Microcell's and Siemens' decision is a milestone for Ericsson Mobile Platforms, which was spun out from Ericsson over a year ago to offer turnkey solutions to handset vendors.

The announcement indicates that even major mobile handset vendors, pressured to expand their portfolios, are scrambling to get help from design manufacturers. Microcell predicts that about 25 percent of the 400 million mobile phones shipped to the global market this year will be made by original design manufacturers (ODMs), up from about 20 percent last year, the company said.

Armed with an R&D facility in Oulu, Finland and manufacturing site in Nanjing, China, Microcell has expanded its net sales more than tenfold to $171 million in the first nine months of this year over last year, a company spokesman said. Microcell, which employs 670 people, has attracted a growing number of wireless communications engineers in Europe and the United States, the spokesman said. "Unlike other ODMs, we are only focused on the wireless technologies," he said.

Chip makers Texas Instruments Inc. and Philips Semiconductors are main suppliers to Ericsson Mobile Platforms. Microcell said it is designing a user interface for Siemens' upcoming 2.5G phones, but declined to say whose chips will be used in Siemens' new mobile phones.

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