Sunday, July 4, 2010

Microsoft’s Mobile Fail

I officially dub this the “Summer of the Smart-Phone.” Google’s Android phones have been releasing at the rate of nearly one per week since May with the new Sprint EVO 4G by HTC and Verizon Droid X by Motorola leading the way. And unless you have been living under a rock for the past few months, you have undoubtedly heard about the new iPhone 4 from Apple. The competition for high end mobile devices is hotter than Houston in August.

Even Rim, the manufacturers of the Blackberry line of smart-phones, has announced several new high end devices. And while Rim still leads the market in shear numbers of phones sold, they are quickly losing ground to the new kids on the block from Google and Apple.

The Palm Pre has had a dismal year because of hardware problems with the early phones, but the recent purchase of Palm by HP means we will probably be seeing new devices based on the WebOS by years end.

What about that other smart phone company? You know, the guys who make the most popular desktop operating system on the planet? The company that generates more money in a day than Apple and Google make in a week? Microsoft has a new phone coming out later this year. They are calling it Windows Phone 7, although it doesn’t appear to have anything to do with Windows. It is definitely not Windows 7 on a phone.

Microsoft has sold a lot of smart-phones over the years, and their market share remains much higher than the Android’s. Yet nobody seems to talk about Microsoft when they are comparing phones. The conversation is always comparing the latest Android phone to the newest iPhone.

Microsoft has never quite “gotten it” when it comes to mobile phones. Look at the recent birth (and subsequent death) of the Microsoft Kin. When this phone came out most experts questioned what market it was for. It wasn’t a smart phone in the classic sense of having an App Store and lots of applications. It didn’t run any of the standard mobile device Operating Systems.

Verizon launched the Kin to much fanfare. Ok, well actually it was very little fanfare, and you may have missed it unless you were in the target audience of people in the 15-19 year old range whose parents don’t want them to have a full featured smart-phone. The phone’s market was so small it appears to have dried up within a month. Verizon and Microsoft have already announced they will stop selling the phones this summer.

To be honest, nobody cared. Just like nobody seems to care about Windows Phone 7. With the possible exception of those people who will be writing books and blogs about the next Microsoft smart-phone operating system. Hopefully they will buy each others books.

So where did Microsoft go wrong? Why has this company who controls the desktop PC market been unable to control the smart-phone market. How is it they allowed both Apple and Google to come in and steal all of their thunder?

Their biggest failing is their number one success: Windows. Fundamentally they have treated every new device they lay their hands on as if it is just another Windows platform. In the early days of Windows CE and Windows Mobile it was clear Microsoft believed what people wanted on a small device was Windows. complete with Word, Excel and Outlook.

What Microsoft didn’t see, and I think could not see, was the fact that people don’t use their phones in the same way they use desktop computers. While the smart-phone can be an information content creation device, to most people they are communications devices. Phone, email, text and even browser applications allow people to connect and communicate in a way that does not strap them to the desktop. This is why Twitter, Facebook and Instant Messing apps have become extremely popular on these phones.

Smart phones today also need an application store with third party apps which allow customers to fully customize their mobile experience. This has become so fundamental it has become one of the foundations of any smart-phone.

While Microsoft has already announced and shown many of these features in the new Windows Phone 7 demos, I can’t help think they are more than a day late and a dollar short. Millions of people are already making their decision about the smart-phone they will be using for the next few years. Right now Apple is leading the way, but Google has firmly staked out it’s claim. Yet Microsoft won’t have a phone ready until the end of this year at the earliest. In my opinion that is just to late. By wasting time, resources and credibility on the doomed Kin phone, Microsoft has essentially forfeited the race.

The “Summer of the Smart-Phone” is in full flower. Any company who is not staking their claim to the future of this market is going to have a lot of work to do in order to catch up. And I suspect it won’t be enough to come out with something better. It will have to have a “wow” factor that leaves Steve Jobs panting.

I suspect Windows Phone 7 will not be that phone. I’ve already heard rumors that the first iteration of the phone will be missing many key features (like cut and paste). Taking a step back to redesign the Windows Phone platform may be a good idea, but will it be one more nail in the coffin for a platform that has been deemed irrelevant by many people for the past several years?

I believe it will.

And there is more at stake than smart-phones. Apple threw down a new gauntlet with the iPad earlier this year. Once again they have given birth to a not entirely new market that Microsoft had thought dead. Android slates are already appearing on the market, with an entire quarry of new product announcements coming out every week. I have little doubt that HP has it’s eye on developing it’s own tablet/slate device based on WebOS.

Apple will face stiff competition in both of the markets it can be said to have established: High end smart-phones and tablet devices that allow the user to take the internet with them. Android has taken up the challenge and the consumers will be the winners.

Several years ago with the launch of Windows XP Microsoft used the tag line “Where do you want to go today?” Today we’re all going there, but it seems Microsoft will not be along for the ride.

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