BT yesterday further strengthened its partnership with software group Microsoft and leading US telecommunications group AT&T to win a third generation mobile telephone licence.

BT already has a software deal with Microsoft's Genie which sends data such as football scores and share prices direct to mobile phones, and an international roaming alliance with AT&T.

BT is also developing and trialling a third generation mobile network on the Isle of Man. The government is auctioning five mobile phone operating licences and yesterday BT was one of seven bidders making an offer of £1.55bn for one of those licences.

But the alliance is to go deeper, with the three companies working together to develop new applications for the consumer and business mobile markets.

While the applications are targeted at third generation mobile phones some will be deployed on existing services.

Sohail Qadri, director of BT mobility, said: "Applications are key to customers. By working with AT&T Wireless and Microsoft we will provide our customers with advanced, innovative and higher speed mobile internet applications, giving them true multimedia capability while on the move."

None of the firms would reveal the level of their investment in mobile applications.