Summary:

Microsoft’s Windows Phone 7 sales may be lagging, but the company is making sure it continues to develop the app ecosystem, which can help boost sales. Apps are now supported in more countries and developers have new Marketplace tools in preparation for the next software update.

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Microsoft is today equipping third-party developers with more tools in advance of the next update for Windows Phone 7 smartphones. The company more than doubled the number of countries where handset owners can purchase apps and also added regions for in-app advertising support. Developers will also have more distribution options to allow users to test their applications before a final software release. Based on developer feedback, Microsoft is helping programmers with a streamlined app submission process, enhanced reports and new app categories.

Although Windows Phone 7 devices aren’t yet selling well (an estimated 2.5 million units in Q1 of this year) compared to handsets running iOS, Android, or even Samsung’s Bada phones, it’s clear that Microsoft understands a strong ecosystem can help drive sales forward. Unlike first-generation handset launches such as the Palm Pre and the initial Android handset, the G1, Windows Phone 7 smartphones have had a reasonable number of third-party titles available. And supplementing them with Xbox Live games and integration points adds to the attraction. But Microsoft has to keep evolving the Windows Marketplace to steal focus from other app stores such as Apple’s, with its 425,000 titles and 15 billion downloads.

Developers and consumers then, should be happy to hear today’s news from Microsoft. Instead of paid apps available in just 16 countries, a total of 35 are now supported. Developers in these seven new markets can now submit apps: Chile, Colombia, Czech Republic, Hungary, Israel, South Africa and South Korea. Microsoft is adding more app price options below $5 and is now adjusting price tiers on a country-by-country basis to better account for fluctuating currencies. And developers can offer beta versions of their apps to 100 testers for up to 90 days, which could improve overall software quality.

From a consumer standpoint, it could get a little easier to find apps; a common problem among all of the app stores. Microsoft is adding three new top-level app categories — education, kids & family and government & politics — as well as several new sub categories. Special app offers could increase also thanks to hidden app support tool developers can use. By providing a direct, deep link to a hidden app in the Windows Marketplace, for example, programmers may invent clever contests or app giveaways. All of these strategies are likely discussion candidates at our Mobilize event in September, with one panel specifically focused on building a developer community.

Note that all of these changes to the Windows Phone 7 App Hub and Marketplace are in preparation for Mango, the next major software update for Microsoft-powered smartphones. The company will begin accepting application submissions for Mango next month. Microsoft hasn’t yet announced an official launch date for Mango, but today’s news in combination with Mango app submissions starting in August give credence to rumors and leaks of a Mango launch within the next month or two. Once that happens, and new Mango phones arrive from Nokia and others, we’ll then begin to get a real feel for the future of Microsoft’s mobile play.

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