Microsoft getting serious about consumer mobile market

Microsoft builds custom 'skin' for new T-Mobile USA phone

Microsoft built a custom Windows Mobile user interface for a new phone that T-Mobile USA expects to announce this week, evidence that Microsoft may be getting more serious about pursuing the consumer mobile market.

The phone, built by HTC, will be the first in a line of phones from T-Mobile using the new Shadow brand, said David Sholkovitz, marketing manager at T-Mobile.

While Microsoft has worked with operators to help modify the operating system to fit their needs, this project represented a new level of partnership, said Doug Smith, director of marketing for Microsoft's mobile communications business. "I'd say this was one of the deeper partner involvements we've had on a new product," he said.

The Shadow features a home screen that looks very different than other Windows Mobile phones. Users slide a wheel to navigate through icons on the screen that take them directly to e-mail, their music player and photos. The idea was to make it easier to use increasingly complicated phones, said Sholkovitz.

The operator approached Microsoft about ways to alter the home screen in order to simplify it and prevent "feature fatigue," he said. "We wanted to create a product with the feature set that Windows Mobile products have but deliver it in a simple fashion that was user intuitive and icon based," he said.

T-Mobile, Microsoft and HTC began working on the new user interface in November of last year. "I think this was rare for [Microsoft]," said Farah Houston, product development manager, T-Mobile. "We had access to a lot of resources I don't think they normally make available. Microsoft is trying to show they're serious about the consumer market and this is what they're willing to do."

Windows Mobile, which works in tandem with Exchange to push corporate e-mail to the phones, has a reputation primarily as an enterprise tool. T-Mobile hoped to avoid that image with the Shadow and the keyboard design is meant to help. "When users see a full keyboard they think business and productivity," said Sholkovitz. "So we made it a hidden slide-out keypad."

During a keynote speech at the CTIA I.T. and Entertainment conference in San Francisco last week, Microsoft CEO Steve Ballmer described what Microsoft thinks will attract consumers. "Consumers will want phones that span all of their life personas," he said. "My work life, my personal life, my life with my family, my life with my friends. People don't want to pull out multiple devices."

Another Microsoft executive echoed a similar thought. "We can do multiple things in parallel," said Scott Horn, general manager of Microsoft's mobile group, also speaking at CTIA. "We can do both consumer and enterprise... You will see more devices appeal to the consumer side."

The talk of consumer needs shows how the iPhone is likely affecting Microsoft's strategy, one analyst said. "There's no doubt the success that Apple had with the iPhone in terms of appealing to the mainstream end user market as opposed to the business market has not gone unnoticed," said Michael Gartenberg, an analyst at Jupiter Research. "Microsoft has built these devices to service and solve business needs but Microsoft understands the intersection of business and consumer."

The declining price of Windows Mobile devices will make them more appealing to consumers, said Smith. The Shadow, as an example, will retail for US$150 with a two-year voice and data contract. It will work with a new data plan from T-Mobile that costs US$20 per month and includes unlimited data use and Wi-Fi access at T-Mobile hotspots.

The phone will be displayed in T-Mobile stores along with other lower cost feature phones, not with the higher end smartphones, said Houston.

Neither Microsoft nor T-Mobile would comment on intellectual-property ownership for the new software interface on the Shadow.

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Nancy Gohring

IDG News Service

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