Microsoft will spend about $400 million to promote the launch of its forthcoming Windows Phone 7 operating according to Deutsche Bank analyst Jonathan Goldberg, adding his forecast doesn't include the millions the software giant has already committed to pay its handset manufacturer partners to offset non-recurring engineering costs. Goldberg derives his estimate based on conversations with Microsoft brass during a recent visit to the company's Redmond, Wash. headquarters, with execs anticipating that overall spending will reach billions of dollars once its operator and manufacturer partners' marketing spending is factored into the equation. TechCrunch adds that according to another source, Microsoft will invest more than a billion on WP7's launch, half of promotion and half on other development costs.
"This is make-or-break for them. They need to do whatever it takes to stay in the game," Goldberg says. "It's still wide open. They don't have to take share from Android or Apple, so long as they can attract enough consumers switching from feature phones."
Microsoft will release the final version of its Windows Phone 7 Developer Tools on Sept. 16, enabling developers to recompile their WP7 applications and games prior to the early October relaunch of the Windows Phone Marketplace storefront. Last month Microsoft confirmed reports it is offering financial incentives to developers to stir interest in new WP7 applications, with senior director of mobile services and developer product management Todd Brix telling Bloomberg the company is providing everything from free tools and trial handsets to software development funding, even offering revenue guarantees in the event apps fail to sell as expected.
Brix declined to state how much Microsoft will spend to woo developers to WP7, but said it is a larger sum than the company invested in previous compensation programs. "We are investing a lot to attract developers big and small to Windows Phone 7 to let them understand what the opportunity is and provide as many resources as we can to help them be successful on our platform," Brix said. "We're open for business and we want to work with them."
For more on Microsoft's WP7 marketing efforts:
- read this TechCrunch article
Microsoft paying developers to build apps for Windows Phone 7
Microsoft adds new web experiences to Windows Phone 7
Windows Phone Marketplace adds private beta distribution
Microsoft cuts Windows Phone Marketplace app submission fees