Microsoft’s Windows Phone Strategy

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One of the most controversial topics in technology, at least by my reckoning, is exactly what Microsoft’s Windows Phone strategy should be. Industry pundits take a number of positions, such as the notion that Microsoft should abandon Windows Phone for Android, that they should glom onto Android designs to gain traction in smartphone hardware (e.g., HTC’s One M8 for Windows), and even that they should stay the course and continue on as they are in their attempt to bootstrap Windows Phone market share.

As someone who’s committed to transitioning to all-Microsoft products, I’m quite sensitive to Windows Phone’s prospects. So far, I’ve enjoyed it immensely, but can’t help feeling at times that I’m following the same path as when I jumped into webOS with both feet. I could be backing the wrong horse, and that can be a disconcerting feeling given my investment in time and money.

Again, I do enjoy using Windows Phone. I like it better than Android, in fact, which is the platform that I migrated to once it was obvious that webOS was barely on life support. I hope that Windows Phone is successful, because I think that Microsoft has created an excellent mobile operating system that in many ways is a superior productivity platform. Windows Phone leverages the smartphone form factor, in my opinion, in a way that neither iOS nor Android can manage. It performs well and it’s secure. If we go by purely technical considerations, then Windows Phone should very well be leading the pack, not struggling to become a strong number three.

However, a number of factors stand in the way of a superior (or at least highly competitive) platform gaining traction in today’s smartphone market. First, there’s ecosystem buy-in, with hundreds of millions of users who are unlikely to switch platforms given their investments in apps, media content, and backend services like iMessage and Hangouts. Then there’s the related issue of market saturation, with one study showing 76% of all mobile phone sales going to smartphones in the US and overall market penetration at 55%. This means that the number of first-time smartphone buyers in the most important market, those that can be convinced to buy into a different platform without the issue of apps, content, and services standing in the way, is becoming smaller every day.

One also can’t forget media coverage, which strongly influences new smartphone buyers towards one of the established players–reading the technology and mainstream press can easily convince someone that Apple and Google are unassailable and that Windows Phone is dead in the water. This could become a self-fulfilling prophecy at some point, with most people in the process of researching which smartphone to buy avoiding Windows Phone simply because it appears to be a losing proposition.

And so, that leaves us with the question of what, exactly, Microsoft can do to make Windows Phone a viable platform. Frankly, I can’t answer that question completely, and I’m not sure that anyone can do so. I remember industry pundits arguing not too long ago that Apple had the smartphone market all sown up with the iPhone and that Android was doomed. And yet here we are, half a decade later (or less), and Android is by many measures the dominant platform. If technology industry has shown us anything, it’s that it’s not all that hard to disrupt.

What I can do, for what it’s worth, is to provide my general opinion on some things Microsoft can do to give Windows Phone a fighting chance. I was prompted to write this post by CNET’s discussion of Microsoft’s tweaking Windows Phone to make it easier for manufacturers to use their existing Android designs for Windows Phone 8.1. That’s an excellent point, and the HTC One M8 for Windows is a good first step toward providing more options at the high-end of the market to go along with Microsoft’s own efforts in pushing Windows Phone into the low-end.

It’s also a result of the desire on the part of many players to maintain an alternative to iOS and Android, something Microsoft can leverage while they work to improve Windows Phone’s standing. From the CNET article:

“Windows Phone has a niche audience,” Reticle Research’s Rubin said. “But what it comes down to is that handset makers like having a hedge. They are uncomfortable being beholden to Google or Apple. They want to keep their options open.”

And so, here are some areas where I think Microsoft can makes some changes.

Stay Global
If Microsoft is making any inroads, it’s in the global market (essentially, everywhere outside of the US), particularly in the low end of the market. Devices like the Lumia 520, 530, and 630 offer or will offer compelling options for first-time smartphone buyers (much more prevalent outside the US) and those on a budget. These buyers can help increase Windows Phone’s market share in absolute terms and provide a larger market to entice app developers, even while it does nothing to help the platform’s perception at the high end.

This means that Microsoft needs to stay global. It needs to increase its penetration of the US market, which will remain ever-important, but it needs to keep up the pressure in markets that aren’t nearly so saturated. No matter what, it remains easier to sell a new smartphone buyer on Windows Phone than it is to convince an iOS or Android user to switch, and it will stay that way until Windows Phone is perceived (and portrayed) as a compelling alternative. The global market simply represents a much larger base of new smartphone buyers and thus should remain a focus.

