According to Jefferies & Co. analyst Katherine Egbert, Redmond is close to unveiling a Zune-like phone.

If Egbert's crystal ball is right, the phone should be showcased at Mobile World Congress or CTIA, meaning late February or March. Microsoft is expected to outsource production to another company, but Egbert's critics believe Microsoft will merely endorse Windows Mobile phones and it will not stick its own brand on a handset anytime soon.

Be as it may, we would love to see a Zune flavoured phone. We like the Zune HD quite a lot and we think it has a pretty good UI, coupled with Nvidia's promising Tegra architecture. Microsoft got burned with the first generation Zune, so it is probably still lacking confidence to have a go at the mobile market. This is not a bad thing, as it might wait a bit to develop a proper OS and UI for the device and won't launch a device that will be laughed out of the room by smug iPhone users.

More here.