Five reasons why Windows Phone 7 will succeed

On Monday, Microsoft marked the formal launch of Windows Phone 7 with a range of devices that will be available from a number of operators around the world starting in November. The revamp of Microsoft’s mobile operating system faces a steep uphill challenge in the face of strong existing operating systems and platforms, and many are writing it off. But there are at least five reasons why Windows Phone 7 will make a big impact in the market.
Significant challenges face Windows Phone 7 as it readies for launch
Windows Phone 7 faces significant challenges in the market. As a smartphone operating system it goes up against Apple’s iOS, Google’s surging Android, Nokia’s widely deployed Symbian operating system and RIM’s BlackBerry platform.
Trying to squeeze into such a crowded market is tough, especially when operators and developers have their hands full with the existing platforms, and many existing smartphones are flying off the shelves.
In addition, smartphone operating systems face a special challenge today that Windows Mobile didn’t in previous incarnations: the success or failure of a platform depends largely on its appeal to developers. Our developer survey indicates that developers typically write for just three platforms, which means that for many developers Windows Phone 7 will have to displace another existing platform. This will be challenging when other platforms have established channels and application stores, and large addressable markets.
But Microsoft is well placed to take its share of the market
However, Microsoft is well placed to take significant share of the market, for several reasons:
  • Microsoft knows developers and how to support them. Windows Phone 7 is far from Microsoft’s only development platform, and there are armies of developers who already write for its other platforms. Since Microsoft is using some of the same tools that are already used for Xbox, Silverlight, and .NET development, the transition will be an easy one for at least some. In addition, Microsoft has resources, experience, and marketing muscle that will help it reach developers and keep them happy as it rolls out Windows Phone 7.
  • Microsoft “gets” consumers. It has become a popular pastime to poke fun at Microsoft as a failure in the consumer market – its Zune MP3 player has had a fraction of the success of Apple’s iPhone, for example. But such a storyline ignores its huge success in the online gaming space with Xbox, and of course its enormous installed base of operating systems, office suites, and other consumer software across the world.
  • Integration with other Microsoft services. Here again Xbox is a key component, since Windows Phone has deep integration with the Xbox Live platform and will therefore create a unique gaming experience on smartphones. However, it goes much further than Xbox, into Office applications including Outlook, OneNote, and other Microsoft products. Microsoft’s Windows Live (MSN, Hotmail, Bing Maps, and others) services give it an advantage over Apple, RIM, and Nokia – Microsoft is arguably stronger in online services than its competitors. Other platforms rely on third-party applications or other indirect interfaces with these products, and only Microsoft can create baked-in, native support and integration with them.
  • Differentiation. Although Microsoft is entering a crowded market, it has done well with Windows Phone 7 to differentiate itself from the competition. Unlike Android, it has not and will not attempt an end run around the carriers, and its OS play is not a means of dominating the mobile advertising space. In addition, the user interface in Windows Phone 7 is refreshingly different from the other platforms, with its use of tiles instead of small app icons as the main motif. Thus, it should appeal to device vendors, carriers, and developers as an alternative to Android.
  • Money. Though some might bristle at it, a major reason why Microsoft is likely to succeed is its sheer scale and financial muscle. It will be putting significant resources behind the marketing of Windows Mobile 7 to consumers, but will also make financial guarantees to both developers and OEMs to help them commit to supporting the platform on a low-risk basis.
This clearly separates Microsoft from Google, which has provided some carriers with financial support for marketing but has otherwise left its platform to speak for itself with both customers and end users.
Despite all these factors working in Microsoft’s favor, it will still have to work phenomenally hard to make a success of its new operating system, and there are plenty of ways in which it can fail. If it does fail, having already seen Windows Mobile lose relevance and the Kin flop completely, this may be the last time it ventures into the mobile operating system market.
But our developer survey indicates strong interest from developers in either continuing to develop for a Microsoft mobile OS or doing so for the first time. Operators will be happy to have an alternative platform to put pressure on Apple, Goggle, and Nokia, and our forecasts predict Microsoft will put in a strong showing as one of a handful of major smartphone operating systems for several years to come.