It's not game over for Windows Phone--at least not yet


Phil GoldsteinNEW ORLEANS--For the past few weeks it may have seemed like Microsoft's (NASDAQ:MSFT) Windows Phone platform was on the run. Nokia (NYSE:NOK), Microsoft's key partner, posted disappointing first-quarter results and sold only two million Lumia Windows Phone smartphones in the quarter. Then LG Electronics said it would focus more on smartphones running Google's (NASDAQ:GOOG) Android, and put Windows Phone on the back burner. And finally, Samsung, now the world's largest handset and smartphone maker, unveiled its latest flagship Android phone, the Galaxy S III.

However, from what I've read and heard here at the CTIA Wireless 2012 conference, rumors of Windows Phone's demise are greatly exaggerated. Microsoft has a window of opportunity--one that will perhaps open in the late summer or early fall and close by early next year--to work with carriers and handset makers to make Windows Phone stick. After that point, the platform may truly wither on the vine.

What makes me optimistic, or at least open-minded? Carriers and OEMs seem content to wait until Windows Phone 8, dubbed "Apollo," comes out, likely sometime in the third quarter, before jumping on the Windows Phone bandwagon. When that happens, it appears they may be ready to place their bets on the platform as the third ecosystem to compete with Apple's (NASDAQ:AAPL) iOS and Android.

Representatives from HTC and Samsung told me they're still fully committed to the platform, even though Android represents a large share of their portfolios. "It is a very compelling operating system," Kevin Packingham, senior vice president of product innovation for Samsung Mobile, told me. "It has a lot of potential both here in the U.S. market and globally. We think there is a lot of opportunity."  

Nokia's Chris Weber, president of the Americas, obviously has a stake in seeing Windows Phone do well. He told me he was not perturbed by Samsung undercutting Nokia's $100 Lumia 900 with its $50 Focus 2 Windows Phone at AT&T Mobility (NYSE:T). The attitude seems to be the more the merrier, and I tend to agree with that. The more Windows Phones that actually find their way into consumers' hands, the better for the platform, regardless of the thin margins right now.

It's not just the OEMs that are excited though. Carriers seem ready to hop on board. Verizon Wireless (NYSE:VZ) has already said it wants to do for Windows Phone what it did for Android--but that it will wait for Windows Phone 8 before doing so. Matt Stoiber, senior vice president of Cricket provider Leap Wireless' (NASDAQ:LEAP) devices business, told FierceWireless Leap is in final discussions with Microsoft and unnamed device vendors to sell prepaid Windows Phone 8 devices sometime later this year or early next year. Additionally, David Owens, Sprint Nextel's (NYSE:S) director of consumer acquisition, told PC Magazine that he's "still bullish on Apollo."

Apollo is rumored to support multi-core processors, four different screen sizes and Near Field Communications technology, which would all be welcome enhancements to the platform. It seems like carriers and OEMs are willing to give Microsoft one last shot to make the platform fly with Apollo. For the moon shot to succeed though, carriers are going to have to roll out major marketing campaigns and OEMs are going to have to deliver products that are both high quality and relatively low cost to compete with new Android devices and likely a new iPhone. If that push is sustained and strong, it could work. If not, the platform will face an even more serious situation than it does now.

Microsoft had less than 4 percent of the U.S. smartphone market as of March 2012, according to comScore. To turn that around, it's going to have to deliver with Apollo. It might seem impossible, but then again, we did land a man on the moon. --Phil

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