updated 2/14/2006 12:07:08 PM ET 2006-02-14T17:07:08

Virgin Mobile became the first European cellular network to launch a live digital TV service on mobile phones, in a deal announced Tuesday with BT Group PLC.

The mobile operator — part of British entrepreneur Richard Branson's Virgin empire — will begin selling handsets equipped to receive the BT Movio digital television and radio services later this year, both companies said.

The launch was announced on the second day of the 3GSM World Congress in Spain, one of the world's largest mobile telecommunications trade shows.

Virgin and London-based BT also unveiled a new handset designed to deliver the service, offering one-click access to the digital TV and radio tuner.

"It's not downloaded, it's not looped," said Graeme Hutchinson, sales and marketing director at Virgin Mobile. "It's real TV just like you get at home."

Scores of exhibitors at the 3GSM trade show are showcasing mobile TV technology — which networks hope will unlock new sources of revenue and provide a return on their massive investments in third-generation phones and infrastructure.

Major U.S. cell-phone carriers have started TV broadcasts, and trials are underway in many countries around the world. Handset makers Nokia and Sony Ericsson announced a joint mobile TV development program on Monday.

Operators are upgrading their networks to cope with the increased demands of new services like video and music streaming and Internet browsing.

T-Mobile Chief Executive Rene Obermann told a news conference here that "mobile will progressively become the primary personal access to the Internet."

The German operator, owned by Deutsche Telekom AG, said Tuesday it will launch its first high-speed broadband service running at 1.8 megabits per second this quarter and hopes to increase connection speeds more than tenfold to 20 megabits per second by the end of the decade.

Also Tuesday, Microsoft Corp. announced a push to increase its share of the mobile software market.

Microsoft CEO Steve Ballmer on Tuesday announced a new mobile version of Communicator, an instant-messaging application, also offering Internet voice calls.

Microsoft’s Windows Mobile software trails rival Symbian in the market for smartphone operating systems, and Microsoft is trying to increase its share by leveraging its dominance in e-mail and calendar software for servers and PCs. (MSNBC.com is a Microsoft - NBC joint venture.)

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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