Windows Phone launch was a dud in the U.S. – Is Nokia worried?
The latest numbers from research firm comScore show that Microsoft's (NASDAQ:MSFT) Windows Phone launch late last year in the U.S. market was largely a non-event. This raises the obvious question: Does Nokia (NYSE:NOK) know about this? And is the company concerned?
Based on its surveys, comScore showed the number of Americans who reported owning a Microsoft smartphone (either Windows Mobile or Windows Phone) was around 5.9 million in October. That number dropped to 5.5 million in November and 5.3 million in December. Microsoft launched its overhauled smartphone operating system during November with $200 phones from the likes of Samsung, HTC and LG and with carrier support from AT&T Mobility (NYSE:T) and T-Mobile USA.
Now, since comScore puts both Windows Phone and Windows Mobile into the same figure, it's possible that a large number of Windows Mobile owners swapped out their handset for a new Windows Phone device--but I doubt it. Further, comScore's figures show that Microsoft's market share in the United States continued its gradual decline through February of this year, which indicates the launch of its Windows Phone platform in November has done little to reverse a decline in the company's market share that started at the end of 2009 (right around the time Android got rolling).
These results likely are a serious concern to Microsoft. The company poured significant effort into Windows Phone; the operating system is a ground-up redesign of the company's aging Windows Mobile platform intended to rekindle the software giant's mobile business.
(To be fair, most Americans are signed onto two-year wireless service contracts that make hasty phone changes difficult. Thus, a true evaluation of Windows Phone is problematic this early in the game--and Microsoft has lots of cash to throw at the sector. But I think it's fair to say the company likely was hoping for a bigger splash.)
"While Windows Phone has no comment on the comScore numbers, I encourage you to check out Achim Berg's post from December that outlines Microsoft's position on sales expectations for a first-gen platform," wrote Microsoft spokeswoman Krista Berlincourt in response to my questions on the topic. "Additionally, although sales are an important measure of success, for a new platform customer satisfaction and active developer investment can be even more important leading indicators of long-term success. 93 percent of customers worldwide are satisfied with Windows Phone 7, and 90 percent would recommend to others."
Now, what's really interesting about comScore's figures is the light they shine on Nokia's decision to replace Symbian with Microsoft's Windows Phone as Nokia's primary smartphone platform. Nokia announced its decision in February, presumably after evaluating the success of Microsoft's Windows Phone launch in the United States in November.
Does Nokia believe its brand and its hardware can breathe life into Windows Phone? Nokia has never been a strong player in the U.S. market, and the company has said it hopes to use Microsoft's operating system to break into the U.S. market. But I'm not sure how the addition of a Nokia logo and a few Nokia services will reverse the decline of Microsoft in the United States.
Nokia did not respond to a request for comment on the topic.