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"Fifty percent growth is the minimum," says Eddie Wu, the software company's managing director of OEM embedded devices Asia.

Microsoft expects to sell 20 million units in the fiscal year ending in June, far higher than the previous year's 11 million.

"We're actually still seeing very good growth (for our mobile software) in markets like Europe and the United States," says Wu, adding that growth of Windows Mobile has been fastest in the emerging markets of Asia, the Middle East, Brazil, Russia and India.

Microsoft's mobile communications

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division provides operating systems for smartphones and other mobile devices based on the Windows Mobile platform. Its clients include Samsung, Motorola, HTC and Asus.

The company competes in this market against Symbian-based operating systems used by vendors such as Nokia and LG Electronics.

It also faces stiff competition from other players such as Apple, Blackberry maker Research in Motion and Palm.

"Even if Microsoft is growing at a rate of 50-60%, it doesn't mean they can gain that much share since Microsoft and Apple's mobile operating system is still much smaller compared to the Symbian system," says Citigroup analyst Kevin Chang.

"But they are one of the few players which are offering touchscreen platforms so that is helping them grow," he continues, adding that vendors such as Sony Ericsson may soon also launch touchscreen smartphones based upon Windows Mobile.

Global smartphone unit shipments grew by more than half from a year ago to hit around 12 million units in 2007, based on data by Gartner, and the market is set to continue to increase in high double-digits in 2008 and in 2009, analysts expect.