In the PC market, Microsoft’s Windows OS is as common as the mobile phone in your pocket. However, Windows Mobile has struggled to capture the imagination of both consumers and businesses. In fact, with a rapidly declining 5% [1] of the global smartphone market it’s fair to say that relatively speaking Windows Mobile has been a horrible failure. But that’s all about to change.

Recent research by GfK NOP [2] shows that interest in Windows Phone 7 (the catchy name given to the successor of Windows Mobile 6.5) is strong. Almost one in five (18%) of UK mobile phone owners say they would consider a Windows Phone 7 (let’s go with WP7 from here on in) handset (available on HTC and Samsung devices among others) when they next come to renew, upgrade or buy their next mobile phone. Of course current smartphone owners display much higher levels of interest (32%). What’s more, Microsoft will be pleased to hear that of all smartphone owners, those using Google’s Android will be most interested (41%) in WP7. So what’s changed?

One smartphone for all needs

New entrants into the smartphone business, such as Apple and Google (Android), have been quickly gaining market share from older incumbents such as Nokia, Microsoft and Palm. There are many reasons for this but one of the underlying factors is that smartphones developed by Apple and Google satisfy a broad array of consumer needs, including needs consumers didn’t even know they had.

This is a big sea change to the range of smartphone offerings available as recently as four to five years ago. Microsoft, Palm and RIM targeted their phones squarely at the business user while in the consumer market there was a portfolio of highly targeted phones; one for music lovers, one for mobile gamers and so on. The iPhone and the numerous Android based smartphones are designed to not only satisfy the broad range of consumer needs (music, gaming, email, maps, productivity etc.), they are also becoming attractive solutions in the enterprise market. Importantly, the content available on their respective app stores creates a sense that anything is possible.

The key to Apple and Google Android’s success is that they do a lot of things really well and don’t just rely on certain core services. Microsoft has recognised the success of this formula and WP7 has a plethora of pre-installed services and marketplaces from which to download apps and media content. This makes their smartphones an attractive solution to a broader market of consumers and enterprises.

Stephen Fry [3] summed this up perfectly at the launch event of WP7:

“[people are not] one thing when they’re outside work, and another when they’ve gone through the swipe barrier” … he went on to say … “Now, they get it [Microsoft]: that all human beings are human beings first. You don’t judge the machines you use, or the houses you live in, by listing their functions. The first thing you do is say how you feel about your office; when you buy a house, you do it essentially on the feeling.”

Why Windows Phone 7 will be a success

This sentiment is reflected in the drivers of interest for Microsoft’s new WP7 platform. We presented and described the new features of WP7 to those who were interested in the new smartphone platform. Very few respondents selected just one feature and the results show a fairly even spread across many of the announced features. Despite email and Outlook integration being the most popular (52%), search and maps (43%), the Office hub (41%) and all the multimedia features take a significant share of the appeal of the new platform.

With the smartphone market becoming ever more competitive, providers will be looking for new ways to differentiate. Of course, different app stores have varying levels of content, there are ease of use drivers and brand effects but there are other ways. Each smartphone provider has a portfolio of digital properties that they can use to differentiate. Apple has iTunes, Android has Google Maps Navigation and a wide array of Google services, and Nokia has Ovi. WP7 also has an incredibly strong offering when it integrates many of Microsoft’s digital services on a smartphone device. Microsoft Office, used by the vast majority of consumers, is seamlessly integrated into the new platform. There is obviously full support for Microsoft Exchange with Outlook integration, XBOX 360 gaming arena, Bing search and maps, and Zune marketplace for music and videos.

All this makes Windows Phone 7 an attractive solution before the consumer has even browsed the app store. This is what makes WP7 so compelling; Microsoft has finally taken its strength in the PC/online market to the smartphone!

 

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[1] Mobile operating system market share http://www.gartner.com/it/page.jsp?id=1421013

[2] 881 online interviews were conducted by GfK NOP among a UK representative sample of internet users. The fieldwork was conducted between 22^nd – 25^th October 2010

[3] Stephen Fry’s comments http://www.guardian.co.uk/technology/2010/oct/12/stephen-fry-windows-phone-7

IMAGE SOURCE:

http://www.microsoft.com/presspass/presskits/windowsphone/images/wp7logo_web.jpg

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3. Youth Smartphone Acquisition Drivers: Affordability, Sociability and Innovation

Tags: Android, App Store, Apple, Blackberry, Consumer, Digital Music, Ecosystem, Handsets, iPhone, Market Share, Microsoft, Mobile OS, Mobile Services & Apps, Nokia, Palm, Research, RIM, Smartphones, Social Networks, Windows, Windows Phone 7, XBOX 360