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Summary:

Research firm IDC reiterated that it expects Windows Phone 7 to soar to number two by 2015 with 20 percent of the market, trailing only Android. But with the market moving so fast and competition so fierce, predictions like this seem premature.

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Windows Phone 7 and Nokia have a lot of believers at market research firms. How else to explain the latest IDC smartphone forecast, which puts WP7 ahead of iOS in the number two spot by 2015, where it will trail behind Android? The research firm reiterated that it expects WP7 to soar in the coming years, something rival Gartner has also predicted.

By the latest count, WP7 will command 20.3 percent of the global smartphone market by 2015, behind Android at 43.8 percent and iOS at 16.9 percent. IDC has revised its estimates somewhat from March, giving iOS even more market share by 2015 and reducing WP7’s and Android’s shares slightly. But it still has Windows Phone 7 as the leading challenger to Android in four years. Here’s IDC’s reasoning:

Windows Phone 7/Windows Mobile will benefit from Nokia’s support, scope, and breadth within markets where Nokia has historically had a strong presence. Until Nokia begins introducing Windows Phone–powered smartphones in large volumes in 2012, Windows Phone 7/Windows Mobile will only capture a small share of the market as the release of Mango-powered smartphones are not expected to reach the market until late 2011. Nevertheless, assuming that Nokia’s transition to Windows Phone goes smoothly, the OS is expected to defend a number 2 rank and more than 20% share in 2015.

Now, I understand that research firms have to put up some kind of numbers. And IDC has backed off a little from its earlier prediction. And the fact that WP7 will support multiple manufacturing partners gives it a chance to have a lot of units on the market.

But the latest predictions show how perilous it can be to make firm forecasts in such a fast-moving market. So much of the WP7 prediction is predicated on a smooth transition for Nokia. But if anything, the latest news out of Nokia suggests that it’s anyone’s guess how well that will turn out. The company has pulled back its projections for the year and has seen the departure of its CTO. The stock is at a 13-year low. As my colleague Kevin said yesterday, the wheels have fallen off. It’s not to say that Nokia won’t find its way again. But it’s got a very challenging road ahead to make this migration to WP7 work.

Symbian sales are dropping off precipitously. And why shouldn’t they, when Nokia has signaled that it’s a dying platform? But with Nokia WP7 phones not expected to arrive in real numbers until next year, Nokia is desperately trying to hold on through the transition. The thinking by IDC appears to be that Symbian’s 20 percent market share today will migrate over to WP7 by 2015. But that’s a big if. People buy new phones every 18 months or so, and they go with what’s hot and what’s appealing. They don’t necessarily keep buying Nokia phones just because the name is on the device. And Microsoft hasn’t been able to muster much in the way of consumer adoption of of WP7 devices so far.

Windows Phone 7 is a solid operating system and will get even better with the Mango software update this fall. But it’s not enough to just have a good OS. WebOS was solid, too. You need a lot of other things to fall into place, like great carrier support. Yet, some are questioning operator support for WP7 right now. And with Android and iOS building huge ecosystems, challengers need to find ways to leap ahead.

That might still happen with Nokia and Windows Phone 7. Nokia knows hardware, and it has leeway to customize on the WP7 platform. We could see very cool things coming down the road. The game, however, seems to hinge more on software these days. Look at Apple’s latest announcement at WWDC. It’s shifting the focus away from hardware to software cycles.

The bottom line is that 2015 is a ways off. Consider how fast things have changed in just the past year. Symbian’s share went from 44.2 percent in Q1 last year to 27.4 percent a year later. It’s likely to be below IDC’s 20 percent projection by the end of this year. This is a big market — IDC says 1 billion smartphones will be shipped by 2015 — but Nokia and Microsoft have to nail their execution to ensure that they have any hope of hitting 20 percent by 2015.

  1. The main reason imo that Symbian sales are dropping (in market share %) is that if you go into a phone shop and say you want a new phone they will try and sell you an iPhone or an Android if you ask about Nokia they will tell you that Symbian is dead and you should get something else. Nokia badly needs a WP7 phone to sell to customers. As has been pointed out many times by far smarter people than me it’s more important for Nokia to convert its legions of dumbphone users who number in the millions than the just the Symbian smartphone users. If they can do that then I think that WP7 has a very good shot

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    1. Yeah, Nokia has to convert its existing feature phone users. That’s a must. But there’s no guarantee that people who bought a feature phone from one company will automatically buy a smartphone from the same company. If i’m making the step up to a smartphone, which can be a sizable purchase, i’m gonna go with the best thing available that meets my needs. That could be Nokia/WP7 but not certain.

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  2. I am from Africa. I can tell you that IPhone is not even distributed by phone operators here! There is a huge market outside US/Europe. And Nokia/MS will have the lion share over here.

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  3. Winders 7, 8 or 29.4 will NEVER be a consumer-viable platform for Nokiasoft….. It’s a M/S piece of JUNK… So is the next one, besides being COMPLETE VAPORWARE….

