No matter how rigorously Microsoft Corp. denies it is not working on own-brand smartphone, the unofficial information about the product just keeps emerging. A new media report claims that the software giant had begun testing the design of its smartphone with component manufacturers.

The Wall Street Journal reports citing people familiar with the ongoing situation that Microsoft is working with component suppliers in Asia to test its own smartphone design. One of the sources even indicated that a prototype of a Microsoft smartphone has screen that is between 4” and 5” in diagonal. While the design is being investigated, it is not guaranteed that it will enter mass production.

Microsoft recently announced new strategy, which involves developing its own software and hardware that takes maximum advantages of software innovations. The first products that fit into the new business approach are Microsoft Surface media and business tablets. The head of Microsoft recently reaffirmed that more gadgets are incoming from Microsoft, but neither confirmed, nor denied the smartphone.

"We are quite happy this holiday [season] going to market hard with Nokia, Samsung and HTC. Whether we had a plan to do something different or we didn't have a plan I wouldn't comment in any dimension,” said Steve Ballmer, chief executive of Microsoft, in an interview with the WSJ.

In general, success of Microsoft-brand hardware varies greatly. The company has a popular lineup of PC peripherals and ultra-popular Xbox game console. At the same time, the history remembers ill-fated Microsoft Zune digital media players and Kin communicator phones.

Tags: Microsoft, Windows Phone