AT&T, T-Mobile unveil messaging phones

The new 'Pantech duo' global smart device which runs on Microsoft Corp's mobile phone operating system is displayed in its various dual-keyboard configurations as AT&T, Microsoft and Pantech announce the new crossover mobile phone availability at an AT&T retail store in New York, October 29, 2007. AT&T Inc, the biggest U.S. mobile service said on Monday it will sell a new handset from Pantech Co aimed at customers who like to send e-mails or text messages.

NEW YORK (Reuters) - The largest U.S. mobile service provider AT&T Inc and smaller rival T-Mobile USA revealed new handsets on Monday to attract a growing number of consumers who like to send e-mails or text messages.

The companies are bolstering their phone ranges in time for the holiday shopping season, competing with other smartphone makers such as the Blackberry's Research in Motion or the Treo's Palm Inc.

AT&T said its new Pantech "duo" runs on Microsoft Corp's mobile phone operating system and has a miniature computer-like keyboard, as well as a standard phone keypad.

T-Mobile USA, owned by Deutsche Telekom, unveiled the Shadow, made by Taiwan's High Tech Computer and also running Microsoft's software. It has one keypad that includes both phone and text symbols.

T-Mobile USA said it hoped to attract consumers who may not have used e-mail on their phone before with a $149.99 price tag and a simpler version of the Microsoft software. For example, users could dial friends directly from the phone's home screen instead of scrolling through menus, T-Mobile USA said.

AT&T, which is charging $199.99 for the duo, said it expects the Pantech phone to appeal to both executives and teenagers, more of whom are turning to phones with computer-like features.

"That category of device is growing faster than any category we have," Kent Mathy, president of AT&T's business markets group, said in an interview.

The smartphone market is forecast to increase to about 6 percent of the 160 million handsets expected to be sold in the United States 2007, up from a 5.8 percent share in 2006, according to Yankee Group analyst John Jackson.

SHADOW VERSUS DUO

Current Analysis analyst Avi Greengart said Shadow's simpler interface would likely appeal more to young people than the duo, whose dual keypad could attract business users.

"This will appeal to people who've been told they need a Windows mobile device but want a more consumer friendly form factor," he said. "Where duo's crossing over is between business and personal use, not between executives and teenagers."

Both phones enter a market that also include the Ocean, a Pantech device with two keypads sold by small service provider Helio, a venture of EarthLink and SK Telecom.

Verizon Wireless, the venture of Verizon Communications Inc and Vodafone Group Plc, and Sprint Nextel Corp, which has been losing market share, have also revealed new handsets for the holiday season.

Mathy said AT&T has more new devices to launch before the November 22 Thanksgiving holiday, considered to be the start of the holiday shopping period. He did not give details.

Unlike Apple Inc's iPhone -- already a key product for AT&T this year -- the Pantech duo, which went on sale Monday, runs on AT&T's high-speed network.

T-Mobile, which has yet to upgrade its cellular network for fast Internet services, has included Wi-Fi in its device.

The gray Pantech phone has a relatively big screen for Web surfing and a standard phone keypad that slides out from under the bottom of the phone and a so-called "QWERTY" keypad that slides out from under the side of the phone for e-mailing.

Both AT&T and T-Mobile prices apply to customers who sign up for two-year service contracts.

South Korea's Pantech had its shares delisted in April as the company under-went a credit-led restructuring. It trails bigger Korean rivals Samsung Electronics and LG Electronics Inc and has suffered from stiff competition from Nokia Oyj.

Pantech's chief marketing officer Jay Yim said because the company had pulled out of markets such as India and parts of Europe, it would have lower unit sales this year than its 15 million phone sales in 2006.