Microsoft is finishing off the production of its first smartphone, a rumour has suggested. The smartphone is being prepared to be presented at the Mobile World Congress in Barcelona, and released to the market soon afterwards.

The software-giant's mobile device will run on nVidia Tegra processors, according to the rumour, which will provide 720p video playback and advanced 3D visuals. If so happens, the device is likely to be pointed towards multimedia capabilities, and not solely business use.

Windows Mobile's unfriendliness and business-phone look prompted phone-hardware manufacturers to produce their own User Interfaces, such as HTC with their TouchFLO. Microsoft should focus on the UI perspective in order to be successful with their possible device.

Microsoft's US$500m acquisition of Danger, the designer of the Sidekick, might have been one of the crucial steps in the company's venture to build its own mobile phone. Such device will not alter the industry or influence the market unless if contains a breakthrough feature, but it will be Microsoft's sign that its mobile-phone-software business is losing terrain against its competitors.

[Image: YankoDesign]

[via Electronista]