Microsoft promises to release Windows 8 in 2012

Speaking at the Microsoft developer conference in Japan, CEO Steve Ballmer announced that the Windows Phone 7 mobile operating system will receive over 500 new features with the Mango update.

He also announced that a slew of new Windows Phone OEMs and carriers will be revealed at the May 24 'Windows Phone' event, according to NDTV.com.

"We're obviously hard at work on the next version of Windows... We have a brand new user interface. We've added touch, and ink, and speech. And yet, as we look forward to the next generation of Windows systems, which will come out next year, there's a whole lot more coming," said the MS boss, report Register.

Analysts have remained sceptical at Windows Phone 7's ability to crack a market dominated by Apple and Android. Google recently reported that 100million Android devices had been activated. Microsoft's deal with Nokia, however, may give it a new advantage.

Eldar Murtazin, an analyst who was among the first to identify Microsoft's intention to do a deal with Nokia, has said that although Microsoft has shipped 1.5 million phones to partners, approximately 900,000 of those remain unsold so far, says Telegraph.co.uk