Microsoft pins major hopes on Windows Mobile ‘07

“By almost any measure, Microsoft is nearly out of the mobile game,” Peter Burrows and Dina Bass report for Businessweek “Its market share fell to 5 percent from 22 percent in 2004, says Gartner. Customer satisfaction of Windows smartphones is 24 percent, according to ChangeWave Research; it’s 74 percent for iPhones and 65 percent for handsets powered by Google’s Android.”

MacDailyNews Take: Leave it to Microsoft to make Obama’s approval numbers look good.

Burrows and Bass report, “There are a few hundred apps for Windows mobile, vs. 250,000 for Apple and 70,000 for Android. Asked about Windows Phone 7’s chances, Google Android chief Andy Rubin has said: ‘The world doesn’t need another platform.’ Unless, of course, Windows Phone 7 handsets, on sale Oct. 21 in Europe and Nov. 8 in the U.S., blow away consumers as the iPhone did back in 2007. Today, consumers load their smartphones with apps. Rather than tap between separate programs, Windows Phone 7 users will choose from a few larger icons—Microsoft calls them tiles—that aggregate information from related apps.”

MacDailyNews Take: An icon by another name is still an icon. Effing “tiles” are not going to sell pretend iPhones on carriers that have actual iPhones. Microsoft’s Windows Phone ’07 simply does not offer the amount of differentiation or innovation it would need to not be just another mobile OS that the the market doesn’t need. Their $500 million marketing budget may make a dent in the iPhone wannabe market, negatively impacting Android, but there is no reason for yet another mobile OS to exist except that Microsoft wants a piece of the market. That’s why they have to blow $500 million on marketing. We say, go for it, let the iPhone pretenders kill each other on non-iPhone carriers. As iPhone spreads to carriers, particularly to multiple U.S. carriers, the amount of customers available to Google, Microsoft, Nokia, RIM, etc. drastically shrinks. Smartphone customers have no reason to settle for fake iPhones if their carrier has real iPhones.

Burrows and Bass report, “Microsoft mobile chief Andy Lees says Windows Phone 7 reflects his group’s new approach to design. In the past, the company wrote the software and left it to licensees to ensure great products. This time, Microsoft set strict rules. All Windows Phone 7 handsets must come with three buttons (home, search, and back) and a camera with at least five megapixels of resolution.”

MacDailyNews Take: Android Windows Phone ’07. Never do with one button that which you can do with four three.™

Burrows and Bass report, “Building an ecosystem—there’s the rub. The tech world usually jumps behind Microsoft’s initiatives. That hasn’t happened in mobile… Although Microsoft wants to deemphasize apps, it still needs them. That’s why it’s paying some software makers to write apps for Windows Phone 7. While eBay and Netflix have obliged, many others won’t until they see brisk Windows Phone 7 sales. Tim Westergren, founder of the popular online radio app Pandora, says he has no plans for a Windows Phone 7 app. We’ll go wherever we see the volume, he says.”

Burrows and Bass report, “Other factors could prevent Microsoft from having the debut many experts say it needs. Owners will not be able to cut and paste text or simultaneously run multiple apps as they can on most smartphones. While AT&T and T-Mobile will offer Windows Phone 7 devices, the software won’t work with Sprint (S) or Verizon Wireless until next year. (Apple’s AT&T-only iPhone may be on Verizon by then.)”

MacDailyNews Take: We understand why that last sentence has been placed within parenthesis, but it’s hardly parenthetical. It will change everything. It will destroy the Android copycat’s main toehold instantly. In countries where iPhone is on multiple carriers, people don’t settle for Android in the numbers they do in the U.S. where one of the two largest carriers does not have iPhones to offer.

Burrows and Bass report, “Holding share in such a fast-growing market could require sales of about 20 million units in 2011, no easy feat. That’s how many iPhones Apple sold in its debut year. Ursillo estimates Apple will sell 75 million in 2012. Even if consumers were to somehow buy 37 million Windows handsets the same year, that would add just 3 cents per share in profit, says Loomis Sayles analyst Tony Ursillo.”

MacDailyNews Take: If there is an Apple iPhone on Verizon in 90 days, to whom are Microsoft and Google and the rest going to sell pretend iPhones?

Burrows and Bass report, “Microsoft’s to-do list doesn’t end with Windows Phone 7. It has no tablet software that can match the iPad. Failing in smartphones would be bad. Failing in tablets, which users expect to run office software, would be catastrophic, says Elevation Partners co-founder Roger McNamee, who brings up once-proud computing names as worst-case scenarios. If Microsoft misses the market for tablets, he says, the collapse in their relevance to consumers will remind people of Digital Equipment and Wang 20 years ago.”

MacDailyNews Take: Right where they always belonged. Microsoft got lucky with a bad contract once that allowed them to plunge the world into The Dark Age of Personal Computing. No such contract exists for Microsoft to rip off iOS ad infinitum, falsely and incessantly claiming “innovation” on their way to the bank. Apple’s extensive patent portfolio will prevent Microsoft from making up years this time. Microsoft’s success was an anomaly. The made a fake Mac, marketed to a largely tech illiterate market that is much more tech savvy today, which allowed them to build monopolies for a desktop OS and an office suite. Pretty much everything they’ve tried to do on their own has failed; break even at best and usually much worse.

Full article here.

MacDailyNews Take: It comes down to a very basic question: Was the world crying for yet another smartphone OS before Microsoft unveiled Windows Phone ’07? No, the world was not. That’s why Microsoft has to throw $500 million at marketing the thing in a desperate shot to recapture four lost years with superfluousness. The problem for Microsoft is not only that they have no ecosystem, developers don’t care unless they’re bought off, and Android already owns the wannabe iPhone market, but that iPhone is spreading to multiple carriers per country, drastically shrinking the market for pretend iPhones into which Microsoft hopes to break. It’s simply a case of too little, way too late.