“In the last quarter, the iPhone and Research in Motion (maker of the Blackberry) overtook Windows Mobile, while Nokia remains comfortably in first place in smartphones. At the end of the June quarter, Microsoft had to admit that Windows Mobile missed it self-set target of 20 million by 2 million,” Tim Nash writes for Low End Mac.
“In today’s mobile market, Microsoft is already outpowered by Apple’s financial returns,” Nash writes. “Last quarter Apple sold 6.9 million iPhones at an average price of over $650. With a margin of over 50% (analyst Charles Wolf of Needham & Co), this generates gross profit of over $2.2 billion. In the year up to June 30, Microsoft sold 18 million Windows Mobile licenses for $8-15 per license (Strategy Analytics) for a maximum of $270 million. With RIM reporting gross profit of $1.3 billion and Nokia selling 15.5 million units (mainly N series and E series) in their respective last quarters, Microsoft is falling more and more behind just as the market is expanding.”
Nash writes, “Windows Mobile 7 has been delayed. HTC, the Android G1 manufacturer, expected to release a WM7 handset in Q1 2008. Now the next release will, in the words of longtime Microsoft follower Paul Thurrott, “allow smart phones to render Web pages like they did almost a decade ago on traditional PCs”. The interim version after that looks as though it will ship in late 2009 (ZDNet’s Mary Jo Foley). It looks like too little too late. The iPhone will be through the annual update by then, and the App Store will be closing in on or already past 1 billion downloads.”
Full article here.
Well, Surur, you may list all 100 features that may be missing on the iPhone, but one thing clearly flies in the face of such statements: 6.9 million devices in one quarter.
Oh, and for the alleged 2 million unsold (this is an estimate of one analyst, who has a verifiable slanted track record towards MS), most analysts agree that Apple’s inventory is between two and three weeks. Therefore, the two million devices in the channel are already long gone.
We haven’t seen what was the ‘stuffed channel’ component of those ‘sold’ Blackberries as reported by RIM, but I wouldn’t be surprised if the number was higher, with Apple being famous for its extremely tight inventory control, and RIM not being exactly famous for it…
The unprecedented growth rate of the iPhone (as well as the AppStore sales) clearly demonstrates that Apple nailed the feature set right on the head. Providing bullet point list of features to print on a box is meaningless; my wife has a Sony-Ericsson that has MP3, FM radio, built-in flashlight (with an
Truncated post…
continuing from above:
… built-in flashlight (with an ‘SOS’ blinking mode), voice dialing, 2-megapixel camera with video recording, e-mail, WAP browser, java games, etc, etc, etc. She only uses it to make and receive calls.
Once she receives her first iPhone, she’ll manage her music, photos, podcasts, surf the web, check and send e-mails, take pictures and without ever asking me for help. She is an intelligent and well-educated woman, but has no desire to torture herself with having to figure out a counter-intuitive user interface that periodically crashes.
That’s the difference betwen your WinMob and iPhone. I’m sure you are fine with it and have no problem restarting the phone when it freezes or crashes. The innocent unsuspecting masses have no patience nor understanding for that. They want intuitive, simple and reliable. So far, only iPhone has been offering that.
@Predrag
That the iPhone has a feature set that appeals to to the less demanding user is not in doubt. Remember many more Razr’s were sold in the same period.
Some people actually want to do more. At least 18 million between June 2007 and June 2008.
Also, when using sales figures for evidence, just recall that Vista probably outsold OSX many times over.
@Predrag second comment.
iPhone users should be careful to sling stability accusations at Windows Mobile. I have seen large polls at macrumors where it says at least 1/3 of iPhone owners reset their device daily.
Give Surur his/her due … all statements are correct and stated without undue emotion. Now, that doesn’t mean they are “right” or that they apply to you, just that they are “correct”. Many people can be quite happy without the features listed as missing. I certainly can – those and more. But some folks can’t. Some folks need, or feel they need, one or more of them. Even WM is better for those folks than the iPhone. Other folk, with different needs, would find only the iPhone acceptable. This isn’t a zero-sum game where we must all choose a single device and live with it, it’s a game where we get to choose based on our own needs.
Also, when using sales figures for evidence, just recall that Vista probably outsold OSX many times over.
1. MS gets the DOS OS monopoly handed to them by stupid IBM.
2. Apple creates the Macintosh GUI, and Steve Jobs hires John Scully from Pepsi to help sell more computers.
3. Scully has Jobs booted from his own company and Jobs goes off to form NeXT.
4. Scully stupidly gives MS the keys to the GUI kingdom for free, which MS then a few years later use to create Windows, and steal the Mac business away from Apple. Scully’s Apple continues to coast on past accomplishments and fails to significantly innovate the Macintosh created by Jobs.
