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Window Phone 7's market slice contracted slightly in the closing months of last year. But the platforms true test will come when it reaches a fully-updated form, begins popping up in Nokia handsets, and hits Verizon/Sprint during Summer 2011.  (Source: Reuters)
Windows Phone may yet reverse the fortunes of the struggling giant, but the proof isn't there yet

Q4 2011 wasn't exactly the start for Windows Phone 7 that Microsoft might have dreamed of, but the platform is far from out of the picture.

Windows Phone 7 lost some ground in October 2010 through January 2011 of this year according to market research firm comScore.  The platform dipped from 9.7 percent market share to 8.0 percent.

Other losers for the quarter were HP's Palm unit, which fell from 3.9 to 3.2 percent, and RIM, which dropped from 35.8 to 30.4 percent.  Apple held steady, beginning at 24.6 and closing at 24.7 percent.  

The only real winner was Android that soared from 23.5 percent to 31.2 percent.  In other words -- Android is eating everyone else's lunch, except for Apple that is hanging steady due to its legion of loyal fans.

Ultimately this is news we've known for some time now.  Other market research reports have reported Android already having passed RIM and iOS.  The interesting and much-talked-about aspect of this particular report is the implication that Microsoft lost even more market share.

While it's tempting to predict to buy in to the gloom and predict the demise of Windows Phone 7 (and some are indeed doing exactly that), the outlook for Windows Phone 7 is pretty good.  With arguably the market's most cutting-edge user interface (and a well-liked one by customers to boot) Windows Phone 7 offers a unique profile.  

With a partnership with Nokia in hand it seems destined for a large boost in market share, possibly to the number two position, as Nokia phases out Symbian over the next year.  Many have expressed skepticism of this given Nokia's poor performance, but history shows that Nokia is more than capable of lingering around, market share-wise, despite an anemic smartphone lineup in the U.S.  And while recently revealed details indicate Microsoft may have essentially "bought" that market share via a $1B USD payout to Nokia, at the end of the day it's where the market moves that counts.

The reasons for the dip seem pretty straightforward.  

First, there was a limited number of handset options at launch time compared to Android and WP7 handsets haven't landed on Verizon or Sprint.  In this regard Microsoft will continue to suffer for a little while as a Microsoft spokesperson says that the handsets won't hit America's biggest and third biggest (respectively) carriers until June 30.

Second, many buyers on AT&T and T-Mobile who might be interested in Windows Phone 7 handsets may be waiting to see how Microsoft's intense cycle of early updates plays out.  Those updates will add functionality like third-party multi-tasking and copy and paste.  Likewise they're likely waiting for issues like update compatibility and phantom data to be cleaned up as Microsoft and its hardware partners break in the platform.

Microsoft proclaimed earlier this year that it sold 2 million "units" of Windows Phone 7 (licenses, not handsets) -- a rather misleading figure as its true handset totals were far from that.  Likewise, some of the platform's critics have been quick to call it a tremendous failure.

Reality is that Windows Phone 7's true potential won't be seen until it lands on Verizon -- effectively in July -- at the least.  Like Android's original launch, the most serious test will come at about the end of the year.  If the platform can't gain ground during the Nokia phase-in and with a year of updates under its belt, then it's time to worry.  But chances are that Microsoft's position will improve -- even if its start was far from what it might have hoped for in its most optimistic dreams.



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RE: WP7
By Flunk on 3/9/2011 8:33:24 AM , Rating: 2
But the codebase is mostly new (still uses wince kernel), therefore first iteration. It doesn't matter that marketing stuck a 7 on the end of the name.


RE: WP7
By Aloonatic on 3/9/2011 9:26:03 AM , Rating: 2
But but but....

They've had many more years experience in the market, and are yet somehow still late to the game? They should at least have learned some of the lessons from others, but that doesn't seem to be the case. I'll grant you that things have moved on since Win Mobile, but still, that's hardly a mitigating factor, really.

The way some people here talk about Windows Phone 7, you'd think that MS had only just decided to start making a phone OS, and that's just not true. That they had to tare everything up and start again is hardly a great excuse either.


