Microsoft takes a beating over mobile OS

Microsoft has taken a beating during the last month or so, over the Windows Mobile platform. The company has lost marketshare in that space to the likes of Apple, RIM and soon Google, with its Android platform. Should the computer software giant put its mobile OS out of its misery?

Microsoft keeps insisting that it won't end things, despite the fact that its market share has now fallen to 9 percent, according to Gartner. Earlier this month, Robbie Bach, Microsoft's president of the entertainment and devices division, admitted that the Windows Mobile platform has faced a struggling year, but predicted that the new Windows Mobile 6.5 OS will bolster the company's position.

"You will have a very rich browsing experience on [Windows Mobile] 6.5 devices," Bach told analysts during a recent financial briefing, according to ZDNet. "It will give you access to more websites than you will be able to get to on an iPhone that will work actively and work well. It really is a much better experience." WinMo 6.5 is slated for release this fall in conjunction with the introduction of Microsoft's Windows Marketplace for Mobile application storefront.

"The fundamentals of our strategy are based on the idea of choice and selection," Bach said. "It is our view that one model, one type of phone is not going to build volume into that critical mass that we think we need to make the business successful. We have people who are going to want Qwerty keyboard, touch keyboard, big screen, people who want small screens. People who will make trade offs on battery life to do media. So it is our view we need to work closely with Samsung, LG, HP, HTC, Sony Ericsson and others to build a broad selection of phones with different price points and different functionality."

But it's becoming more apparent that WinMo 6.5 is simply a way to buy time for WinMo 7, which is supposed to be the platform that actually leapfrog's the iPhone and Android platforms. According to DigiTimes, unnamed sources at handset makers are saying that Microsoft will launch Windows Mobile 6.5 on Oct. 1 and then add an upgrade to the software platform in February 2010 that will feature a touch interface. WinMo 7 won't be available until the end of 2010, and Microsoft won't phase out WinMo 6.5, but instead reduce the price of WinMo 6.5.

The question is: Will developers and handset makers be attracted to WinMo 6.5 in hopes that WinMo 7 will blow the competition out of the water--more than a year from now?

Maybe that's the question Microsoft is asking as it has made some interesting announcements to get its software on competing devices. Just last week Nokia and Microsoft announced a partnership that creates a mobile version of Microsoft Office on Nokia smartphones based on the Symbian platform. The agreement calls for Microsoft and Nokia to jointly design, develop and market productivity solutions targeting mobile professionals, bringing Microsoft Office Mobile and Microsoft business communications, collaboration and device management software to a range of smartphones, beginning with Nokia's Eseries portfolio--the companies will also team up to market the solutions to businesses, carriers and subscribers.

The deal raised questions about the future of WinMo. "Despite loud protestations that Microsoft is deeply committed to WinMo, they wouldn't have needed this alliance with Nokia if WinMo were the leading smartphone operating system," wrote Gartner analyst Nick Jones in a blog post on the agreement.

And yesterday, the software giant launched OneApp, which allows cheaper devices from Nokia and Sony Ericsson to access social networking services, including Windows Live Messenger.

As Jack Gold, founder and principal analyst with J. Gold Associates, wrote in a recent Business Week piece, Microsoft can make some nice change in the markets it already dominates: Productivity, email and collaboration software with its Office and Exchange products. He believes Microsoft will exit the mobile OS business in at least two years. Given the ramp up of Android devices, WinMo 6.5 simply has to do the trick or there might not be a prayer for its mobile OS position regardless of how revolutionary WinMo 7 might be. - Lynnette