5. Apple after years of mismanagement and losing money hires Jobs back to repair the damage caused by Scully, and his successors. And save Apple from collapse and ruin.
6. Jobs and Apple spend the next 10 years refining NeXT into OS X. Comes out with the iPod, iTunes Music Store, and the iPhone and redefines multiple areas of technology and culture.
7. MS comes out with XP in 2001, and stops innovating, and starts co
Surur “Also, when using sales figures for evidence, just recall that Vista probably outsold OSX many times over.” should have quotes around it.
Sorry Surur.
The numbers in the article make it clear that Apple needs to separate it’s hardware from it’s software, so that it can earn $10 of profit per cell phone instead of $250 per iPhone. Because Apple would sell WAY more licenses of iPhoneOS than they ever could of just iPhones.
Apple’s long-time strategy (since its founding in the 70’s) of close software and hardware integration is now paying off big time. It’s incredible how much Apple make per iPhone sale versus how little Microsoft makes per Window Mobile license.
Is it just me,,,,,or is it MS trolling season.????? LOL
—More copies of Vista sold (90 % trashed and XP installed).
— Apple could sell more licenses for iPhone OS than phones. (Hey that never worked for anyone else, but you want Apple to do it???)
—–more features, (including everything you will never use, just so you can advertise it) Hey my friend has a PC and only manages to use 1 percent of its functions, then they gave the machine away and bought a new one….. cause it was cheap..
There are all kinds of people out there so MS will be around for a while. Honestly, they sell tons of stuff. But the sell most of it cause they have this preceived monopoly. It must be good cause many others are buying it. But cheaper wins only at being cheaper. Cheaper means minimal margins/profit.
Apple is bigger than Dell or HP yet sells less computers… and has less service calls, less warrenttee issues, etc.
———- sorry. I keep trying to put lipstick on a pig…
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Buy what you like. Put up with what you buy.
Just a thought.
en
“Also, when using sales figures for evidence, just recall that Vista probably outsold OSX many times over.”
And how many of those actually came delivered with XP installed instead? To quote from the last article: “In essence, the user is buying a Vista license that it can apply to XP, and Microsoft can still claim a Vista sale,” Schwartz reports.
Forget VIsta: Beleaguered Dell brings back Windows XP, people also asking for Mac OS X
Microsoft’s Windows Vista dog slow; even outperformed by ancient XP
PC World names Biggest Tech Disappointment of 2007: Microsoft’s Windows Vista
Microsoft extends Windows XP sales until June 2008 after Vista backlash
<a > Desperate Microsoft to count Windows XP sales as Vista sales</a>
Sorry last link is:
<a >Desperate Microsoft to count Windows XP sales as Vista sales</a>
Wow, that vista statement must have hit a sore point. If you go to hitlinks, which presumable measures installed base, Vista is now 20% of computers measured, up from 10% a year ago. Given that there is about 1 billion pc’s out there I suspect MS sold quite a few vista licenses, and that the vast majority are being used as is.
http://marketshare.hitslink.com/report.aspx?qprid=11
ps: I just cut and pasted that link using my Touch Pro btw.
we read you right the first time. second post was unnecessary…
@dave,
Good points, but that’s always been part of the dig with Apple’s OSes, it takes real hardware to run them, and not just memory. Name one “smartphone” currently in existence that could run the current iPhone OS at least as well as the iPhone. There may be one, possibly, that has the raw power, but then screen design and real estate are also part of the equation, along with other hardware configuration and ergonomic issues.
Now stop and think about how well the current state of making software and hardware by two totally different entities has been working so far – uh, not – basically. Bottom line, mediocre hardware and unnecessarily mysterious OSes result as the two entities chase each other around constantly second guessing one another. Dell just wants to make a laptop that’s stupidly cheap, and expects MS to put out an OS that will run on it. MS wants to dictate hardware specs, but is just smart enough not to shoot themselves or their hardware partners in the feet, having unwittingly developed a great system where I get a computer for an initial $300 bucks, and within the first month will be back to buy more ram, and faster motherboard, etc. and etc. And that will just be to get the thing to run smoothly. If I want to upgrade to a higher level of Windows whatever, I’m going to be rebuying my OS and hardware, (or buying so many upgrades that it would be cheaper to just buy another one – And probably cheaper overall to just get a Mac), and all of that within the first six months of my initial purchase.
