Windows Phone 7 offers users a unique take on the smartphone. But Microsoft still needs ideal marketing, apps development and price to create a hit.
Microsoft launched Windows Phone 7 with a New York City
event Oct. 11 and hopes that the smartphone platform will attract customers who
would otherwise gravitate toward the Apple iPhone or a Google Android device.
As opposed to those platforms, which offer grid-like screens of individual
apps, Windows Phone 7 aggregates Web content and applications into six
subject-specific "Hubs," such as "People" and "Games."
A shiny user interface, however, won't be the sole
determinant of whether Windows
Phone 7 succeeds in the marketplace
. If Microsoft wants to reverse its
steadily declining share of the smartphone market, it will need to rely on some
key factors swinging in its favor.
It's the apps, stupid. At a
time when Apple's App Store is reportedly coasting toward 300,000 apps, with
Google's Android Marketplace making some substantial gains of its own,
Microsoft will need a robust apps ecosystem with Windows Phone 7 if it wants
the platform to prosper.
Microsoft realizes this. Throughout the summer, various
executives touted the virtues of Windows Phone 7 at developer events. "Give us
your games, your productivity programs, your mobile business apps yearning for
a new audience," went the message, "and we will give you a new channel from
which to profit." For any developer still unconvinced, it seemed, Microsoft
was also reportedly willing to offer hard, cold cash.
"We are investing heavily in the developer community by
offering as many resources as we can to help them be successful on our
platform," a Microsoft spokesperson wrote to eWEEK July 14, in response to
questions about whether the company was paying third-party developers for apps.
"Where it makes sense, we do co-fund strategic projects on a limited basis."
On Aug. 17, Microsoft posted a series of online training sessions,
hosted by Microsoft MVPs Rob Miles and Andy Wigley, intended to help developers
create applications for the platform. The 12, 50-minute sessions covered
topics such as "Advanced Application Development" and "Marketing Your Windows
Phone 7 Application."
Microsoft has specific internal targets for the initial size
of its application storefront, but remains reluctant to share those numbers
publicly. "We're really focused on quality; we have pretty lofty aspirations,"
Brandon Watson, Microsoft's director of developer experience for Windows Phone
7, told eWEEK in a Sept. 15 interview. "We have to show developers that they
can build applications, that they can make money. So we're really focused on
the quality of the applications."
During Windows Phone 7's Oct. 11 launch event, Microsoft
highlighted apps from big brands such as Netflix. But the smartphone's ultimate
fortunes could rest more on whether smaller developers decide to port their
wares over, as well-a handful of killer apps could make the platform that much
more enticing. On the plus side: Windows Phone 7's Xbox Live integration could
help attract users, which in turn could entice games-centric
The Marketing Push
Microsoft already seems to have this one in hand. Deutsche
Bank analyst Jonathan Goldberg previously estimated the initial cost of the
Windows Phone 7 marketing campaign at $400 million
, and carriers' own
advertising initiatives would only add to that amount. While Microsoft itself
remains tight-lipped about any numbers, it's unlikely that the company will
skimp on its marketing dollars-especially with so much at stake.
first advertisements for Windows Phone 7 seem to focus on a singular theme
hordes of zombie-like smartphone users wander the streets, hopelessly absorbed
with whatever's happening on their devices' screens, even as they collide with
street signs, random objects, and each other. "It's time for a phone to save us
from our phones," intones the narrator. Will that be enough to convince
potential smartphone owners to side with a Windows Phone 7 device, instead of a
Google Android smartphone or Apple iPhone? Time will tell.
As Windows Phone 7's premiere U.S. carrier, AT&T will
introduce three devices in November: the LG Quantum ($199), which features a
slide-out QWERTY keyboard; the HTC Surround ($199), with a slide-out speaker
and kickstand; and the Samsung Focus ($199), which the carrier claims will be
the thinnest of the initial Windows Phone 7 devices.
In total, Windows
Phone 7 will appear on nine devices during its initial release period
Although Microsoft has tried to impose strict hardware requirements on its
manufacturing partners-all Windows Phone 7 devices are supposed to have three
mechanical buttons, for example-those OEMs have evidently pushed back a little,
adding features such as the aforementioned speakers and sliding keyboards.
Microsoft is likely anxious to avoid the fragmentation issues that plagued its
Windows Mobile franchise, which confused potential buyers with a wide variety
of phones and operating-system versions.
But any concerns over hardware could be moot if the price
isn't right. While AT&T's prices seem comparable to competing devices,
Microsoft will need to ensure that hardware and data-plan costs remain
competitive as more carriers introduce Windows Phone 7 devices in the months
ahead. As Microsoft's Kin debacle demonstrated earlier this year, an overpriced
product is quickly doomed.
Business users constituted one of the hardcore segments for
Windows Mobile, even as Microsoft's share of the smartphone market began to
precipitously decline. And while Microsoft is touting the consumer-centric
aspects of Windows Phone 7, it will still need to pay attention to those
enterprise and SMB customers-lest they gravitate towards RIM's BlackBerry, or
the increasingly business-robust iPhone and Google Android.
However, it could prove a hard road. "Business users [are]
the core of the previous Windows Mobile constituency, but many have defected
over the past year," Jack Gold, primary analyst for J. Gold Associates, wrote
in an Oct. 11 research note. "It is unclear whether Microsoft can win them
back, or even keep the existing, albeit significantly diminished, base of
Microsoft's Windows Phone 7 strategy for business centers on
its "Office" hub, which features SharePoint integration along with a variety of
mobile-productivity apps. The company is also rushing to build out the
smartphones' user interface with more productivity elements. "Pretty much in
the next round they have to deliver cut-and-paste, multi-tasking and allow
developers to get at the database inside the devices now," Al Hilwa, an analyst
with IDC, wrote in an Oct. 11 research note. "This will be important as they
fold the enterprise strategy back into [Windows Phone 7], which was clearly
where Windows Mobile was successful."