NEW YORK--Microsoft (NASDAQ:MSFT) has no current plans to build its own Windows Phone smartphone and would only do so if partners like Nokia (NYSE:NOK) and HTC are not making the most of the platform and addressing the market.
Terry Myerson, corporate vice president of Microsoft's Windows Phone divison, discusses Windows Phone.
"It would have to be something where Nokia or HTC or one of our primary partners was not providing the consumer experience we think is possible with our platform," Terry Myerson, the corporate vice president of Microsoft's Windows Phone division, said here at AllThingsD's D: Dive Into Mobile conference.
Nokia said in March that if Microsoft builds its own branded Surface smartphone, the move could hurt Nokia's business.
"Microsoft may make strategic decisions or changes that may be detrimental to us," Nokia acknowledged in a recent Securities and Exchange Commission filing. "For example, in addition to the Surface tablet, Microsoft may broaden its strategy to sell other mobile devices under its own brand, including smartphones. This could lead Microsoft to focus more on its own devices and less on mobile devices of other manufacturers that operate on the Windows Phone platform, including Nokia."
Myerson said that all of Microsoft's energy is focused on its partners. "We want the partners building Windows Phones to be successful with Windows Phones," he said, noting that Microsoft is not pushing aggressively to add more OEM partners (other Windows Phone manufacturers include Samsung Electronics, Huawei and ZTE). "We're very focused on making our core partners successful right now."
The Microsoft executive also said the company is finding more traction with its Windows Phone platform in markets where operators do not subsidize smartphones, a situation he said doesn't garner much media attention. Myerson repeatedly said that Windows Phone is like a "well-funded startup" inside Microsoft.
Myerson said that Apple (NASDAQ:AAPL) and Samsung build their best devices for $650, prices that are reduced by carrier subsidies to $200 or so. "If every phone is [subsidized down to] $200 regardless of what price it is, then we're the challenger going up the incumbents at the same price," he said. "That as a playing field is a little harder."
Microsoft has had a tough time gaining traction with Windows Phone. Research firm Gartner reported that Microsoft captured 3 percent of the global smartphone market in the fourth quarter of 2012, up from 1.8 percent in the year-ago period. IDC reported similar numbers, giving Microsoft 2.6 percent of the global smartphone market in the fourth quarter, up from 1.5 percent in the fourth quarter of 2011.
In a bit of a light-hearted note, Myerson said the he enjoys working for Microsoft CEO Steve Ballmer, and said he is an "intense but loveable everyday guy. I love the guy."
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