February 13, 2010

Microsoft To Announce Windows Mobile 7 On Monday

Microsoft Corp. is expected to announce a major overhaul of its mobile phone software on Monday, as the company seeks to recapture market share from rivals.

Analysts predict that Microsoft CEO Steve Ballmer will reveal the new Windows Mobile 7 during the Mobile World Congress in Barcelona, Spain.

The software, which could be available later this year, follows Microsoft's loss of market share to Research in Motion Ltd.'s BlackBerry among business users and Apple Inc.'s iPhone among consumers. 

Microsoft's operating system runs on phones made by Samsung Electronics, Motorola, HTC and others.  The company's previous update, launched last October, was widely seen as lackluster.

But Windows Mobile 7 is expected to be more consumer-centric, offering a simplified user interface similar to Microsoft's Zune HD media player.

"If that thing had a phone in it...that would be a pretty darn good device," Forrester Research analyst Charles Golvin told the Associated Press.

"But my own judgment is that this is kind of their last chance," he added.

"If Windows Mobile doesn't get it right this time around, they're probably toast," he said, adding that Microsoft is well known for keeping to its projects through multiple versions.

However, smartphone advancements are progressing so fast that persistence alone may not be enough. 

Indeed, both RIM and Apple are already capturing market share from Microsoft, and Google Inc. has emerged as a significant threat with its new Android software.

The stakes are high in the competition for smartphone supremacy, since the phones guide users to lucrative Web services and ads.  And software developers will typically create applications for the largest base of phones first - making those phones even more appealing.

Last year, Windows phones accounted for just 8.8 percent of the global smartphone operating system market, down from 13.9 percent in 2008, according to technology analysis firm Canalys.  It lags behind Symbian, the system used on Nokia's smart phones, which has 47.2 percent of the market, RIM's BlackBerry with 20.8 percent and Apple's iPhone with 15.1 percent.

As Microsoft works to regain its position, it also finds itself in the predicament of charging for something that others give away at no charge.  Indeed, both Android and Symbian are free for any manufacturer to use and modify however they chose, something Google and Nokia hope will drive adoption and lure users to their services.

But competing against a free product hasn't hindered Microsoft in the PC market, where free Linux software has failed to make significant inroads against Windows.

However, mobile phones are different, being less dependent on compatibility with other Microsoft products or with peripherals.

Software costs comprise a fairly small part of the overall cost of a mobile phone, and manufacturers are likely to incur these costs given the benefits, said In-Stat analyst Allen Nogee in an interview with the Associated Press.

Ballmer announced Windows Mobile 6.5, the previous software update, in Barcelona a year ago.  But the release, launched in October, received a lukewarm response.

"Microsoft always tries to make a big splash at Mobile World Congress"¦and they never do," Hays said.


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