Microsoft's in-car technology is getting a boost via a deal with a large supplier of automotive electronics. Germany's Siemens VDO Automotive has agreed to collaborate with it on a next-generation communication and entertainment system.

Siemens VDO and Microsoft said Friday they will work together to develop a new generation of on-board communication, navigation and entertainment systems that use Microsoft Auto, a software system and hardware reference design. Siemens VDO counts Volkswagen, DaimlerChrysler and Ford Motor Co. among its customers.

Among the features planned by the two companies are in-vehicle video entertainment and Internet connectivity, according to Siemens VDO spokeswoman Eva Appold.

Systems based on Microsoft Auto let drivers connect various portable devices, such as mobile phones, MP3 players and video games, into their automotive system via a USB 2.0 (Universal Serial Bus) port, and interact with devices via voice technology.

The new multimedia system planned by Siemens VDO, to be available in early 2009, will be based on hardware components and software developed by the German company, and include entertainment and communication components of Microsoft Auto, according to Appold.

Siemens VDO, a subsidiary of German electronics and engineering company Siemens, plans to show a prototype multimedia system at the IAA (Internationale Automobil Ausstellung) international motor show in Frankfurt next week.

"The multimedia platform will be very versatile, but it's up to our car manufacturing customers to decide which features they want to offer," Appold said.

Appold was unable to provide pricing details, saying that final prices will be determined by the car makers.

As part of the agreement with Microsoft, Siemens VDO will contribute to the further development of Microsoft Auto, the companies said.

Microsoft already has agreements with Ford and Fiat SpA to supply software for new in-vehicle communication and entertainment systems designed by the car makers.