Microsoft says new phone software closer to Windows 8 SEATTLE (Reuters) - Microsoft Corp announced the latest version of its smartphone software called Windows Phone 8 on Wednesday as it looks to beef up its challenge to Apple Inc's iPhone and Google Inc's Android devices. The world's largest software company said Windows Phone 8 would share core code with its forthcoming Windows 8 computer software, which means more devices and applications will be available for its phone users. Windows 8 -- which is optimized for touch and will work on tablets -- is expected to be introduced around October, but Microsoft has not set a firm date. Microsoft did not say when the new phone software, codenamed 'Apollo', will be released, or discuss any new features at an event in San Francisco. Microsoft has invested billions of dollars in an attempt to crack the phone market, which many see as key to the future of computing, but is still a minor player. The company had only 2 percent of the world's smartphone market last quarter, according to tech research firm Gartner. Google's Android leads the market with 56 percent, followed by Apple with 23 percent. Microsoft has signed a deal to supply the software for Nokia phones in an attempt to increase sales. Reporting By Bill Rigby; Editing By Leslie Gevirtz