Photo: PocketLint Microsoft makes big splash at the 3GSM World Conference in Cannes by announcing the Peabody mobile phone hardware.

Microsoft and Flextronics announced Peabody, a GSM/GPRS mobile phone platform based on Microsoft Windows Mobile. Available only to Original Equipment Manufacturers (OEMs), Peabody is a low-cost, feature-rich Original Design & Manufacture (ODM) platform developed by both companies.

As a Window Mobile-based device, The Peabody mobile phone platform offers OEMs access to more than 18,000 applications for product line customization.

So you will not see a Microsoft branded phone, but you will see most likely tons of low-cost Windows Mobile Phones based on Peabody soon. The Peabody based mobile phone comes off a bit cheap looking from the photo. Especially the scroll-wheel looks one taken from a $5 mouse. I hope OEMs can choose a different casing.
More details in Microsoft Press-Release.