The xda II, which combines a mobile phone with a PDA, will be available in the United Kingdom, Germany and Ireland before the Christmas season, the company said.

The new device will run Microsoft's latest Phone Edition of Windows Mobile 2003 for Pocket PC and will include a 400MHz Intel XScale processor, built-in digital camera, multimedia messaging service (MMS) capability, integrated Java technology and a 65,000-color display.

O2 said the triband phone will offer optional wireless local area network (WLAN) capability and Bluetooth. Business customers will be able to access O2's xmail service, which provides remote access to e-mail, calendar and contact info, as well as Microsoft Mobile Information Server and Extended Office.

More than 64,000 xda devices have been sold in U.K., Germany, Ireland and Asia to date, according to O2. The xda is currently available from 299 pounds in the U.K. and 499 euros in Germany. Pricing of the xda II was not available.