Windows Phone 7, Mark It Tardy - InformationWeek
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10/31/2010
09:08 PM
Dave Methvin
Dave Methvin
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Windows Phone 7, Mark It Tardy

I don't care what Microsoft's CEO Steve Ballmer claims, Windows Phone 7 is late to market -- dangerously late. Microsoft's late start is going to cost them a pretty penny.

I don't care what Microsoft's CEO Steve Ballmer claims, Windows Phone 7 is late to market -- dangerously late. Microsoft's late start is going to cost them a pretty penny.Ballmer's statement that Microsoft isn't late to the party would seem to be based on a view that the smartphone market hasn't yet reached its inflection point. If that is true, then the coming growth in the market means that Microsoft might even be able to pass its competitors within a few years. I'm not convinced that is a realistic scenario. Sure there is more growth to be had in mobile devices, but it isn't necessarily going to be smartphones. Older users may be content with their Jitterbugs and parents may not want their kids to be carrying a $300 device around. For devices where you can honestly argue the market is wide open, such as tablets like the iPad, Microsoft has yet to show whether it can even participate.

If the smartphone market can't look forward to exponential growth, then Microsoft's work becomes much tougher. They will need to convince many existing smartphone users to switch. Given the maturity of the iPhone and Android markets that would seem to be difficult. Users have had a few years to become accustomed to the way their smartphones work, and developers have created products to serve them. Users and businesses who have invested in apps or done their own development for iPhone or Android won't be in a hurry to add Windows Phone 7. This kind of market inertia worked to Microsoft's benefit during the heyday of desktop Windows, but now it's their enemy.

In this battle for market share, the mobile carriers are firmly in charge in the United States. If you want to sell phones, you will offer the features they dictate and leave out any features that might reduce their profits. Apple's relationship with AT&T has been the exception, and rumors indicate that Apple may not be having their way with Verizon. Some of Apple's lost leverage is due to Verizon having several successful Android phones. Carriers will no doubt be playing Microsoft against Apple and Android; it may be difficult for Microsoft to hold to its UI design principles (or revenue goals) in the face of carrier demands.

Despite this looming uphill battle, I don't doubt Microsoft's commitment to the mobile market. Multi-year trails of red ink with the Online and Xbox divisions show they are not afraid to spend billions to elbow their way into a market. Mobile devices is where technology growth will be centered for the next decade, and Microsoft will spend what it takes to be there.

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