The wrapping comes off Microsoft’s WP7

Microsoft unveiled a new mobile phone operating system on Monday as it seeks to regain ground lost to the iPhone, Blackberry and devices powered by Google’s Android software.

Microsoft chief executive Steve Ballmer introduced nine mobile phones powered by Windows Phone 7 (WP7) at an event at a loft in New York’s Chelsea neighborhood.

The event proceeded smoothly, with no major glitches happening, and seemed to be well received by the attending audience. First impression is that the OS seems to be pretty well integrated into social media, Microsoft Office and third party applications.

Ballmer said more than 60 mobile operators around the world will offer the devices, made by South Korea’s Samsung and LG Electronics, Taiwan’s HTC and Dell, the US computer giant, in more than 30 countries.

WP7 seems to integrate nicely with X-Box Live and will be launching with EA Games in November.

Voice recognition is set to play a central role with the “Tell Me Service”, where you can ask a question verbally and the OS uses Bing search to find results.

Another impressive feature was the integration with Microsoft’s flagship music player, Zune, allowing 3rd party API integration into the Zune player.

“We have built a different kind of a phone,” Ballmer said. “We set out to build a phone that was thoroughly modern.”

US telecom carrier AT&T showed off three devices which will sell for around US$200 in the United States, about the same price as Apple’s iPhone.

Another US carrier, T-Mobile, will offer two WP7-powered devices in November.

WP7 is Microsoft’s first significant update to its mobile operating system in 18 months and its release comes on the heels of the disastrous launch of a “Kin” line of phones, which were pulled from stores after just two months.

Negative comments centered on the fact that the screen looks to be a little too small, and that cut-and-paste functionality will only be added in 2011.