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Microsoft’s struggles with mobile are no secret. Worldwide smartphone marketshare for its Windows Mobile OS is estimated to be about 2 percent (Admob, May 2010), and MSFT just discontinued the Kin phone, weeks after launch. It would be easy to think of the company as a smartphone also-ran in a world dominated by Apple, RIM and Google.

That may change in 2010. Microsoft has very uncharacteristically scrapped its entire Windows Mobile operating system and is relaunching with Windows Phone 7. Get used to that term, because as we get toward launch in early Q4, you’ll be hearing it everywhere.

What is Windows Phone 7, and why pay attention? After all, Microsoft has entered the mobile fray several times to great fanfare, only to end up on the sidelines. Like it did in the 1990s, when Windows was widely derided as a copy of the Mac OS, Microsoft has taken some key pages out of Apple’s playbook, while taking advantage of its own strengths. This combination could potentially be very powerful.

This week, Microsoft opened up the Windows Phone 7 platform to most of the development community. The initial feedback has been very positive given the backlash Microsoft often gets from developers, especially those who have been steeped in Apple’s iPhone for years.

What Windows Phone 7 has replicated from Apple:

Curated software: Unlike Android, Microsoft will review apps before they are permitted in the store. This is a big deal in terms of ensuring that devices will continue to operate at full potential over time, and that apps have consistent user functionality across them.

Minimum Specs: Windows Phone 7 devices must meet minimum technical standards (e.g., memory, functionality). This significantly eases development issues and timelines vs. Android where a broad array of devices are supported.

Integration to Xbox LIVE platform: This is the big break-through. Apple used the iTunes platform to transform its music base into app buyers; Microsoft is going to use its 20+ million Xbox LIVE/Zune base to do the same. Android and BlackBerry currently have no similar base of users with credit card accounts.

Microsoft isn’t really competing with Apple, at least not at first. It’s competing with Android and other operating systems to get on handsets. Microsoft’s pitch presumably will be that it can help the device makers and carriers get to an orderly “iPhone” world — away from the messy Android universe.

Once it gets on enough handsets, the consumer battle with iOS, BlackBerry and Android will get into full swing. 2011 should be exciting.


Tobias Dengel is CEO of WillowTree Apps Inc., a mobile applications developer. He is also BIA/Kelsey’s new technical editor and will be posting regularly on mobile-related topics. The views he expresses are his own and do not necessarily reflect those of BIA/Kelsey.

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