Microsoft will be releasing transliteration tools for 6 Indian languages:

Making computers accessible for those who don’t know English, Microsoft Corporation has said that it would soon release transliteration tools for six Indian languages – Tamil, Telugu, Hindi, Bengali, Kannada and Malayalam.

These tools allow the users to key in the language words in phonetic way using the English script and get the text in their respective languages.
Source: Microsoft tool to break the language barrier

Perhaps a bit of competition for Google's transliteration tool?