Microsoft, LG Team Up For SmartphonesMicrosoft, LG Team Up For Smartphones

Microsoft and LG Electronics on Monday inked a deal for strategic collaboration on the next generation of mobile devices.

The agreement ensures that the two companies will work together on research and development, marketing, applications, and services for mobile convergence devices.

"This agreement between LG and Microsoft will create critical momentum in the industry," said Yong Nam, LG's CEO, in a statement. "With this partnership, mobile computing will truly become an everyday reality, and LG and Microsoft will be at the forefront of it."

For Microsoft, the deal could give its Windows Mobile operating system a strong ally in the competitive smartphone landscape. The Symbian OS is currently the world's dominant leader with nearly 60% of the market, and the operating system will soon be going open source to try and retain that market leadership.

Research In Motion's BlackBerry operating system is the second-most-used mobile operating system, and the company will soon release some high-profile handsets like the BlackBerry Bold and Storm that are sure to draw some new customers.

Microsoft's mobile operating system has been in third place for the last few years with about 12% of the market, but it has struggled to significantly increase its foothold. Windows Mobile also is facing increased competition from Apple's iPhone handsets, as well as Google's open source Android operating system.

For LG, the move is a strong affirmation that the company wants to compete in the smartphone market. The electronics company has released a few smartphones, but is mostly known for entry-level device and feature phones like the Venus and Voyager.