Microsoft’s Windows Phone 7 faces its first public hacking contest next week.

Security researchers and industry experts will be keeping a careful eye on next week’s 5th annual Pwn2Own competition. Contestants will attempt to break into a number of desktop web browsers for cash prizes and free laptops. However, this year contestants will also be encouraged to target Windows Phone 7. Organizers will have a base station on-site to allow competitors to perform attacks against cell phone base-bands. “Due to the sensitive nature of the vulnerabilities we expect and the fact that an attack would require the exploit to be transmitted over RF, we will have this nifty RF enclosure from Ramsey Electronics on hand for testing,” said a TippingPoint spokesperson.

Pwn2Own organizers plan to  record the hacking attempts across the following devices:

• Dell Venue Pro running Windows Phone 7
• iPhone 4 running iOS
• Blackberry Torch 9800 running Blackberry 6 OS
• Nexus S running Android

The competition rules state that a successful attack against any of the devices must require little to no user interaction and must compromise useful data from the phone. “Any attack that can incur cost upon the owner of the device (such as silently calling long-distance numbers, eavesdropping on conversations, and so forth) is within scope,” according to the rules. A successful hack of any of the devices will win the contestant $15,000 and the device itself. TippingPoint has published time slots for various teams to attack the devices and one surprise is the inclusion of George Hotz, known to many as Geohot.

Geohot joked on his personal blog in January that he planned to purchase a Windows Phone 7 device and immediately caught Microsoft’s attention. Brandon Watson, Director of Developer Experience for Windows Phone, posted a tweet promising a free Windows Phone if Hotz wanted to “build cool stuff on #wp7″. Hotz and two other teams named Team Anonymous and Anonymous_1 will attempt to break into the Dell Venue Pro running Windows Phone 7 next week. Geohot is known for his ability to jailbreak both the iPhone and PlayStation 3. Hotz is currently being pursued by Sony who sued him over 8 counts of DMCA violation. We’ll have to wait until next week to see if he is successful, but given his past success there’s a good chance that Windows Phone could be compromised.

Update: Pwn2Own has informed us that Geohot has backed out of the contest to “devote time to the Sony lawsuit”. Other individuals will still attempt to hack Windows Phone 7 however.