Windows Mobile worries mount as competition heats up

Microsoft's mobile OS future could be dim with the rise of Android, other rivals

When Microsoft CEO Steve Ballmer admitted publicly in September that the company did "screw up with Windows Mobile," many experts were left wondering how the mobile operating system can be fixed with the arrival of version 7 next year -- and beyond.

A more pressing question might be: What will be left for Windows Mobile by the time version 7 arrives mid-year or later with all the smartphone competitors coming to market, especially Android smartphones from various makers and wireless carriers, including Motorola's Cliq and Droid , to be carried by T-Mobile and Verizon, respectively.

In a way, predictions of a possible demise of Windows Mobile are a bit wan to anybody who has followed the business for a decade. The OS once set the bar for other device makers, including Palm Inc. and Nokia, said Kevin Burden, an analyst at ABI Research.

But then came Apple's iPhone in 2007, and steady progress from BlackBerry and the arrival of Android devices in late 2008.

"Heading into 2010, the momentum [for Windows Mobile] has dissipated and there has been wide speculation that Microsoft might be ready to bail out on the mobile operating system market altogether," Burden wrote recently.

In the summer, several Gartner Inc. analysts were also questioning the future for Windows Mobile on consumer-focused devices beyond Windows Mobile 7, noting that it was a poor performer for Microsoft and had fallen in market share.

In one exception, Burden and Gartner analyst Ken Dulaney have joined customers such as FedEx Inc. in predicting Windows Mobile has a long future for a specialized group of users who deploy the ruggedized devices made by companies such as Motorola, Intermec and Pison Teklogix.

It took many years for makers of rugged devices used mainly by warehouse workers and service and delivery drivers to convert their customers from DOS systems to Windows Mobile, so transitioning them to another OS would take years, Burden told Computerworld on Friday. "And even if you did try to transition, what OS would you use?" he asked.

But at the same, Burden said, "I worry about the future for Microsoft within the consumer-focused smartphone base. Windows Mobile will always be there for business users of rugged devices, but it's valid to say that for consumers, Windows Mobile's future is undecided and unclear."

If Windows Mobile 7 has interface improvements and changes to adapt to the user friendliness of iPhone and other devices, those changes might come along too late in the second half of 2010, Burden said. "If that happens then, what's left for Windows Mobile if Android really starts to take off and Symbian gets its act together?"

Microsoft also seems to be holding to an outmoded concept of licensing its OS to manufacturers, while Google's open source Android is ascending, Burden said. "Licensing OS's doesn't fly anymore in mobile," he said, noting that smartphone makers like Apple are seeing value in selling third party applications and taking a share of the sales from them.

Gartner has also asserted that Android will be a major threat to Windows Mobile and just about every other OS in coming years. In a recent forecast, Gartner predicted Android will jump to second place in the global market behind Symbian in 2012, moving up from the sixth spot in 2009.

At the same time Windows Mobile will fade some in market share in 2012, Gartner said.

Android will catapult to second in 2012 on the basis of the large number of manufacturers committed to deploying it, Dulaney said again today, noting that Samsung, LG, HTC, Motorola, Acer, Dell, Sony Ericsson, Garmin and others have all jumped on the Android bandwagon.

To be sure, Android's impact on the market is gauged very differently by Gartner and ABI, with ABI's forecast far more conservative. In 2012 alone, Gartner is predicting Android sales of 94 million units globally, second to Symbian with 197 million and ahead of Windows Mobile in fifth position with 48 million.

In comparison, ABI iorjects that by 2012 Android will be third position behind Symbian, in first, and BlackBerry in second, with Android reaching just 28 million units sold.

The difference in the two analysts' forecasts for Android, however, doesn't diminish the firms' concerns for Windows Mobile.

Burden said there is one strategic move Microsoft could take to bolster Windows Mobile 7, although he admitted it seems unlikely Microsoft will do so. That would involve taking control of Microsoft's ActiveSync, which allows push access to its popular Exchange e-mail and calendar systems and other consumer services. It could be made to only to work with Windows Mobile products, cutting it off from Symbian, BlackBerry, and iPhone, where it is used today.

"[Microsoft] could be really greedy and say ActiveSync is all ours to give Windows Mobile 7 a chance, but it's more likely they will go in the opposite direction," Burden said.

That opposite direction assumes that Microsoft sees value in licensing ActiveSync to many other device makers, meaning their customers will use the software to link to its successful office productivity applications, Burden said.

"It's more likely Microsoft will say ActiveSync is available to everyone, which means that Windows Mobile 7 is going to be behind the eight ball," Burden said.

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Matt Hamblen

Computerworld (US)
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