    If you’re betting on any of this world to pull off a competing miracle, get your money back …. quick.

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    1. It doesn’t even exist yet. Are you from the future? You have to back up your claims if you’re going to make them. IDC does research to make their claims. They could be wrong but at least they factor things in vs vitriolic hatred towards MS. ;)

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  4. I agree that WP7 is headed for number two. The battle is over ecosystems, not devices. Apple gets that. Microsoft gets that. Google might get it, but if so, they’re doing a terrible job of execution. By 2015 I predict this ranking: 1) Apple, 2) Microsoft, 3) Amazon, 4) Google

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  5. Peter Jennings Saturday, June 11, 2011

    If they used actual data to form a conclusion for 2015 they would combine Nokia’s negative growth tangent with WP7’s negative growth tangent and they would come to a radically lower number.

    Nokia’s smartphone market share was 31 percent in January to 26 percent in April, that’s a quarter over quarter decrease of 16%, so assuming Nokia’s marketshare decline does not accelerate contrary to the words of its CEO, Nokia should have a market share of roughly 18.4% at the end of the year. Microsoft’s WP7 marketshare at the end of March was 1.6% according to Gartner. Since neither Gartner nor IDC released sales figures for WP7 in Q4 of 2010 (which I find highly suspect) we are able to draw 0 conclusions about WP7’s growth rate. Gartner is predicting 4.2% for WP7 by 2011’s end even though Windows Phone OS (including WM 6.5 and WP7) declined .6% in Q1 alone.

    So basically a manufacturer with a massively declining handset sales will combine with one of the least used mobile OSs and they will increase 67% yearly, faster 3 times the rate of Android. Did I mention IDC also predicted only 2 months ago that Android’s market share would be 45.4% in 2015, and now they are saying Android will reach 43.8% by the end of 2011!
    If they used actual data to form a conclusion for 2015 they would combine Nokia’s negative growth tangent with WP7’s negative growth tangent and they would come to a radically lower number.

    Nokia’s smartphone market share was 31 percent in January to 26 percent in April, that’s a quarter over quarter decrease of 16%

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  6. IDC has discredited itself.

    These numbers aren’t even picked from thin air. In my opinion, the numbers have been published in a deliberate attempt to make Microsoft (an IDC customer) look good. The end result is that the numbers are so incredulous that you cannot believe anything that IDC says.

    As for Nokia, CEO Elop is an amateur. He talked down and belittled Symbian at a time that Nokia needed Symbian the most. Windows Phone 7 has already been proven to have failed. The question is, what was Elop’s motivation for destroying his company to join Windows Phone 7?

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  7. So, Ryan, what would be your prediction?

    I really would like to hear it and since you aren’t even supposed to be an all-knowing oracle, like IDC among analysts should be, no one will blame you if you get it wrong.

    Will Android be no. 1? is there anyone who could challenge them?

    What about Apple, would one company really be able to sell enough to take the 2nd place by itself?
    Nokia is capable of doing this at this very moment, but they have phones in every price point that smartphones are sold at. Do you really think Apple would go slumming? By 2015 majority of smartphones will be sold at price that Apple might not be willing to touch. This actually might be the case already now.

    So what else is there?

    WebOS. As you pointed out WP has multiple manufacturers using it. You said that “WebOS was solid…”, yes but it was only used by one company that had good presence only on one market and they didn’t sell licences to anyone else. Now that it’s HP in charge, they could sell it and become a real player.

    Bada. OK this one has a big player behind it that can sell at all price points. But still it’s only one company, and a company that uses multiple operating systems, including WP.

    Symbian. This one seems to have a stigma. If Nokia doesn’t soon announce that “jk, we are not really using WP. We are investing to Symbian and look, here’s the promised new cool interface and it’s shipping _NOW_ .”” I’m not betting on Symbian to have the 2nd place still in 2015. No one is. It might have still some market share if Nokia decides to keep on pushing it to markets that like it, e.g. China and middle east.

    MeeGo. If Nokia would have kept the old track, maybe MeeGo would have been big enough to be on 2nd place.
    Now, I’m giving it a noticeable market share, one that will get it mentioned in stats but not one in top 3, thanks to it being open and there are manufacturers that are now interested and might have selection on phones out by 2015. It also can use the wider ecosystem that comes with all different version of if, Smart TV, Tablet, Notebook… and QT can be run also on Android so it has a potential. The Android port of QT, ministro, works now somehow and by 2015 it could be great. Also Android apps on Meego would work thanks to Myriad’s Alien Dalvik.

    What other players are there to compere for the 2nd place?

    Oh, and yes, some are questioning operator support for WP, especially on the North American side. However, one of the main reasons mentioned when Nokia announced its switch to WP was that operators wanted to have a 3rd ecosystem so that they wouldn’t be tied to duopoly.
    This makes me think that operators won’t let Android become strong enough that there wouldn’t be another OS between it and the strongest one manufacturer OS, be it then iOS or bada.

    So what would be the top 3 and what would be name of the 3rd ecosystem? What’s your guess.

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