Microsoft is rumored to design a phone based on NVIDIA’s APX chip (codenamed TEGRA). Microsoft might have realized the benefits of having a tight control over the hardware, OS and applications when they see how Apple is pulling it off. The Xbox division has been doing this quite successfully too.
NVIDIA has clearly said that they were focusing on Windows Mobile only at the moment. I suspect that this comes down to how many platforms the internal software team can support.
I would not be surprised if Microsoft was indeed building a phone based on “Tegra” as it is the most powerful chip that one can get for a mobile. I suspect that NVIDIA has already won a bunch of design wins in Windows Mobile apps such as GPS navigation, in -car entertainment and upcoming Portable Media Players (PMP).RELATED