Digitimes, a Taiwanese tech news site reports that Foxconn International Holdings Limited (HKG:2038), a subsidiary of Foxconn Electronics has received orders to manufacture handsets for Microsoft Corporation (NASDAQ:MSFT) and Amazon.com, Inc. (NASDAQ:AMZN).

In the past few months, ever since Microsoft introduced the Surface, rumor had it that Microsoft Corporation (NASDAQ:MSFT) and Amazon.com, Inc. (NASDAQ:AMZN) could both launch their own smartphones in the near future but no confirmation had arrived from any of the top executives from both the companies. This report, however, seems to point at that fact that Microsoft might already be on its way to manufacturing its own handsets.

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DigiTimes claims that the handset manufactured by Foxconn International Holdings Limited (HKG:2038) would feature Windows 8 OS and are scheduled for a release sometime in mid-2013.

“Foxconn International Holdings Limited (HKG:2038) has reportedly landed handset orders from Microsoft Corporation (NASDAQ:MSFT) and Amazon.com, Inc. (NASDAQ:AMZN) and is set to launch the devices in mid-2013, according to sources from the upstream supply chain. However, both the parent company Foxconn Electronics (Hon Hai Precision Industry) and FIH declined to comment about clients or orders. Foxconn is the major manufacturer of Apple’s iPhone products, while its subsidiary FIH has clients including Nokia, Sony, Lenovo, Huawei and ZTE. Microsoft’s own-brand handset will adopt its Windows Phone 8 operating system, the sources noted.”, reports Digitimes.

The rumored device, referred as the ‘Surface phone’ is likely to mimic the design and functionality DNA from Surface tablet. The news however is yet to receive a direct confirmation from Microsoft spokesmen.

The Asian report also discusses that Amazon might also be working on releasing a phone that is likely to hit the market at around the same time when Microsoft Corporation (NASDAQ:MSFT) schedules to launch its handset. A report by The Wall Street Journal states that, “Officials at some of Amazon’s parts suppliers, who declined to be named, said the Seattle-based company is testing a smartphone and mass production of the new device may start late this year or early next year.”

It is however unclear from the Digitime report whether Amazon.com, Inc. (NASDAQ:AMZN) would launch its smartphones under Microsoft brand or under their own brand as Amazon devices. The report also comments on the fact that all smartphone makers will be competing in an expanding market for the products next year. If this surge continues to rise, the global smartphone shipments is forecast to rise by 30 percent in 2013 to 865 million units, representing 43.9 percent of all handset shipments.