How Microsoft’s Windows Phone ’07 can beat Apple’s iPhone in market share

“IDC caused some chuckles to break out across the tech world when they predicted that Microsoft’s Windows phones will beat the iPhone in market share by 2015. Impossible! Absurd! seemed to be the default responses,” Jon Brodkin reports for Network World. “But is it really so far-fetched? Gartner, the other giant tech analyst firm, now agrees with IDC in a new report that says Windows phones will take 19.5% market share by 2015, compared to 17.2% for Apple’s iOS.”

“While it’s tough to predict outcomes in such a volatile market four years in advance, there are plausible scenarios under which Microsoft can topple Apple in market share,” Brodkin reports. “To do so, Microsoft must position Windows Phone 7 as a low-end smartphone, almost like a high-end ‘dumb’ phone, while Apple continues going after the highest, most expensive end of the mobile market. If your phone can check email, surf the Web, and play music and videos it already does most of what a typical iPhone owner uses the device for. And if it’s free, rather than $200 to $300, many people will take it.”

“The other factor working in Microsoft’s favor, of course, is the Nokia deal. Because of its dominant position outside the United States, Nokia still sells more smartphones than Apple,” Brodkin reports. “Today, those phones are Symbian-based, but they will be transitioned to Windows Phone 7 as fast as Microsoft and Nokia can make it happen.”

Brodkin reports, “There have been some reports that Apple will develop a cheaper, smaller version of the iPhone to go after the low end of the market, but that still remains to be seen. 2015 is a long way away in the mobile market, but the combination of Nokia’s existing market share and a Microsoft strategy to target the low end of the smartphone market could well be enough to drive Microsoft sales ahead of the iPhone.”

Read more in the full article here.

MacDailyNews Take: Yippie. Did IDC and/or Gartner predict the state of the 2010 smartphone market back in 2006? Even though we’d love to see those, we can’t find 2006 predictions from either company, so maybe they were much, much smarter back then.

If (big if) this happens, do we also get several years of idiotic articles exhorting Apple to make cheap phones, just like we had, and still have, to endure from the “cheap Mac” brigade? Revenue share is what matters most, not market share.

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]

Related articles:
IDC: By 2015, both Android and Windows Phone will beat Apple’s iOS in smartphone market share – March 29, 2011
Strategy Analytics: Apple took lion’s share of smartphone revenue in 2010 – March 16, 2011
Surging iPad shipments propel Apple to #1 in worldwide mobile computer market share – February 16, 2011
Apple’s 4.2% mobile phone market share accounts for 51% of industry’s total profit – January 31, 2011
DisplaySearch not afraid to count iPad: Apple #1 mobile PC maker in North America, #3 in world – December 7, 2010
To understand market share vs. profits, look no further than Nokia vs. Apple – November 11, 2009
How Apple passed Nokia to become the world’s most profitable handset vendor – November 11, 2009
Strategy Analytics: Apple passes Nokia to become world’s most profitable handset vendor – November 10, 2009
NPD: Apple grabbed 91% share of premium computer market in June – July 23, 2009

89 Comments

  1. What an idiot. Does he know WHY Nokia is abandoning Symbian and Meego? Nokia’s lunch is being eaten at the low-end by Chinese mfrs, and the high-end is a failure against iOS and Android. Going after the low-end is just what Nokia was trying to avoid. It’s a commodity strategy that was failing. WP7’s hardware requirements also make that a no-margin loser.

    1. Isn’t that why we should encourage MS?! Embrace It, MS… Embrace It! Just like the PC, go after the low-end commodity strategy and under Ballmer’s capable leadership, it will fail… After MS dumps Billions in R&D on things that are no way near Apple-esqeue in terms of desire, want, need, and profit.

  2. Good point MDN.

    M$ will have no qualms about going down the road of cheapo phones to boost unit sales. But who makes money on them? Pennies at most. Just like the vast legions of PeeCee box builders. Congrats M$ your market share of the PeeCee world is such a great experience for all involved.

    1. Yes, good point MDN. “Revenue share is what matters most, not market share.”

      And yet not one anal—–yst seems to understand that simple point. Actually they are pretty much a bunch of people spouting rules from 10 years ago.

      Just a thought,
      en

  3. I imagine the logic is, “Remember how Windows beat the mac?! Remember? REMEMBER?!!” That’s pretty much the chant of “Apple is destined to lose” folks.

    They seem to have forgotten about how it worked out with the iPod vs. Every Other Music Player.

  4. While these predictions are steaming puppykuck, Apple needs to give users mores options to customize their iPhones.

    One of the reasons many jailbreak to add skins.

    Why not add skins, add some weather info to home screen…

    what’s the big deal?

    I mean the whole conforming thing in the 1984 ad, now is Apple, forcing all user to have the same look on their phone?

    1. So you believe that “many” jailbreak to see skins that are rarely actually visible while either as a phone, in your pocket, or running apps where no one can see them?

      You bet.

    2. Oh yeah, that’s the answer: skins?

      The fact is, tens-of-millions more would buy iPhone if, (a) they could afford it, (b) they weren’t already stuck with their current plan, (c) they weren’t so ignorant about iPhone, and Android.

    3. People already have the option you say. And you mentioned it: jailbreak. Granted it’s not Apple’s first choice or idea, but it ia an option if you want greater customization. I for one am fine with mine as it is.

  5. This was the Kin strategy and that failed. For the low end Android will take over. Costs sensitive handsets won’t bother with a Windows 7 license when Android is free. Also bear in mind that the $8-$15 Win 7 license fee is an input cost so will translate to a much higher retail price $20-30. Don’t believe me, I can go and buy an off contract Android phone for £80-90 in the UK. Apple can also go for the low end it already sells millions of iPod touchs and could easily add a GSM/GPS chip and antenna to it. That’s what the Apple Peel does.

    Every time an analyst hails the next iKiller it’s worth remembering all the previous iPod, iTune, OSX, iMac, Macbook, Macbook Air and iPad killers that haven’t.

  6. I want to hear more about Nokia’s position in North America.

    Oh, they haven’t got one.

    I want to hear more about Nokia’s ability to sell low profit, high volume cell phones.

    Oh, they’ve been losing their shirts doing that for the last 4 years.

    Anyway you look at it, MicroNokia, selling high end, low cost, semi-smart cell phones at a loss and making it up on advertising, will be extinct in 4 years.

  7. I can see this happening. There is a growing need for a dumbed down, and less expensive version of current high-end smart phones, like the iPhone. And Microsoft has no problem trying to be the “quantity over quality” player in the field.

    That said, revenue share will always go to Apple, no matter what their market share is.

    1. A “dumbed down” smartphone? Uh, no, there is not a big demand for such a device. That already exists, they’re called Blackberrys. And people are buying fewer and fewer.

      A dumbed down iPhone will just get people mad because what they say and what they want are different. They really want a free iPhone, and they’ll bitch and moan and complain if Apple releases a cheap iPhone that doesn’t do everything.

      Besides, you can buy an iPhone 3GS for $49. If you can’t afford $49, you probably can’t afford the data plan anyway.

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