Increase the Number of Windows Phone Devices
Whether it’s ramping up Microsoft Mobile (what Nokia is becoming) or enticing third-party manufacturers to either convert their Android design to Windows Phone or make new dedicated Windows Phone designs, the market needs fresh new smartphones to choose from. Today, the choices are quite limited, particularly in the US where only the Lumia Icon and the HTC One M8 for Windows, both on Verizon, represent anything approaching new, high-end options. Microsoft’s recent decision to make Windows Phone essentially free to OEMs has had some impact, with fully 17 manufacturers planning to make Windows Phone devices, and hopefully that decision will succeed in dramatically increasing the number of Windows Phones.

Android is successful, I believe and likely without controversy, largely because there are so many options from a number of manufacturers spanning everything from the low end budget device to the high-end halo device. No matter what you’re looking for, whether it’s a smaller, simpler, and economical device or a massive, powerful, and expensive phablet, Android has you covered. In a sense, it’s Android that’s taken the same place in mobile as Microsoft on PCs, beating Apple and iOS in the same way that Windows has historically beaten the Mac–at least in part by simply being ubiquitous. It’s time that Microsoft takes back that strategy.

Improve Carrier Support
A smartphone platform can only be successful if it’s at least an option to the carrier reps who recommend smartphones to buyers online or in person at brick and mortar stores. So far, it certainly appears that Windows Phone is suffering from the same sort of disdain that plagued webOS, with carrier reps either ignoring Windows Phone or explicitly pushing buyers to iOS or Android.

End Carrier Exclusives
The HTC One M8 for Windows is an excellent device, one that I would consider myself if it weren’t for questionably camera quality. However, it’s actually not an option for me, because it’s a Verizon launch exclusive that, so far, only AT&T has fessed up to carrying one day. As a T-Mobile user, my Windows Phone options are horribly limited. As I mentioned in another post, carrier Windows Phones options are as such: Verizon has the HTC One M8 for Windows, the Lumia Icon, the Lumia 928, the HTC 8X, and the Samsung Ativ SE. AT&T has the Lumia 1520, the Lumia 925 (refurb), and the Lumia 1020. T-Mobile has the Lumia 521 (refurb) and the Lumia 635. And Sprint has the HTC 8XT and the Samsung Ativ S Neo.

If Microsoft wants Windows Phone to be successful, then any potential buyer on any US carrier needs to be able to get their hands on the latest and greatest devices. This means pushing high-end Lumia devices to every carrier, something that’s within Microsoft’s control, at least in part, and convincing third party manufacturers to do the same. When I went searching for a Windows Phone on T-Mobile on which to learn and test the platform, I picked a refurbished Lumia 925 because it was the only decent option; had I simply been looking for something new, I guarantee that I would have summarily dismissed Windows Phone given the lack of a good high-end option.

Create the Surface of Smartphones
In PCs and tablets, Microsoft has created a reference design with their Surface line of hybrids. They’re not competing directly against their already-expansive set of manufacturing partners but rather creating compelling devices that point the way in terms of leveraging the strengths of Windows 8.1. The Surface Pro 3 is a stellar example of this strategy, being a powerful, light, and thin device that, in my opinion, is simply the best all-around computing option available from anyone. It’s also very different, pushing the envelope and blazing a path for Microsoft’s partners to follow.

Microsoft’s smartphone strategy could follow the same path, particularly with so many OEMs planning to release Windows Phone devices. The Lumia line could become reference designs, showing what’s possible with Windows Phone while leaving the mainstream options to third-party manufacturers. Indeed, I would like to see Microsoft rebrand Lumia as Surface, with a line of Surface smartphones following the same general design aesthetic as its Surface tablets. Such a strategy wouldn’t preclude the development of low-end devices, in much the same way that Microsoft offers the Surface 2 running Windows RT (which is likely to merge at some point with Windows Phone, solidifying the concept).

Conclusion
I’m not a naysayer who believes that it’s impossible for Microsoft to make Windows Phone successful. Neither am I a Pollyanna who thinks that Microsoft’s standing as an industry leader guarantees their success. Whether it’s made up of my suggestions here or a completely different strategy, however, I do believe that if they’re going to have a snowball’s chance in hell of becoming a competitive third option, Microsoft is going to have to be incredibly aggressive. They’ve done a great job of bridging the app gap between Windows Phone and iOS/Android; now they need to do the same with hardware and carrier support.

 

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