Five reasons Microsoft could become a top Android smartphone company

Five reasons Microsoft could become a top Android smartphone company

Summary: I think Microsoft has a real shot of being a top-tier Android hardware company. Yes, I'm quite serious.

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The audience and the judge have spoken in our recent Microsoft and Android debate and they agreed with me that Microsoft/Nokia making Android phones is a smart move. But, can Microsoft give Samsung a run for its money as a top Android company? I think Microsoft might have a real chance of doing just that.

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Microsoft/Nokia's best shot of becoming a major smartphone power is by embracing Android.

Here's why.

1) Microsoft already makes major profits from Android.

How much? Thanks to its patent agreements, Microsoft may have made as much as $3.4 billion in 2013 from Android sales. Heck, if it wasn't for its Android patents, the analyst firm Nomura thinks Microsoft's entertainment and devices division (EDD), which covers Xbox, Windows Phone and Skype would actually lose $2-billion dollars a year!

With its forthcoming Nokia acquisition, Microsoft could make ten times that much from its own Android smartphones. Also, unlike its potential Android competitors, Microsoft won't have to pay its own patent fees. That automatically makes each MS-Android phone more profitable for Microsoft than an equivalent device for say Samsung.

Thinking of the Android phone powerhouse, Samsung owns the Android smartphone market the way Microsoft controls the PC market. Microsoft is one of the few companies with the resources to go toe-to-toe with Samsung. All it needs is to commit to a mobile operating system that people wants.

2) Android already owns the market.

The smartphone OS that everyone wants is Android. IDC's latest fourth-quarter ranking shows Android has more than 78 percent of the worldwide smartphone market.. Between Android and IOS, the powerful mobile OS pair has 95 percent of the market.

I don't care how much you may like some Windows Phones, they're not selling. It's been over a year now Windows Phone 8 was introduced, and it's still not making serious inroads on either Android or iOS.

3) MS-Android has unique advantages over its competitors.

Ask anyone who makes Android phones what their biggest marketing problem is and they'll tell that's it's trying to get their devices to stand out from their competitors. So, they add bloatware, which customers usually hate, or they paint on their own custom interface, which really doesn't look that different from anyone else's front-end.

What's a company to do? Well, if you're Microsoft, it can offer customers, Outlook instead of Gmail; Office 365 over Google Docs; and OneDrive, formerly SkyDrive, in place of Google Drive. Get the idea?

Microsoft has real software-as-a-service (SaaS) and infrastructure-as-a-service (IaaS) alternatives to Google's offerings. While I have no love for Microsoft's applications, there are hundreds of millions of users who have been using Outlook and Office since they first used a computer. A lot of them would love to use the apps they've known since they were kids on a widely-supported platform such as Android.

4) Lower development costs.

I don't know how much Microsoft is spending on building Windows Phone 9, but it's got to be north of a hundred million. How much does it cost to build Android? Oh wait, Microsoft doesn't have to spend a thin dime on creating Android! Google, and other open-source developers, are the ones picking up the tab to build the Android Open Source Project (AOSP).

5) More apps, more developers

Android also already has a huge number of developers and existing applications. In fact, the Google Play store already has a million apps. Windows Phone? It probably just crossed over 200,000 apps. The Android developers are out there, it won't cost them much money or time to bring their apps to MS-Android.

Presto! For far less money, Microsoft cuts its internal development costs and opens its doors to tens of thousands of new developers and hundreds of thousands of new programs.

Conclusions:

Add it all up: If Microsoft gives MS-Android devices a serious push, they can make more money per phone then their competitors. The boys from Redmond will also riding the most popular mobile operating system to market for far less money than they've been investing in their own failed mobile operating system.

Besides, unlike every other major player in the market, except for Amazon with its Kindle Fire tablets, the Windows giant has a unique selling point: Microsoft applications and the cloud services that back them. Last, but never least when it comes to selling smartphones, Microsoft has the potential to immediately quintuple the number of applications for their new Android-based platform over its lagging Windows Phone devices.

