Microsoft Windows Phone 7 Dominated This Week's Headlines

By Nicholas Kolakowski  |  Posted 2010-02-21

Microsoft Windows Phone 7 Dominated This Week's Headlines

Microsoft's week was all about Windows Phone 7 Series, the company's newest smartphone operating system and its most concerted attempt to reverse its declining share in the mobile arena, where it faces fierce competition from Apple's iPhone, Google Android, and Research In Motion's BlackBerry. Microsoft CEO Steve Ballmer indicated during the software's Feb. 15 unveiling at Barcelona's Mobile World Congress that the company would also continue to support its previous smartphone operating system, Windows Mobile 6.5. 

Windows Phone 7 Series takes a different perspective on the smartphone user interface, emphasizing "hubs" that aggregate Web and application content over presenting screens filled with individual applications. That may be an attempt on Microsoft's part to negate its disadvantage in mobile applications: at the beginning of February, its Marketplace for Mobile contained 1,245 applications in all languages, including Slovak and Portuguese; for U.S.-based Mobile 6.x smartphones, the storefront offers around 718 mobile applications. By contrast, Apple's App Store features over 100,000 apps, with research firm IDC expecting that number to expand to 300,000 by the end of 2010.

Those "hubs" include categories such as "People," "Pictures," "Office," "Music & Video" and "Games." The user interface draws obvious inspiration from the Zune HD, Microsoft's portable media player, in its look and touch-screen navigation.

Microsoft's Feb. 15 presentation seemed to focus primarily on the consumer uses for the device, leading a number of pundits and analysts to question whether the platform was suited for enterprise use. While the "Office" hub syncs productivity applications such as OneNote with the user's PC, and includes a baked-in SharePoint server connection, debate sprung up over whether developers would have to completely redesign proprietary apps for the new platform.

"The change will not endear Microsoft to its existing base of corporate users who will redesign and redeploy their apps if they are to utilize this new platform," Jack Gold, an analyst with J. Gold Associates, wrote in a Feb. 15 research note. "We don't think Microsoft can count on many enterprises making such a transition/upgrade, and most organizations will likely stay with older WinMo versions (especially those using ruggedized devices, e.g., Symbol, or those with apps that can't be easily transported.)"

On Feb. 18, the WMPoweruser blog posted what it said were leaked Windows Phone 7 development documents, which indicated that the Windows Phone 7 Series software is built on Silverlight, XNA and the .NET compact framework. 

Microsoft also refused to confirm reports, which originated with Long Zheng and his Istartedsomething blog, that Windows Mobile 6.5 will be re-branded as Windows Phones Classic. Zheng wrote on his blog that he had learned of the shift in an interview with Microsoft representatives, but a Microsoft spokesperson responded to eWEEK about the matter on Feb. 18 with a standard-issue, "Microsoft has nothing to announce regarding any rebranding of Windows Mobile 6.5."

But some analysts feel that the enterprise and SMBs (small and midsize businesses) could both attach themselves to the business function presented by Windows Phone 7 Series.

"The main difference is that companies like Microsoft see the smartphone as a device that can accomplish work; Apple is on the other side, saying that we're going to make media devices that you can use to do most of the things you need to do for work," Charles King, an analyst with Pund-It Research, said in a Feb. 17 interview with eWEEK. "Microsoft is drawing a firm line between what their next-generation smartphones are doing and what other people are doing."

Key to that, King added, is Microsoft smartphones' "easy integration with office productivity apps and easy integration with Sharepoint and Exchange environments."

Microsoft intends to roll out devices running the new operating system at some point before holiday 2010.

Microsoft, Yahoo Clear EU, DOJ

This week, Microsoft and Yahoo also received clearance from the European Commission, the European Union's antitrust regulatory body, and the U.S. Department of Justice to complete their proposed 10-year search and advertising deal.

Under the terms of the agreement, Microsoft will take over Yahoo's algorithmic and paid search platforms while Yahoo tackles sales-relationship duties for a portion of both companies' online search advertisers. Although Bing will become Yahoo's underlying search engine, Yahoo will continue to offer its own branded content and applications. 

"After a thorough review of the evidence, the division has determined that the proposed transaction is not likely to substantially lessen competition in the United States, and therefore is not likely to harm the users of Internet search, paid search advertisers, Internet publishers, or distributors of search and paid search advertising technology," the Department of Justice's Antitrust Division announced in a Feb. 18 statement. "In addition, the proposed agreement likely will enable more rapid improvements in the performance of Microsoft's search and paid search advertising technology than would occur if Microsoft and Yahoo were to remain separate."

The European Commission echoed that sentiment.

"The European Commission has approved under the EU Merger Regulation the proposed acquisition of the Internet search and search advertising business of Yahoo Inc. by Microsoft," the group wrote in a Feb. 18 statement. "The Commission concluded that the concentration would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it."

According to a joint statement issued by both Yahoo and Microsoft on Feb. 18, the companies hope to transition U.S.-based advertisers and publishers before holiday 2010, but "may wait until 2011 if they determine the transition will be more effective after the holiday season." In any case, the transition of all global customers and partners is happen by early 2012.

Yahoo and Microsoft trail Google in their respective portions of the U.S. search market, with Yahoo claiming 15.3 percent in December 2009, ahead of Bing with 10.4 percent but behind Google with 65.4 percent.

Microsoft also confirmed that the Blue Screen of Death issue, reported last week, was linked to malware.

"The restarts are the result of modifications the Alureon rootkit makes to Windows Kernel binaries, which places these systems in an unstable state," wrote Mike Reavey, director of the Microsoft Security Response Center. "In every investigated incident, we have not found quality issues with security update MS10-015." Alureon attempts to access a specific memory location; the issue primarily affected 32-bit machines, according to Microsoft.

But for Microsoft, it was smartphones, and not PCs, that remained the primary focus of the week.

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