See, Apple gets it, and MS, Dell, et. al. all know that Apple gets it, but they’ve got us and themselves, by now, locked into this perpetual purgatory of recycling crap that doesn’t even really try to be a good value – just cheap. It’s not a huge leap to understand why, in part, Apple keeps their hardware and software technology close to their chest, and together [hardware/software].
Apple wants to sell computers and they want people to keep coming back for more because their computers: laptop, desktop, handheld; provide a better end-user experience and a product that, overall, lasts longer out of the box. In a word, Quality.
Paul Thurrott, “allow smart phones to render Web pages like they did almost a decade ago on traditional PCs”.
Yeah buddy! WinMo7 will finally bring an IE 5-like experience to the Touch Pro. How long will it take before they’ve achieved the marvel and wonder that is IE 6?
Shouldn’t smirk. They’ll eventually get to where the puck used to be.
@Mac Tramp
Until the iPhone browser gets cut and paste, not even to mention flash, I would not be so snooty.
The fact is that Windows Mobile already has a better browser than Safari on the platform, will soon get Mobile Firefox, and will get an IE6-equivalent browser with Flash 9 compatability soon.
The fact is also that on the iPhone there will never be this choice.
Macphiles tend to be snooty yes, but if Firefox and Flash are your idea of cutting edge technology then stick with Windows. I personally don’t care if they ever make it on the iPhone. Windows problems are created by itself. Some newer ASPX pages don’t even work correctly in IE6. Cut and paste will come when the security is protected correctly. I’ve had lots of managers who admired the ease of use of the iPhone. I’ve never heard one of them being proud to own a BB because it’s got cut and paste.
“I’ve never heard one of them being proud to own a BB because it’s got cut and paste.”
Why would one be proud to own a phone? With the iPhone being one of the cheapest smartphones its not even a status symbol anymore.
I expect when the situation arise when an iPhone and a BB user both need cut and paste, and the iPhone user can not use it, the iPhone user will not feel proud, but rather stupid. This is true for many of the other basic features the iPhone lacks.
Example – an iPhone user was quite upset recently because they could not forward a text message. Every other phone can, the iPhone cant. The feature is not brain surgery.
Like an iPhone user on macrumors commented:
When I show my mates at work my iphone and tell them “Its the best phone in the world” I am going to feel a 1st class berk when they ask me to forward a text to them.
http://forums.macrumors.com/showthread.php?t=575058
MikeR, it’s not Apples to oranges at all.
The revenue (and profit) a company derives from this market is a great indicator as to the resources they can afford allocate to developing new iterations of the product.
Sure Microsoft is only getting a small fee from each phone sold. That’s the whole point. In large volumes that might be profitable. However, if Apple is clearing a PROFIT of billions each quarter and Microsoft is only making REVENUE in the hundreds of millions, who will be better able to invest in the future of their product line?
Microsoft can fund loser product lines for a while. Much longer than anyone else. But how many of those do they have on the go? (Xbox, Zune, UMPC, etc.) No one can lose money forever.
Sorry I just over-stated Microsoft’s potential to generate phone revenue in my last post. For some reason I was thinking Microsoft’s numbers were quarterly (should have read the article a little more carefully).
If Microsoft is getting the larger number of $15/phone license, and there really were 18 million sold in the last year, Microsoft’s total revenue is just $270 million FOR THE ENTIRE YEAR!
@disposableidentity
Of course that $270 million just needs to fund a team of 30-40 developers every year. Its not like they are making hardware, is it?
@Surur
If you can build, maintain and do QA on a mobile OS that supports dozens of different phone models from a dozen or so hardware manufacturers, respecting the hundreds of specific functionality requirements set out by the different telcos all while supporting multiple languages, with only 30-40 developers, I’ll hire you right now and take over the world.
Again, we’re talking about Apple making BILLIONS of free-and-clear PROFIT per QUARTER (after paying for the hardware, packaging, distribution, etc.) vs. Microsoft’s hundreds of MILLIONS in REVENUE per YEAR.
Now that is Apples to oranges.
Sorry, scratch QA from the list.
We are talking Microsoft here.
@disposableidentity
You may be right that 30-40 people are too small, but the fact remains that the Windows Mobile team is a very small part of microsoft, and are not even a separate business devision, being tied in with X-box, Zune and Windows Embedded.
Regarding the revenue and profit associated with selling hardware, it will take much more than Apple’s example to convince me that this is a more profitable business plan that just selling software. The margins on software, not just for MS, but for the whole industry, is gigantic (about 80% I believe) compared to the margin on hardware (for phones in general about 30%, and much lower for commodity hardware).
If Apple is an exception to the rule more power to them. There is a huge industry however built on the opposite premise.