Ballmer: Windows Phone Sales Still Disappointing - InformationWeek

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9/16/2011
12:03 AM
Ed Hansberry
Ed Hansberry
Commentary
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Ballmer: Windows Phone Sales Still Disappointing

Microsoft CEO works to convince financial analysts that the mobile platform has a bright future in spite of weak first year sales.

Expectations for Windows Phone 7 have been higher than the reality. Steve Ballmer was once again talking the platform up onstage, this time Wednesday at the Microsoft financial analyst meeting. These are the people that need to be convinced the platform has legs and that the millions, and potentially billions, spent on it will pay off.

"We haven't sold quite as many as I would have liked in the first year," Ballmer said, according to AllThingsD, which was live blogging the event. He went on to say "I'm not saying I love where we are but I am very optimistic on where we can be ... We've just got to kick this thing to the next level."

The platform has a number of things going for it. Late last year, Microsoft committed around half a billion dollars to marketing Windows Phone 7. It also won over Nokia, which chose to abandon both the aging Symbian and not-yet-born MeeGo platforms. Those phones should launch in the next few months. The Windows Phone MarketPlace has over 30,000 applications in it, putting it in third place behind the application stores for iOS and Android--both of which are well north of 300,000 apps.

For some time, analysts have been predicting Windows Phone would dominate the smartphone scene by 2015. More recent forecasts show Microsoft in second place by 2014 with just over 20% share, a number Microsoft thinks is understated.

So what is going on? Why, a year after launch, is the platform still in the low-single-digit share territory?

There are a few reasons, but two big ones come to mind. First of all, it has the stigma of the name "Windows" on it. On the desktop, Windows 7 redeemed that name, but in smartphones, Windows Mobile 6.x sullied it. Microsoft has to overcome a lot to get rid of that image.

Second are the applications available for the platform. Apple, and more recently Android, has been receiving a lot of free advertising by people reviewing and mentioning apps online. Go to sites like LifeHacker and read any article on mobile applications. Chances are it will be either for iOS-only or iOS and Android. Once in a while BlackBerry is mentioned, but Windows Phone is pretty much missing in action. That gives the platform the negative connotation that there aren't any good apps available for it.

Ballmer wants to "kick this thing to the next level." It is a reasonable assumption that Microsoft wanted that from the beginning. Has the company been waiting until now to do so, or is it uncertain exactly how to go about it?

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