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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 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)


"You can bet that Sony built a long-term business plan about being successful in Japan and that business plan is crumbling." -- Peter Moore, 24 hours before his Microsoft resignation














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