I really do think this is Microsoft's smartest mobile move. Look at BlackBerry's example. Once the biggest company in business smartphones, the company is in danger of dying. Its last, best chance of surviving is the forlorn hope that bringing Android apps to Blackberry far too late to market can save the business. Microsoft's far healthier than Blackberry, but its best shot to becoming relevant in the smartphone business is by embracing Android. Then, who knows, Microsoft may finally become a smartphone success.

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Topics: Mobility, Android, Google, Microsoft, Windows Phone

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89 comments
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  • Not going to happen.

    Nokia X series phones will be dumped once the Nokia acquisition is complete. Also android has a weak security model which will be a nightmare for Microsoft if they adopt android in phones. So MS adopting android is not going to happen.
    Owl:Net
    • For goodness sake

      Google uses Eclipse and Android SDK. Windows Phone uses Visual Studio. It would be a nightmare to start using hack Android dev tools when Visual Studio development far superior. Ever wonder why there are so many updates for Android apps? Its because Eclipse stinks at code analysis, collaborative coding, emulator support, and testing tools.
      Sean Foley
      • BING is useless - Nokia fail

        It has no You Tube and none of the basic Android services.

        The most it can accomplish is give Android a bad name. But most of us who know the difference, and we are those who made Android great, we will make sure it does not happen
        Uralbas
        • On the plus side for MS

          I'd it makes Mono part of VS available with the standard VS software and not for 1k more with Xamarin, then I see a problem for Android.

          The best products MS had are VS and SQL server coupled with IIS. This would give Android a tremendous advantage that MS could leverage.

          The current scenario though, replacing sub standard MS alternatives to Google's Services, is simply a no go.
          Uralbas
          • Microsoft will bankrupt by 2020

            Microsoft has no ability to survive in this modern mobile world. Microsoft is so old school their like Kodak. Old companies can not learn new tricks. Microsoft is my grandfather's high tech company. In today's world we have self driving cars. Drones which deliver packages and robots which can balance while walking on ice. Microsoft is a spreadsheet and a word processor. No self driving cars. No robots. They are beaten to every market and that will never change. Microsoft has arthritis in it's joints. Always has, always will. I looked at Amazon's top 100 selling computers and accessories and only 6 products there ran a Microsoft OS while all the rest ran a Google or Apple OS and Microsoft didn't even appear until number 44. I don't see Microsoft making it more than 6 more years before they go bankrupt.
            Tim Jordan
          • Were I a betting man...

            ...I'd take that bet. MS is in decline, but I don't think it's in any danger of bankruptcy and might well turn itself around.
            John L. Ries
          • I'll translate that for you, Tim

            "I'm Tim - I'm a troll, a fake, nothing but a phony shill looking to get someone's cackle's up by posting stuff even I don't believe, as I have to appease myself if I'm to get myself out of bed every morning.

            I fear for Google, as MS isn't dying, but Google's running out of options for revenue, and Apple I don't even want to talk about lest I have a nervous breakdown.

            I'll also leave out the fact that most people buy their Windows PC and tablets directly from the OEM's, so they won't show up in Amazon, so I can spin that to give an illusion that will diminish my anxiety at the though of a healthy MS that just won't die.

            I'm wondering if Google will still exist in 2020, a question many are already asking, and I'm also wondering what parts of a bankrupt Google will companies like Apple and MS pick up at barging basement prices"

            There you go Tim - finally some honesty attached to one of your posts!
            William.Farrel
          • Well

            Both Google and Microsoft will be here in 2020. There would have to be huge disruptive technology to change that.
            schultzycom
          • Disruptive technology?

            Some may remember John Sculley former CEO of Apple credited for firing Steve Jobs. Before Apple, he was President of Pepsi Co and an expert in disruptive marketing. You may recall the blind taste test.

            Now while that campaign was incredibly effective, at no stage did Pepsi overturn Coca Cola's dominant position in sodas. After he left that Pepsi's market share slumped back to former values.

            There is a big difference however between Soda's and high tech ecosystems. Sodas is a market that is mature and almost completely stable, services and ecosystems is a market that is still rapidly evolving. When I gaze Nostradamus like into the crystal ball I see massive disruptions ahead.

