Tag Archives: Google. Mobile

So Who is Giddy About Windows Phone 7?

Windows Mobile is a dinky business for Microsoft but it has assumed a much greater symbolic role as a lens to judge the company’s future prospects and its ability to compete outside of the traditional PC business (the inexplicable lack of a Windows tablet is more significant as the iPad is cannibalizing laptops but doesn’t seem to have the same level of external fixation). 

This means great scrutiny for the upcoming Windows Phone 7 launch.  Microsoft is ramping the marketing machine (including a parade) and promising nine or ten figures of marketing spend.  There is never a good time to be flat on your back in the market, but Microsoft picked a particularly bad time as the Windows Phone 7 delivery woes have coincided with the phenomenal growth of both Android and iPhone, but they’re ready to reengage.

Perception-wise, just maintaining share will count as a loss for Microsoft, so it is going to take more than just a solid product launch.  Windows Phone 7 is going to have to light some people up with excitement to be successful.  There are four constituencies I’m watching for signs for giddiness.

Smartphone OEMs

There are a decent number of OEMs committed to shipping phones running Windows Phone 7.  HTC, LG, Samsung and Sony-Ericsson amongst the traditional mobile phone manufacturers as well as more aspiring vendors like Dell, Garmin-ASUS, HP, Toshiba and Qualcomm (whose product plans are a lot fuzzier than the traditional guys).  Key questions to gauge excitement amongst OEMs:

    • Where is the Windows Phone 7 device in the OEM’s portfolio?  Hardware-centric mobile guys are pretty pantheistic, especially the Koreans who do one of everything.  Will Windows Phone be anyone’s lead device?  All the major mobile OEMs also do Android devices. 
    • How much hardware flexibility does Windows Phone give OEMs?  What hardware support got cut to get it out the door?  How many chassis (evidently that is the plural too) does it support? Can OEMs leverage their investment across a family of devices and differentiate themselves?  Obviously things like CDMA support have been pushed from the initial release.
    • Are the OEMs content to lose the ability to differentiate themselves with their own shells? (e.g. the HTC Sense UI).  Are there enough other opportunities for OEMs to believe they are differentiating themselves with Windows Phone 7?
    • Do OEMs see Windows Phone giving them more leverage with Google on the Android side or does it put their access at risk?
    • Will we see any surprise new OEM announcements?  e.g. Motorola, Nokia or RIMM?
    • Will OEMs get excited about paying for an OS again after a taste of Android?  Or is the license now just for patents rather than code?  There is a scenario where Microsoft makes more per Android phone than Google (who have own revenue challenges) via patent licenses.  The whole smartphone market is becoming a patent free-fire zone.

Mobile Operators

The operators are less important and have less control than ever before thanks to Apple’s trailblazing work but they can still mess up a launch with pricing, promotion (or lack thereof – think Kin or Palm) and the inevitable but self-defeating initiatives that get dreamed up in the name of not being a “dumb pipe”.  The operators are worse than PC OEMs when it comes to self-destructive and misguided “differentiation”.  Discerning operator giddiness is similar to the OEMs in terms of seeing where it fits in their overall portfolios, but they also have some unique attributes:

  • How many Windows Phones are in their portfolios and what kind of pricing and promotion do they get?
  • What’s up with the big operators and will any of them get behind Windows Phone the way AT&T rode iPhone or Verizon pushed Android?  Verizon has already announced they won’t do Windows Phone at launch.  Partly this is due to the lack of a CDMA-capable phone but you can also imagine if they get iPhone as rumored in the coming months, it is hard to see how Windows Phone doesn’t take a serious backseat while Verizon busily scoops up millions of AT&T customers.  But the flip side of this is AT&T is probably more interested in Windows Phone if they need to fill the hole the loss of the iPhone exclusive will create, though they bring a sullied network reputation to the Windows Phone camp.
  • Beyond the phone itself, there is also a battle being waged for who will control mobile services on the smartphone.  Will the operators accept Microsoft’s various services that are integrated with Windows Phone?  Microsoft is following right through the doors Apple and Google have opened but operators historically have thought of these services as their birthright.  Maybe Microsoft has placated the operators or perhaps they are ready to accept their “dumb pipe” fate (or maybe not).  Google can offer operators more search revenue share than Microsoft, at least based on the underlying economics.

Mobile Application Developers

Windows Mobile historically had a huge developer community and tens of thousands of applications.  But breaking backwards compatibility and the long delays in shipping make developer support for Windows Phone 7 much more tenuous at a time when there are alternatives with huge installed bases to target: 

  • When will the most popular existing mobile apps show up on Windows Phone 7?  Android still hasn’t gotten all my favorite iPhone apps.
  • Will we see breakthrough applications unique to the platform from Microsoft or anyone else?  How compelling are the mobile Office apps?
  • Will we see organic investments by developers or is Microsoft having to pay for apps?  Historically, Microsoft viewed any platform that had to pay developers to write code for it as doomed.
  • Can Microsoft thread the needle and avoid both the totalitarianism of the Apple App Store and the fragmentation and low value add of the Google Market?
  • Will confusion about Microsoft’s commitment to Silverlight after the IE9 HTML5 festivities affect developer investment?  Does Silverlight go forward or has the company quietly dumped it for HTML5?  Or will Microsoft have one programming model for mobile and another for PCs and tablets?
  • Can they get custom enterprise applications, historically a real strength of Windows Mobile and something that plays to Microsoft’s strengths?  This should be a slam dunk although the dynamics of your employer choosing your phone have deteriorated.

End Users

Last but not least are actual customers as the other three will follow if Mikey likes it.  Some key questions:

  • Who is Windows Phone 7 for?  The positioning to date seems all over the place.  The alternating emphasis on Xbox Live, Zune and Office doesn’t exactly scream focus.  All things to all people is a tough sell.  Competing across the board with Android and Apple seems like a mistake for this release.  Far better to be laser focused in this release on Blackberry who just happen to be in freefall anyway plus the enterprise positioning plays to Microsoft’s strengths.  The iPhone hearses in the release parade don’t suggest that kind of focus.
  • Why will a new smartphone buyer want a Windows Phone as opposed to the cool iPhone or a geek-chic Android device?
  • Will new user interface find fans?  Microsoft can’t be accused of just copying the competition as the Windows Phone 7 UI is unlike anything else out there.  I think the live “glanceable” home screen is better than the competition, but the “pan-and-scan” navigation model underneath it feels clunky and disjoint (admittedly I have only played with it briefly).

The smartphone market is a huge and rapidly growing market and there is room for multiple players as the majority of cellphones turn into smartphones.  But to be successful, some of the constituencies above are going to have to get really stoked about Windows Phone 7 for Microsoft to move up from the number five position behind Symbian (ok, that share is up for grabs), Android, iPhone and Blackberry.

And even if Microsoft moves serious volumes, there still are business model questions about a mobile operating system business in a highly fragmented market.  You have to sell a boatload of units at or below $10 a pop to make the billions in development and marketing expenditures pay.  And related services revenue, beyond search, is still more dream than reality at this point.

It will be fun to watch over the next couple months.