RE: WP7
By Aloonatic on 3/9/2011 9:39:47 AM , Rating: 2
By the way, I have nothing against WP7, just nonsensical arguments.

I hope that MS do well, as long as their product is good.

That's all I care about really, a good product, not lame excuses and fanboyism.

For the record, I think it's silly to measure growth rates over such short time frames. Even if I really really really wanted a WP7 device, I wont be getting one until the end of this year, as that's when my current contract runs out.

They are late to the market, which is approaching saturation. Most of the new smart phone user growth is happening in the value end of the market. Not the higher spec'ed devices where MS seem to be placing their hopes, as many of these people already have a smart phone.

The one good side is that a lot of Android users are misers like me who don't really spend much on their apps, so shifting from one OS to another wont be such a hardship, as it might be for iPhone users. Perhaps that's something that MS can capitalise on? I know that come contract renewal time, I'll certainly be giving them a look :o)


RE: WP7
By Smilin on 3/9/2011 4:13:28 PM , Rating: 2
Remember this:

1.They are late to *this* game but have made an impressive showing.
2.The game hasn't even really begun. Being #1 in smartphones right now is like being #1 in PC sales in 1984. The market hasn't even started yet.
3.They came late to the last smartphone game too. Within a few iterations they had obliterated the number one competitor...Palm doesn't even exist now.
4. Microsoft doesn't suck. Really. They've got talent, resources, partnerships, and R&D constantly rolling through the pipe.

I won't say they'll become number one but if you say they'll fail then you're a fool.


RE: WP7
By Aloonatic on 3/9/2011 5:07:26 PM , Rating: 2
1- Impressive showing is a subjective thing. There fans here seem to eb happy, and I've never said that what they have made is bad, they just haven;t really wowed either, sharing the same problems ande deficiencies in their mobile OSes as others have on their first outings. The thing is, this isn't MS's first outing with a mobile OS, as you admit.

2- I think you're waaaay off there. When my mother-in-law has a smart phone, then you know that the market has more than only just started. Sorry. You can try to pretend if you want. However, as I mentioned in another comment, the smart phone market is pretty mature, and those people who want a high end smart phone (which is where MS seem to be positioning WP7) probably already have one. They might move over, including myself, but that will depend on contract lengths now.

3- I'm not sure what you are talking about? Is the smart phone market started or not? You seem to be picking and choosing here a little. They might have obliterated Palm in the PDA/smart phone stakes, but then what did RIM do to MS in the smart phone market? As well as Symbian too, which has, admittedly, fallen by te way side now. Also, are you agreeing that MS isn't new to the smart phone market too? Which is all that I have been arguing really. WP7 isn't just a first iteration, it's a re-branding of Windows Mobile, with a major over haul too.

4- I never said that MS sucked?!?!?

Never said that they would fail either.


RE: WP7
By Smilin on 3/10/2011 10:55:58 AM , Rating: 2
quote:
1- Impressive showing is a subjective thing. There fans here seem to eb happy, and I've never said that what they have made is bad, they just haven;t really wowed either, sharing the same problems ande deficiencies in their mobile OSes as others have on their first outings. The thing is, this isn't MS's first outing with a mobile OS, as you admit.

Yep, it's subjective but most agree. Your distaste of MS is pretty subjective too.

quote:
2- I think you're waaaay off there. When my mother-in-law has a smart phone, then you know that the market has more than only just started. Sorry. You can try to pretend if you want. However, as I mentioned in another comment, the smart phone market is pretty mature, and those people who want a high end smart phone (which is where MS seem to be positioning WP7) probably already have one. They might move over, including myself, but that will depend on contract lengths now.


One anectode about your grandma is not a convincing argument. So you think the mobile device market has reached maturity then? If it's so mature why is it nearly doubling in size every year?

"Out of the 4.2 Billion mobile phones, 750 million are smartphones (about 18%)."http://www.brightsideofnews.com/news/2011/2/4/mark...

Assuming the total mobile phone market utterly stagnates that means the mobile phone market could still grow almost sixfold. But that's really not going to happen: http://www.dailymarkets.com/stock/2010/06/07/smart...

