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Microsoft Should Dump Middlemen, Build Own Phones

CmdrTaco posted more than 3 years ago | from the i'll-do-it-myself dept.

Cellphones 262

suraj.sun writes "Microsoft has a long and illustrious history of operating system sales. The model has served the company well on the PC, but if it wants to make money in the phone market, it needs to start thinking like a consumer electronics company and start making its own phones."

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262 comments

Incoming incessant sopssa/SquarePixel trolling ... (-1, Troll)

Anonymous Coward | more than 3 years ago | (#33055070)

sopssa = SquarePixel = fucktard troll. Remember it moderators!

Peace out!

Re:Incoming incessant sopssa/SquarePixel trolling (-1, Offtopic)

Anonymous Coward | more than 3 years ago | (#33055244)

Oh yeah what the fuck wht the fuck !!!!!!!

That could work like the xbox (2, Interesting)

Winckle (870180) | more than 3 years ago | (#33055072)

Given that the xbox has done rather well for them, but they'd be entering a market where cool is king. They would have to come up with some seriously strong designs.

Re:That could work like the xbox (3, Insightful)

vwjeff (709903) | more than 3 years ago | (#33055100)

I want to see a red ring of death on a phone.

Re:That could work like the xbox (1)

isfry (101853) | more than 3 years ago | (#33055380)

I want to see a red ring of death on a phone.

you mean Red Ringtone of Death...

Re:That could work like the xbox (0)

Anonymous Coward | more than 3 years ago | (#33055760)

You would see a red ring that would spell death for that phone. just not on the phone itself. You'd see it every time you looked in the mirror. The phone would run so hot it would leave a circular burn mark on your ear every time you used it.

Re:That could work like the xbox (1)

Slashidiot (1179447) | more than 3 years ago | (#33055118)

Because in the gaming market cool has no weight whatsoever...

Re:That could work like the xbox (1)

91degrees (207121) | more than 3 years ago | (#33055194)

It has weight, but the XBox isn't cool. The Wii is. XBox does well because it has some cool games and some good-but-not-cool features.

Re:That could work like the xbox (2, Interesting)

Pojut (1027544) | more than 3 years ago | (#33055232)

Windows Media Extender + 2 TBs of DVD backups and TV shows + one less box hooked up to my TV = cool.

Re:That could work like the xbox (1)

91degrees (207121) | more than 3 years ago | (#33055270)

It's cool if you're a geek. I like it. Watching TV is not mainstream cool though, and a vast collection of anything is typially considered a bit nerdy.

Re:That could work like the xbox (1)

mdwh2 (535323) | more than 3 years ago | (#33055370)

But this is the problem - what is meant by "cool"?

One could say the same of the mobile market - evidently things like fashion and "cool" are important, but it's unclear that who has it. For geeks round here, it's Apple (and to a lesser extent, Android) that seems "cool". But look at the mainstream, and it's RIM (in the US) and Nokia (worldwide), not to mention companies like LG, Samsung, Motorola. It's also not clear that Microsoft are incapable of doing something that the mainstream see as "cool" - again, it seems to be predominantly among geeks, rather than the mainstream, that mock Microsoft as not being "cool".

Re:That could work like the xbox (2, Insightful)

Zantac69 (1331461) | more than 3 years ago | (#33055202)

I think someone said this already - but cool is king on phones but its a different cool. Functionality, sleek lines, good displays, powerful hardware - who has the sexy phones now? Who would they have to emulate?

HTC?
Motorola?
Nokia?
Samsung?

is that it? Would M$ think about an aquisition for this? The only one that might be grabbable (in m opinion) is HTC. Just tossing that out there...I hope they dont...but it could be an interesting move buisnesswise - especially if they let HTC maintain other activities with Android in parallel.

Re:That could work like the xbox (1)

Bertie (87778) | more than 3 years ago | (#33055208)

Oh yeah, having to replace half of them because they overheated themselves to death has just done wonders for their bottom line.

Re:That could work like the xbox (4, Funny)

GrumblyStuff (870046) | more than 3 years ago | (#33055280)

So they'll sink $4-5 billion building hardware, software, branding, and (presumably) a market/network? Yeah, maybe.

Or it could be a Zune phone, replete of velvety brownness and the ability squirt.

