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'We're responding to our wireless partners around the world who are asking for a solution to enable new scenarios in the industry,' said Kevin Johnson, Microsoft's co-president of the Platforms & Services Division. 'We want to give consumers what they want - seamless experiences with premium content on a wide range of mobile devices.'

The move is a logical next step for Microsoft. Around 800 million handsets are now being sold around the world every year. Increasingly, the devices are being equipped with the capability to receive streamed

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video while broadcasters and film studios are looking at what Microsoft is calling 'a largely untapped market'.

Already a number of companies are trialling TV to mobile services around the world with launches expected this year.

The big problem is digital rights management. While it may seem absurd to be worrying about whether a mobile phone or PDA can illegally transfer and save bootleg copies of the latest Hollywood blockbusters. Despite a lot of opposition, Microsoft Windows Media Digital Rights Management (DRM) is becoming a standard for PCs and related devices such as 'Play for Sure' compatible MP3 players.

The company claims that its DRM has been licensed and deployed by more than 100 content services and on hundreds of devices that support a range of business models such as download and play, subscription, and video on demand.

Microsoft now looks to be able to allow handset manufacturers, wireless telcos and content providers to deploy these services when phones can receive data in the megabyte per second range, and have capacities measured in gigabytes - something most iPods already have.