According to a WSJ report, Microsoft is developing a new Microsoft branded phone dubbed “Pink”, that will likely be powered by Windows Mobile 7, coupled with Zune, Marketplace, and My Phone services, among other services developed by the MS Danger team.

The device will exclusively support the features above; the features will not be available for licensing for other vendors who power their devices with Windows Mobile.

The report also indicates Microsoft is in talks with Verizon to launch the device exclusively in the U.S.

There is currently no other information relating to a possible release, pricing, features, or even what the device will look like.

The device is already being dubbed an iPhone rival.

The news comes as the exclusive AT&T iPhone contract expires in 2010, rumors are also circulating that the iPhone could also launch on the Verizon network, according to a USA Today report today. However, Verizon operating executive Dennis Strigl said today during a conference call the company is always talking with device makers but had no announcements today relative to Apple.

There are also reports that Apple could be developing another version of an iPhone in order to bypass the exclusive AT&T iPhone contract according to BusinessWeek.

Under the current AT&T contract, any Apple product called an iPhone cannot be sold with via any other operator in the U.S. The report indicates the new media centric Apple device could also make VoIP calls but would not be called an iPhone. The report says a possible release could come by the end of 2009.