."

The maker of the Windows computer operating system launched a mobile phones unit about five years ago.

The cell phone market is a fragmented collection of wireless carriers, handset makers and other technology providers that need to work together to deliver closely integrated products and services and Microsoft made a rocky start.

"With carriers launching higher speed networks the business case for more advanced devices is starting to make more sense," said Hugues De La Verne, an analyst at researcher Gartner Group.

Microsoft's share of the mobile device software market is estimated at 16 percent to 18 percent, while Symbian is seen holding 61 percent to 71 percent.

Symbian, created in 1998, is half-owned by Finland's Nokia, as well as handset makers Siemens AG, Samsung Electronics Co. Ltd. and Matsushita Electric Industrial Co., which owns the Panasonic brand.

DECENT CHANCE

Redmond, Washington-based Microsoft said 40 hardware makers are shipping devices using its Windows Mobile software.

In the United States, however, phones running Windows Mobile, which Microsoft calls Smartphones, have been overshadowed by hot-selling devices such as Research In Motion Ltd.'s BlackBerry wireless e-mail devices, as well as PalmOS-based phones, such as the Treo.

Microsoft said Windows Mobile 5.0 would let e-mails pop up on a user's phone as they arrive. The software will also work with "push-to-talk" features that allow phone users to chat walkie-talkie style by pushing a button when they want to talk to another party.

Support for hard drives could also turn phones into multimedia devices that could store music and video, potentially taking the place of a separate cell phone and a separate digital music device, such as Apple Computer Inc.'s iPod music player.

Microsoft expects phones running the new mobile software to be offered by carriers within the next few months.

Faster speeds on cell phone networks also mean users will have better access to online e-mail, data and content that will provide a stronger incentive for them to upgrade to more advanced phones.