            ... to be continued
            gwilo graham
          • I really hope

            That is not your real name you are using, as that prediction is pretty embarrassing.
            schultzycom
          • What are you talking about?

            I just searched amazon for top selling laptops. Number 1:
            HP Pavilion g7-2270us 17.3-Inch Laptop Intel i3-3110M 2.4GHZ Processor, 6 GB RAM, 750GB Hard Drive, Windows 8...

            Maybe my search is wrong: here's the link:
            http://www.amazon.com/s/ref=nb_sb_ss_c_0_18?url=search-alias%3Dcomputers&field-keywords=top+selling+laptops&sprefix=top+selling+laptop%2Caps%2C185&rh=n%3A541966%2Ck%3Atop+selling+laptops

            Where do you get this stuff from?
            bmonsterman
          • Wrong search

            @bmonsterman, you're searching for the literal string "Best Selling Laptops", which returns a lot of random laptop and non-laptop products for me.

            What the OP is referencing is the actual sales ranking on Amazon at http://www.amazon.com/Best-Sellers-Computers-Accessories-Laptop/zgbs/pc/565108. The top two are clearly Chromebooks, and 4 of the top 10 are Chromebooks. The remaining top 10 includes 3 Windows 8, 2 Windows 7, and a Mac laptop.

            Granted, I don't see the results he claims to see either, but Windows 8 has never topped the list - EVER - Chrome has owned the top of the list for the past 15 long months.

            The famed monopoly has ended.
            ricegf
          • @Tim Jordan

            I doubt it. Microsoft is already making billions off of Android now. And BTW they are more than a speadsheet and word processor - but keep telling yourself that.
            athynz
          • Microsoft won't go bankrupt...

            ... like IBM did not go bankrupt when the PC started to rule the world.
            But Microsoft is now so dull and boring like IBM was 30 years ago - but in the opposite to IBM Microsft seems not to be able to innovate (and never did, only clueless people believe that Microsoft was ever innovative).
            hengels
          • You have no idea what you're talking about

            Microsoft has tripled its profits since Ballmer has been CEO, has multiple segments that make multiple billions of dollars, are the #1 enterprise vendor in the world, Azure alone has created a new billion dollar segment, SaaS is strong, Bing is up to 18% and cont. to grow as a search but is also becoming an intracal part of all their technology platforms as a data mining engine, etc. Heck, even Surface is now turning a modest profit and thats not a bad recovery from a huge fumble from last year for a brand new OEM vendor.

            Microsoft is steady and sure and cont. to increase its profits each year.
            Rann Xeroxx
          • don't quit your current job

            And become a stock broker, as you haven't got a clue.
            sjaak327
          • As a user of both MS and Google services

            MS has been the standard, and still is. Google Docs is only useful for basic text documents. Everything about Google is basic, simple. There are no advanced features in Google Apps.
            As for Microsoft, they are constantly improving the online versions, which are very comparable to the desktop versions, and it don't destroy formatting where it isn't as powerful as the desktop version.
            grayknight
        • hmm

          What basic services does Android have that Microsofts will not have.
          schultzycom
        • Bing has hit 18% and growing

          Bing is the only real competition to Google and Microsoft has committed to growing Bing. But Bing is not just a frontend search engine, just like its not for Google either, most of the communication going across the internet is machine to machine, the "semantic web" that we read about years ago. Its about information collection, storing, and mining. If a large tech company is not in this business and have been investing in it today, they are already left behind. This is actually a huge blind sight for Apple.

          There there is the monetization of the client. Microsoft knows that the Windows cash cow is twilighting and moving the monetization away from licensing and to data mining via the Bing engine is part of their overall strategy.

          I have no opinion about Nokia, could be a good investment or not.
          Rann Xeroxx
          • In the US

            Worldwide Bing share must be 1/4 of that and not going anywhere.
            If the future of Microsoft money is Bing I also say they will be bankrupt when that future arrives - obviously they will probably have a nice future without Bing making a dime of profit.
            AleMartin