Actually, it would be fun to see them flop about in a costly and humiliating manner. Sure the Xbox has turned a profit for some select quarters but I reckon they're still down a few billion overall. Does anyone know how the Zune is fairing?

I, for one, welcome Windows Live 7 Professional Phone Xtreme Crispy Chunky Ranch-Bacon. If it worked for Vista [penny-arcade.com] and Hotmail [msdn.com], well, they could work similar magic with a homegrown phone.

(We can still make fun of Vista and Hotmail, right? And what the fuck is with those Hotmail ads? They make less sense than the Seinfeld ones.)

Re:That could work like the xbox (4, Insightful)

samkass (174571) | more than 3 years ago | (#33055476)

Given that the xbox has done rather well for them

Only losing a couple million dollars is "rather well"? The XBox sells well because it's subsidized by the Office and Windows monopolies, but it's not exactly a profit center [businessinsider.com].

Re:That could work like the xbox (0)

Anonymous Coward | more than 3 years ago | (#33055558)

Yea, that's not really true. That graph does not have an XBox division, the XBox is lumped in with "Entertainment and Devices" which would include the disaster that was Zune, and the money they sunk into things like Surface and Zen, neither of which generated any revenue. Not to mention the money they sunk into R&D for Windows Mobile 7 which has yet to come to market. Not to mention the fact that despite all of this, the "Entertainment and Devices" division did turn a profit in Fall of 09 according to that graph. Microsoft is turning a profit from the XBox, just (obviously) not as big of one as they turn from Windows and Office.

And by the way, the sentence "The XBox sells well because it's subsidized by the Office and Windows monopolies" makes no fucking sense. A subsidy can help something turn a profit, it can't help something sell.

In other news (3, Funny)

Dunbal (464142) | more than 3 years ago | (#33055090)

Microsoft's search for a viable business model continues.

Re:In other news (2, Insightful)

bidmead (1032322) | more than 3 years ago | (#33055170)

> Microsoft has a long and illustrious history of operating system sales. Illustrious? Oh, I see.... It's the sales that are illustrious. -- Chris

Re:In other news (1)

maxume (22995) | more than 3 years ago | (#33055320)

Selling Windows and Office is working fine. They are looking for viable ways to grow faster.

Re:In other news (3, Interesting)

Xest (935314) | more than 3 years ago | (#33055562)

Personally, if I had a choice, I'd gladly take Microsoft's non-viable business model at $18bn profit in the last year more than I'd take any other technology company's as that's over double Apple's profits and nearly triple Google's profits.

Microsoft's got a perfectly viable business model, such that it's still consistently slaughtering the competition in the technology market in terms of profit they make year on year- I think IBM is the next closest at around $12bn and HP 3rd at about $9bn, although I could be wrong, I've not been paying attention to all of them.

The issue is simply that Microsoft is struggling to grow their market even more, not that they don't in fact make fuck loads of profit, and have a metric shit ton of assets and equity. The fact is it can do things like the Kin, the Zune, the XBox, and whether they flop or not is irrelevant when they're still pulling in more profit than any other technology company out there from the profits of their core business. If however one of their adventures does turn out to be a hit then great, they've widened the gap even more, if not, then, well, their lead in terms of profit is still pretty massive and even Apple and Google's resounding successes in comparison over the last decade haven't even come close to closing the gap. Unless Microsoft has a secret oil drilling operation that's going to explode due to poor maintenance in the gulf of Mexico soon then there's not too much that'll change that in the forseeable future. As a company, financially, they're still a behemoth, and are as solid as a rock.

Re:In other news (3, Insightful)

NatasRevol (731260) | more than 3 years ago | (#33055738)

Microsoft is a software company, therefore they have 90% profit on sales.
Apple is a hardware company, therefore they have 40% profit on sales.

That's why, in spite of their revenues being about the same, MSFT makes more profit.

However, AAPL's revenue is going up at a MUCH greater rate that MSFT. AAPL will pass MSFT in revenue this next quarter, and probably pass them in profits in the next year.

Where do you want to be?

Re:In other news (0)

Anonymous Coward | more than 3 years ago | (#33055624)

I hate Microsoft as much as the next guy, but milking their OS and office suite monopolies brings them dump-trucks full of cash every day.