We're only now nearing the end of the beginning. The real war will be in the next decade when the market explodes by an order of magnitude.

quote:
3- I'm not sure what you are talking about? Is the smart phone market started or not? You seem to be picking and choosing here a little. They might have obliterated Palm in the PDA/smart phone stakes, but then what did RIM do to MS in the smart phone market? As well as Symbian too, which has, admittedly, fallen by te way side now. Also, are you agreeing that MS isn't new to the smart phone market too? Which is all that I have been arguing really. WP7 isn't just a first iteration, it's a re-branding of Windows Mobile, with a major over haul too.

I agree that you don't know what I'm talking about since you shooting wildly everywhere. Here is the simple version: MS has gone into markets as an underdog over and over and knocked out the competitors. To write them off would be a catastrophic folly.

quote:
4- I never said that MS sucked?!?!?
No, you didn't nor did I accuse you.

quote:
Never said that they would fail either.

No, what you seem to be saying (IMO) and that others seem to be missing is that this is a version 7 product. That is factually correct but not useful for this debate. For practical purposes it is a 1.0 product. MS last 1.0 product in this area was followed by successors that put a real hurt on their competitors. They (and the whole industry) slacked until a hungry competitor came along and they got knocked out. Now it's back to 1.0 again and so far it's looking innovative once again.


RE: WP7
By Aloonatic on 3/11/2011 3:21:39 AM , Rating: 2
I don't know what debate you think I'm having, but all I started off saying was that WP7 isn't MS's first go at a mobile OS.

1- Why do you say that I have a distaste of MS? Just because I dared to point out what I did? Read my other comments, learn, sit back down and... :o)

2- You seem to have missed the point that I was making, and seem to be unable to comprehend the difference between a grand mother and mother in law, which is a little worrying. What I am saying, and could have said more clearly, is that high level smart phones, which MS seem to be exclusively aiming at, are pretty close to maturity. I suppose they don't have a great deal of choice in this, being so ate to the game however.

The smart phone that my mother-in-law has, however, is a HTC wildfire. Much of the growth in the smart phone will market now be in this cheaper and less powerful device area, IMO. Just as not all mobile phones a few years ago were top of the range camera phones, an awful lot were cheap and cheerful efforts.

3- Not sure why you say that I am spraying everywhere? I've been pretty specific, and just replied to what others have said since You'll notice that I started off with a simple point, only for others to tack issues on. Also, I've not written anyone off. Seriously, why so touchy about any criticism or non fanboy like supporting comment of blind, unquestioning support?

I'm also curious about MS ever being seen as the under-dog in any market that they enter. They might be the new boys, perhaps, but I doubt that anyone sees them entering a market as a little company that might not stand a chance against the big companies out there that are larger than them, like.... Erm, yeah, Palm were much bigger than MS? They don't always succeed tho. Even though many people here love zune, I have never met anyone who has used one in the real world. MS might have made the greatest product in the world with the zune, but zune has hardly become synonymous mobile MP3 players.

So, just as it's foolish to write them off as catastrophic folly (which I never did, and I agree with you, it would be stupid to write them off) it's also catastrophic folly to assume that they will definitely be #1 in the market.

4- If you weren't accusing me, then why put that statement in a comment that was clearly aimed at me?

Finally, I'm glad that you can see that I am factually correct. And you might also notice that in my very first sentence in all this I said that it depends on your point of view about what a first iteration is. You (clearly an MS fan seeing as you seem to take any criticism so personally) might like to think that this is effectively a first effort by MS, and yes, they have restarted their efforts, but to judger them on the same level as other companies who have not been making mobile OSes for years and years as MS have done is not correct, IMHO.

Again, as I have said in other comments, I hope that WP7 is great. I wont rule it out when it comes to contract renewal time, by any means.


"A politician stumbles over himself... Then they pick it out. They edit it. He runs the clip, and then he makes a funny face, and the whole audience has a Pavlovian response." -- Joe Scarborough on John Stewart over Jim Cramer














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