Windows Phone: The mobile world's third wheel

Bottom line, in almost four years Microsoft has accomplished little more with Windows Phone than becoming the mobile world's third wheel. The best way to change this is for Microsoft to embrace the competition -- Android.
Written by Adrian Kingsley-Hughes, Senior Contributing Editor

While no one can doubt that Windows is the platform that controls the PC landscape, when it comes to the mobile arena, Microsoft is a small fish in a very large ocean dominated by Android and, to a lesser extent, iOS.

Windows Phone was announced more than four years ago, and made its initial debut in the US in November 2010. During that time the platform has grown from zero to grab a 3 percent market share. This figure is backup up by reports from Canalys and ABI Research.

Bottom line, in almost four years Microsoft has accomplished little more than becoming the mobile world's third wheel.

Android on the other hand is booming, dwarfing the competition with an 81 percent share of the smartphone market (excluding basic mobile handsets), a number supported by both the Canalys and ABI Research reports. Apple's iOS is holing its own with a sub 20 percent (which doesn't seem much until you realize that this figure is for a single brand – the iPhone).

Bottom line, in almost four years Microsoft has accomplished little more than becoming the mobile world's third wheel.

Now don't get me wrong, I think the Windows Phone operating system is an excellent platform, and it brings a number of innovations to the table. It's also currently the only viable third ecosystem since the disintegration of BlackBerry. If you want something other than Android or iOS, then Windows Phone is pretty much all there is.

It's pointless debating why Windows Phone hasn't been the hit Microsoft expected it to be. There's been enough finger-pointing at the confusion over the branding, the lack of developer support, Microsoft's lateness to the market with a platform, and the overall lack of visibility of Windows Phone-powered handsets. What matters is what the future holds for the platform.

Barring a miracle, I can't see Windows Phone posing any serious threat to either the iOS or the Android platforms. Both platforms are too well established, have too much market traction, and are too widely supported by developers to have much to fear. The best I think that Microsoft can hope for is to snag a few percentage points here and there.

But what about all those folks wanting to upgrade from basic handsets to smartphones? Surely there's an opportunity there? Well, there may be, but the data as it stands isn't promising.

"Interestingly, basic mobile phones lost 5% market share and Android picked up almost all of these users, suggesting Android is set to gain almost all of the billions of mobile subscribers still upgrading to smartphones. Certainly, Android looks set to completely dominate the high growth developing markets and increase its market share still further," said Nick Spencer, senior practice director, mobile devices at ABI Research.

In other words, don't bet on it.

So, what's left for Microsoft?

If you can't beat them, join them. And by them, I mean Android.

Microsoft doesn’t have to abandon Windows Phone to embrace Android. It can still keep the project alive, and perhaps even work to further integrate Windows Phone with the Windows platform. Over time this might lead to something.

Or it might not.

In the meantime, Microsoft can load Android on a select number of Nokia handsets, handsets that have been customized to point to Microsoft services rather than those offered by Google, and as users partake of those services, so the dollars will slow to Microsoft.

And at the bottom of all of it, that's what Microsoft cares the most about. While market share and dominance offers bragging rights – and the chance to better steer the ecosystem – it's money that really drives a corporation. And it doesn't matter if that money is coming from Android devices, because money is money and it all spends the same.

But even this route is not without its difficulties. For example, Microsoft's Android handsets won't have access to the vastness of the Google Play store.

If Microsoft can put ego aside, Android gives it the opportunity to gain a foothold in the mobile space. At the very least, Android gives it an opportunity to pull in some mobile dollars.

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