Windows Phone 7 offers nothing wonderful to consumers

Oct 11, 2010
Finance

Microsoft’s Windows Phone 7 should prove to be about as appealing to consumers as, say, John Deere sports cars. Certain companies would do better to just stay away from certain businesses, and Microsoft (MSFT) keeps proving it has a tin ear for the consumer mobile space. This was spectacularly demonstrated by the stillborn Kin earlier […]

Microsoft’s Windows Phone 7 should prove to be about as appealing to consumers as, say, John Deere sports cars.

Certain companies would do better to just stay away from certain businesses, and Microsoft (MSFT) keeps proving it has a tin ear for the consumer mobile space. This was spectacularly demonstrated by the stillborn Kin earlier this year.

To follow that up, Monday morning Microsoft unveiled the Windows 7 mobile operating system and nine phones that will use it. The phones have a few interesting features, but for the most part elicit a furrowed-brow curiosity about who will buy them.

Really, the best part of the press conference was watching burly, blustery Steve Ballmer call the phones “always delightful” and “wonderfully mine,” as if he were about to break into a Cole Porter number.

Some of the chief sour notes from Microsoft’s unveiling:

  • Windows 7 mobile tries for a very different look and feel than the dominant phones on the market, Apple’s (AAPL) iPhone and Google’s (GOOG) Android-based phones. Windows Phone 7, for instance, navigates through “hubs,” such as the “people hub.” When you try something that different from what people have gotten used to, you either hit a home run because it’s so much better than the old way – a la the initial iPhone – or you just make most people wonder why they should bother changing their habits. More than likely, Win 7 mobile falls into the latter camp.

  • Microsoft’s introductory video for Win 7 mobile puts down iPhone and Android by saying they “focus on apps over the phone experience itself.” Well, actually, the mobile space has shifted in the past year to be all about what phones can do – i.e. apps – instead of the phones themselves. A cool phone experience with a dearth of apps is a dead end for consumers – it’s exactly the challenge Hewlett-Packard now faces as it tries to revive the Palm platform.

  • Along those lines, according to Microsoft, a great feature of the new phones is that they’re integrated with Bing and Zune. That’s good news for the minority market share that uses Bing and the infinitesimal user base of Zune.

  • Perhaps Microsoft’s biggest misstep is that, for now, Windows Phone 7 will only be available on AT&T (T) and T-Mobile networks. Consumers who buy phones that are not iPhones often do so to get away from AT&T. If you’re going to be stuck with AT&T, why not get an iPhone? And — who’s on T-Mobile? The only way Microsoft would have a chance of winning massive numbers of consumers would be by offering a great phone on both Verizon (VZ) and Sprint (S). Neither carrier is expected to offer Microsoft phones until 2011.

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Business customers could find value

All of that said, Windows Phone 7 should have some appeal for enterprise customers. They are integrated with Microsoft Office and Exchange, the two pieces of software that keep most of the world’s businesses running day to day. If Microsoft focused on that part of the smart phone market – basically, the people who still stick with RIM’s (RIMM) Blackberry – it could do some damage. Microsoft is at its strongest as an enterprise software company. Other than Xbox, it doesn’t make anything that consumers truly love.

If Microsoft’s introduction of Windows Phone 7 is any indication, the company isn’t going to make much of a dent in the consumer smart phone space. And then let’s hope Ballmer never again uses phrases like “wonderfully mine.”

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