Microsoft says it is now possible for Sidekick users to recover their contacts, feared lost after a server outage. It says it is making “solid progress” on recovering other data.

Microsoft says it will likely be able to restore virtually all the data lost in the recent Sidekick debacle. But while it insists that it’s going to improve the service, it’s probably too late to undo much of the damage to reputations.

T-Mobile is reportedly telling Sidekick owners they can walk away from their service contracts over the data loss debacle. It comes a day after the firm admitted it was extremely unlikely all users would get back data lost in the incident.

With Windows Mobile 6.5 launching today, manufacturers are unveiling their first handsets designed specially for the system. In the U.S. that includes three HTC models plus a new Samsung device.

Microsoft has confirmed that handsets running Windows Mobile 6.5 will be on the shelves Oct. 6. However, there are few specifics about how many models will be available at launch.

Microsoft has launched a platform aimed at bringing smartphone-style apps to basic cellphones. OneApp will allow Java enabled phones to run popular apps with just 30KB of space.

Microsoft has told mobile app developers their products are worth more than 99 cents. It’s a clear knock at the pricing structure of Apple’s App store.

Microsoft is to target both Android and the iPhone with its future Windows Mobile plans. The company will effectively have two different “latest” editions of its mobile software by the end of next year.

Verizon is to become the first network carrier to offer its own app store, which will be installed by default on the handsets it sells. Meanwhile Microsoft has announced it will drastically increase the audience for its own store by making it compatible with older editions of Windows Mobile.

It isn’t just the iPhone that has a bunch of free apps for you to enjoy, Windows Mobile also has a large selection of free games you can download to enjoy.