FORTUNE — As predicted, Microsoft (MSFT) took the wraps off its next generation smartphone strategy Wednesday at the Windows Phone Developer Summit in San Francisco.
With Apple (AAPL) expected to introduce a new iPhone in conjunction with the scheduled release of iOS 6 this fall, the stage is set for a holiday face-off between these two long-time rivals in the battle for second place after Google’s (GOOG) market-leading Android smartphones.
Once again, Microsoft will be trying to stretch its lead on the desktop by taking a version of Windows into the mobile device marketplace. Apple, meanwhile, will be playing into its strength in devices that operate smoothly together in an easy-to-use software ecosphere.
To the relief of its hardware partners — some of whom were taken by surprise by Microsoft’s tablet announcement Monday — Redmond will not be building its own smartphones. It’s leaving that to the likes of Nokia, Huawei, Samsung and HTC.
But those partner-built phones will be packed with new Microsoft-supported features, among them:
- A new customizable home screen
- Maps with turn-by-turn driving directions and real-time traffic conditions
- Voice control search functions
- Voice over Internet Protocol integration (not just Skype)
- A SIM-based electronic “wallet” for making purchases via NFC (near field communications)
That last item gives Microsoft an edge over both Android and iOS — at least for now. Android offers NFC functions, but they haven’t been widely adopted. Apple, for its part, has yet to provide near-field communications in any of its mobile devices, nor has it said anything one way or the other about building NFC into the next iPhone.
But Apple has a lot of momentum, including a significant lead in mobile software. There are more than half a million apps in Apple’s App Store and only about 100,000 in Microsoft’s. Moreover, nearly all of those Windows Phone apps will have to be rewritten to run on Windows Phone 8 — a process Microsoft worked hard at Wednesday’s developers summit to sound as painless as possible.
Meanwhile, early adopters who bought Windows Phone 7 phones — like the Nokia Lumias — are left without an upgrade path. They will, however, get some of the new features — including the new desktop — in a release called Windows Phone 7.8.