Forget Chrome OS versus Windows (for now), there’s another Google / Microsoft battle taking place right in front of our eyes and Google’s winning. No, I’m not talking search. That war is over and Google was victorious a long time ago. I’m talking mobile. Android versus Windows Mobile to be precise, where Redmond is looking a little vulnerable to say the least.

Tech pundits like to talk endlessly about how Apple’s iPhone has shaken up the industry and that’s undeniable. But Android is a slow burner — don’t get fooled by the pig of a phone that was the T-Mobile G1 — the Google-led mobile OS is only now beginning to show its true potential. It’s not that consumers are flocking to Andriod — yet — it’s that handset makers right across the board are. And prior to Android, many of those handset makers were more than willing participants in Microsoft’s Windows Mobile eco-system. Less so now.

It’s been reported that HTC, the biggest manufacturer of Win Mobile devices, will by end of 2009 have moved 30% of its device lineup to Android, and by 2010 around half of new handsets released by the company will be powered by the Google-led OS. Part of the reason is that Android is free to license unlike Windows Mobile in which Microsoft gets a kick back for every phone sold. And part of the reason is the flexibility of the OS itself.

When I reviewed the HTC Touch Diamond, a flagship device at the time, I gave props to the company’s attempt at putting a more friendly consumer-oriented User Interface on top of the dated Windows Mobile but noted the limitations of this approach. Instead, I suggested that HTC would be better off looking for a new OS partner or building one of their own. Android was my recommended solution.

Almost a year on and it seems that the Google-led OS does indeed address the needs of HTC: A solid and free foundation on which the company can build on top to differentiate itself from the rest of the market through software and the User Experience.

Here’s what Horace Luke, the Chief Innovative Officer at HTC, told T3 upon unveiling the HTC Hero, its most customized Android device to date:

Android is very flexible. Windows Mobile was great with development tools, it can do lots of powerful things. But Android allows you to make changes from the top to the bottom layer.

There are three classes of Android phone: the first was the Google-branded phones, the G1 and Magic; the Hero is the first in the second category, in which we added our own customised UI, but we didn’t change everything because they did some great things, like push email, integrating Google Maps etc; and the third is the quick and dirty Chinese knockoffs that won’t work with Marketplace. They’re Linux phones, really…

The hardware is only a small part of the user experience, the UI brings it alive.

And it’s not just HTC that is seeing the potential of building a custom user interface on top of Android’s strong ‘out of the box’ foundations. Sony Ericsson is set to bring an Andriod-powered device to market under its previously Windows Mobile ‘Xperia’ brand, custom UI and all.

Android, HTC, Windows Mobile