Palm Treo and Microsoft OS …

PalmSource takes hit on investment report | CNET News.com: “Shares of PalmSource, the handheld operating system developer, dipped Monday on an investment bank’s report that said key licensee PalmOne will use Microsoft’s OS in its Treo line of devices.
The research note from Needham & Co. said PalmOne ‘tacitly admitted’ it was working to make Microsoft’s handheld OS available on the popular Treo line of phones.”

Although still speculation, this is a very interesting development. The Palm Treo smartphone is a very successfull device for PalmOne. In combination with the Microsoft OS they can build a much larger footprint in the smartphone market is my guess.