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Summary:

Will 2006 be the yearwhen Microsoft Mobile finally takes off? It certainly looks like that. Microsoft’s mobile ambitions are on display at the 3GSM show in Barcelona. CEO Steve Ballmer gave a big wet kiss to wireless operators in his Valentine’s Day keynote address at the […]

Will 2006 be the yearwhen Microsoft Mobile finally takes off? It certainly looks like that. Microsoft’s mobile ambitions are on display at the 3GSM show in Barcelona. CEO Steve Ballmer gave a big wet kiss to wireless operators in his Valentine’s Day keynote address at the wireless mega show.

Store shelves are crammed with brand new Windows Mobile 5.0 devices. And a lot of it has do with HTC and its amazing designs. Cingular 8125, T-Mobile’s latest revs of SDA and MDA and Treo 700. HP just announced a refreshed line-up. The Motorola Q is one of the most eagerly awaited PDA/phones. More are coming. Like the new Samsung i320 which features a full keyboard device, very small and compact. There are 47 device makers churning out Windows Mobile devices.

This wasn’t supposed to happen …..


Guest Column by Matt Maier

When Microsoft made clear its mobile ambitions a two and a half years ago, conventional wisdom said the PC-juggernaut would fail miserably, held at bay by Nokia, and others in the wireless industry who weren’t keen on watching their businesses turn into a no-margin commoditized nightmare, and overwhelmed by the complexity of the fast-moving industry. When Redmond had problems with Sendo, its first hardware partner, many assumed it signalled the end of Microsoft’s ill-fated mobile ambitions.

Instead, the exact opposite has happened. After spending years lining up hardware partners like HTC and Palm, working around handset vendors to sign deals directly with carriers such as Cingular, and coming up with a respectable version of Windows Mobile (like usual, the third rev was a charm) Microsoft is poised for a banner year.

Revenues in its mobile and embedded devices group grew 51 percent last year (to about $75 million) and nearly broke even, posting a $2 million loss in its first quarter, compared to a $29 million loss the year prior.

“We’re finally at a real tipping point,” group product manager John Starkweather told Business 2.0 earlier. “It’s taken a number of years and software iterations, and now we’re expecting some serious growth.”……. by partnering with white-label electronics manufacturers such as HTC, Microsoft presented operators with a means to customize phones exactly to their network specifications, while HTC allowed the carriers to brand their own names on its phones. “We realized there had always been a love-hate relationship between carriers and big phone vendors,” Starkweather says.

Microsoft may have already hit its stride. Devices like Cingular’s 2125 and 8125 are popping up on most major carriers in the US and Europe, it did the unthinkable, and convinced Palm to dump the Palm OS for its new Treo in favor of Windows Mobile, and has nearly 50 different hardware partners shipping product.

Undoubtedly, there’s still a long ways to go: Symbian powered nearly 34 million devices last year, more than double what Microsoft was able to ship, but the gap is narrowing. As the price of high-end phones begins to drop, and more people begin to use their phones as extensions of their desktops–looking for email on the go, etc–Redmond is ready to reap the gains.

Guest Post by Matt Maier, wireless and gizmo correspondent for Business 2.0 magazine. Subscribe to his Third Screen Newsletter.

  1. terrific post and well-timed. i’m glad to see that someone has grasped the 700w for something more than just device specific OS change.

    But, a larger question, could WM5, 360 and the Media Center OS show a fore-sighted, profitable (and accordingly rare) gamble on the long run? The economic implications could be ground-shaking, not just for the tech biz (see Apple, i.e. iPod = short run), but the economy in general.

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  2. I guess, someday we’ll be free enough to load any OS as we like on to our phones. I wont choose Windows though.

    http://www.eet.com/news/latest/showArticle.jhtml%3Bjsessionid%3D1YHYE1POSFNZ0QSNDBESKHA?articleID=179101716

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  3. I think part of the reason MS will win thw cell-OS battle ( and they certainly will) is basically they are doing the same they did with palm: taking a high end desktop OS api and shrink it until it ‘ll run on cellphones, while it might seem the wrong thing to do , they have murphy’s law on their side, as processors and memory get cheaper, optimization mothher less and features more.
    Meanwhile Symbian and Palm came the opposite route, a limited OS for portable devices and they will had a hard time scaling it up to the new devices.

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  4. true. when you are that big, failing takes special talent. MS is also wining because of the sheer size and who knows what kinds of armtwisting and other tricks MS may be using. i have heard rumours that ms for mobile is being offered dirt cheap, if not free, and with a compnay that controls most of the computers and business software, breaking deals will not be a problem. Example : Newspaper buys stake in giant retail chain in exchange of advertising space!!! how can a startup fight, unless, he is a pioneer in terms of idea/execution etc etc (like Google). how many startups can do that? and i do hope we have a choice and I am able to buy a non-MS mobile device. unlike the fact that my favourite MacOS will now be run on the same intel chip that the next discount store dell will. o brother, where is the choice?

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  5. Space-Age Cell Phone

    My next cellphone will be  a Motorkia … don’t rush to order yet…. it’s dreamt up by a bunch of VC’s interviewed by Techcomm, The National Journal of Technology Commercialization.  Click the photo for details.I wonder about the …

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  6. I’m impressed with the latest version of Windows Mobile devices and having seen the Direct Push functionality in action think they’re going to have a great year. However, stating that there are 50 different hardware partners is a little misleading when so many of them are offering re-branded HTC products. It would really help MS if they got some more of the traditional mobile phone brands on board (either that or Motorola could actually ship something rather than demo it at trade shows).
    Also I’m not sure where you got a figure of around 17 million devices shipped by MS last year. That seems very high compared to recent Canalys and Gartner reports, have you got a reference?

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  7. What I like about Microsoft challenging the Symbian crowd is that this competition motivates (scares) the heck out of Nokia, Ericsson, et al and the heat will be on for Symbian (as well as Microsoft) to attract developers to their platforms. Furthermore, the chances of open source software coming to these devices increases substantially. For example, Symbian has already started to provide a Python interpreter for the Nokia Series 60. This is really great because developers have choice and they’re not locked into figuring out what version of Java (if Java at all?), for example, is on these phones (what a pain in the butt that has been so far to-date). If I can develop content applications on these mobile devices with Python or Ruby, I’m going to be in 7th Heaven!!!

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  8. [...] Is Microsoft coming into the mobile space fast and furious? Yes and Om Malik noticed. [...]

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  9. Microsoft have finally got themselves into a position where they not only have the platform, service providers and hardware vendors on side but they have also provided an adequate tool set for the developers to develop software for their platform. In many ways they are helping to open up software innovation on devices.

    The likes of Google can leverage off of the fact that they can put their own internet explorer style web surfing application on there as well as having the MS pocket IE software available.

    Symbian unfortunately don’t seem to be able to get around the issues with providing web data on small scale devices where Microsoft can.

    Which one would you choose? I know as a developer I would go with ease of use and a quick easy learning curve for my users which suggests Microsoft Mobile 5.0 to me! (It’s just a shame Google are banking on Symbian developers in their mobile strategy!)

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  10. i don’t think they are going to dominate the mobile market because of many reasons. one of them being that most phones have a feature overkill, are still sluggish and well, don’t do the job of the phone quite well.

    they do the pc stuff quite well. i think activesync is a good technology. it still takes a lot of memory and is slow like shit. but compared to three years ago, this is space age.

    but don’t discount symbian, which in my opinion, is going to be the smart phone os for the masses because it is more robust for phone features first (and then the tiny-pc stuff.

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