Windows Phone sales are falling in the U.S. and China, according to new survey

Joe Belfiore, corporate vice president and manager for Windows Phone, holds Windows phones as delivers a keynote address during the 2014 Microsoft Build developer conference on April 2, 2014 in San Francisco, California. (Photo by Justin Sullivan/Getty Images)

Windows Phone is no longer growing in the United States and China, according to a new consumer survey study published by Kantar Worldpanel ComTech on Monday. In the United States, China, and Germany, Windows Phone’s percent of sales share was down when compared to this month last year. This means in Windows Phone’s fifth year, the platform is having difficulty in the two largest smartphone markets in the world.

In the United States, Windows Phone accounted for 3.8 percent of smartphone sales during May 2014 — a decline of .9 percent over this time last year, when Windows Phone accounted for 4.7 percent of smartphone sales. Windows Phone did even worse in China, collapsing from a weak 3.0 percent in 2013 to 0.06 percent this year. Android dominates in China, with about 83 precent of smartphones sold there in May running the operating system.

Windows Phone sales percentages were also down in Germany. But across Europe’s five big markets — Germany, the United Kingdom, France, Italy and Spain —  which make up the historical Windows Phone stronghold, Windows Phone remains third after iOS and Android, accounting for 8.1 percent of phones sold, which is up from this time last year but down from January 2014.

To be clear, the study measures the number of handsets sold per month that run the operating system, not device ownership as a whole. It’s possible that Windows Phone has some big sales months based on when new devices come out and that Kantar was simply estimating the month of sales that looks the worst for Microsoft’s mobile operating system.

What is clear, though, is that Windows Phone is finding it hard to compete in high-end markets like the United States. There are a few great Windows Phone handsets that match up against the iPhone and Galaxy S5, like the Nokia Lumia 1520 and the Lumia Icon. But there aren’t multiple companies building high-end Windows Phone devices, as is the case for Android, and the slightly different versions of Nokia’s high-end device for each individual carrier means the platform doesn’t have the same marketing impact that Apple does. Meanwhile, the Windows Phone app store, while improving, still lacks official apps for services like Uber and Tinder.

Microsoft’s current Windows Phone strategy appears to be targeting the low end of the market by waiving licensing fees while also building low-end Nokia smartphones that echo the ubiquitous Nokia stick phones. Because the Kantar study doesn’t include India or other large emerging markets — aside from China, which is its own beast — it’s hard to tell whether that strategy is working. Recently, research firm IDC said that in its long-term forecasts, Android will continue to be the platform of choice for low-cost handsets. With the new Android One program, Google is making it a priority to have some kind of control over the “next billion smartphone customers.” That is the market that should matter to Microsoft.

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