Is Google's Android Killing Windows Mobile?

Earlier this morning, I got a chance to catch up with Dr. Sanjay Jha, co-CEO of Motorola (s MOT), soon after his company reported earnings (they met Wall Street’s modest expectations) to talk about everything from the state of the mobile market to prospects for Motorola. I will write all that up in a longer post, but there was one part of the conversation that stuck with me as it was very telling about the momentum around Google’s Android and the detrimental impact it’s having on Microsoft’s Windows Mobile.

As part of our conversation, Dr. Jha stressed that handset makers need to pick a single smartphone OS and devote resources to it in order to win. He pointed to Nokia and Symbian, Apple and its iPhone OS and RIM’s BlackBerry OS. He used that logic to justify why his company was betting the farm on Google’s Android. Why? Because it’s the best option for the company right now.

“I didn’t have any other compelling option,” he said. “The other OS got pushed.” I asked him if he was talking about Microsoft’s Windows Mobile or the LiMo operating systems, but Dr. Jha proved to be too polite to name names and reveal more details. Microsoft’s Windows Mobile 6.5 had been scheduled to make it out of the chutes by May, but won’t hit the market till October.

From what we’ve heard, there aren’t any Windows Mobile-based devices in Motorola’s line-up for 2010, so it’s reasonable to say that Windows Mobile has lost favor at Motorola. Back in February, The Wall Street Journal reported that Motorola was going to cut its ties with Windows Mobile. At the time, the handset maker denied any such moves. A month earlier, however, I hinted at Motorola backing away from Microsoft-based handsets.

Like upstart HTC, a long-time Windows Mobile loyalist, Motorola is focusing its development resources behind Google’s Android OS. Both HTC and Motorola are developing their own user interfaces for Android, which indicates their seriousness about Google’s mobile platform. I wonder if this is going to be a trend that’s going to spread. From what I’ve heard, everyone from Lenovo and Huawei to Dell to Samsung are betting on Android. These companies would have been partners of Microsoft in the past.

I feel Microsoft wasted away many years while it held the top position in the mobile handset business. Microsoft CEO Steve Ballmer recently told analysts that, “It was a tough year on succeeding with phones, mostly our own issues, frankly.”  (via The Washington Post). Robbie Bach, president of Microsoft’s entertainment and devices business, was more candid, and admitted to problems with Microsoft’s mobile strategy in a meeting with financial analysts and investors. Bach reported that Microsoft’s share of the mobile phone operating system market had declined despite the fact that volumes were up a tad. Microsoft claimed that 20 million Window Mobile phones were sold in 2008.

“To date, we haven’t done as good a job as I would like building relationships and getting the right integration with our hardware partners…You’re going to see dramatic improvement in integration.”

“It is our view that one model, one phone is not going to build volume,” he said. “People are going to want different configurations on their phones. We need to work very closely with Samsung, Sony Ericsson and others to build a broad selection of phones that provide a choice of different pricepoints and different capabilities.”

Funny there wasn’t any mention of Motorola! I wonder if it will be too late for the company to make a comeback, similar to Zune struggling to play catch-up with the iPod. So while there is a lot of focus on Apple vs. Google, the real battle is actually between Microsoft Windows Mobile and Google Android. It looks like Google has drawn its first blood.

(Dr. Jha will deliver a keynote speech and discuss Motorola’s bet on Mobile Internet in our mobile Internet-focused conference, Mobilize 09, that will be held in San Francisco on Sept. 10.)