Microsoft and chip designer ARM have announced a new licensing agreement. But don’t read too much into that. It doesn’t mean that Microsoft will be building hardware with ARM-based chips. The companies have had licensing deals int he past, which allowed Microsoft to develop software such as Windows Mobile and Windows Embedded to run on ARM-based devices.

The new agreement apparently extends the relationship, but Microsoft and ARM aren’t really spelling out the details. ZDNet’s Mary Jo Foley is making an educated guess that we could finally see Microsoft port a full Windows operating system to run on ARM.

But it’s also possible that we could see tablets and other devices running Microsoft’s upcoming Windows Phone 7 operating system or simply an optimized version of the new Windows Embedded Compact 7.



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