Good thing too, a lesser company would have gone bust with that huge procession of turkeys and white elephants.

Re:In other news (1)

kyuubi42 (1424889) | more than 3 years ago | (#33055638)

Microsoft turned $17.6 Billion in profit in 2009, they are 35th on the fortune 500. I think they know how to make a buck.

Re:In other news (1)

bravecanadian (638315) | more than 3 years ago | (#33055712)

This just goes to show you how out of touch slashdotters are with what an actual business model is...

Microsoft is *very* successful.

Like triple Google successful.

"Microsoft should..." (0, Troll)

Anonymous Coward | more than 3 years ago | (#33055092)

This is a dumb opinion piece from no one important. I don't see why it's here. :/

Great... (1, Funny)

betterunixthanunix (980855) | more than 3 years ago | (#33055130)

Just what we need -- a Microsoft apps store.

Re:Great... (1)

voidptr (609) | more than 3 years ago | (#33055250)

That's already coming in Windows Phone 7, whether they build the hardware or not.

Re:Great... (2, Funny)

HopefulIntern (1759406) | more than 3 years ago | (#33055420)

Does anyone else think "Windows Phone 7" sounds really clunky and weird?

Why not "Windows7 Phone", or "Mobile7" or something? "Windows Phone 7" just seems like a tonguetwister, or a haiku at best:

Windows Phone 7
Why do I even bother?
I am not impressed.

Much like Hyper-V... (1, Informative)

gimmebeer (1648629) | more than 3 years ago | (#33055142)

...they're too far behind to be viable in this market. Just give it up and stick with servers MS.

Ehr, no. (3, Interesting)

miffo.swe (547642) | more than 3 years ago | (#33055148)

Microsoft do not have engineering talent nor software talents to pull something like that off, especially not in management. No matter how good of a phone the grunts make, management will kill its potential. It has happened countless of times before and it will happen again.

Xbox is not a success and while now making modest profits it has lots and lots of investments to recoup before giving any payment on the money spent. Its an utter failure up until today and if nothing ground breaking happens it will keep on being a third rate console.

The only way Microsoft could succeed is to break out a mobile team and totally isolate it from any managment and Microsoft itself. Even when they buy an excellent and complete product like Danger they still manages to wipe it off the planet my mismanagement.

Im also not so sure being a top down shop like Apple is good in the long run. Those kinds of companies tend to stiffen up and become stale and slow pretty fast when given enough market share.

Re:Ehr, no. (1)

betterunixthanunix (980855) | more than 3 years ago | (#33055224)

Microsoft do not have engineering talent nor software talents to pull something like that off

Where the hell did you get that from? Microsoft has plenty of programming talent, and they pay quite a lot for it. The problems are primarily in management (see: Vista).

Re:Ehr, no. (1)

the_womble (580291) | more than 3 years ago | (#33055410)

Programming talent, yes, but phones require hardware engineering and design talent as well. Do they have that? They have a hardware business, but they do not, AFAIK, make any mobile devices.

The rest of the GP's points seem entirely reasonable.

Re:Ehr, no. (2, Interesting)

gimmebeer (1648629) | more than 3 years ago | (#33055498)

That's not to say they don't have programming talent, that's a given. What I'm getting at is that MS tends to enter markets that already have cut and dried leaders, and their attempts to catch up from years behind the curve give their products a distinct feeling of inferiority. They may catch up to Android and Apple, but it'll take a while for the stigma of a "windows phone" to go away.

Re:Ehr, no. (1)

mdwh2 (535323) | more than 3 years ago | (#33055690)

What I'm getting at is that MS tends to enter markets that already have cut and dried leaders, and their attempts to catch up from years behind the curve give their products a distinct feeling of inferiority. They may catch up to Android and Apple

But the cut and dried leaders in phones are the likes of Nokia, RIM, along with many other companies like Samsung, LG, Motorola - and it's Google and Apple that entered as the new guys, and are playing catch-up (in Apple's case, "from years behind the curve" - 3G, Java, Flash, video recording, MMS, copy/paste, multitasking, etc). If they can do it, I don't see why this is an impossible problem for Microsoft.

I've yet to see evidence that Windows has a "stigma" outside of the geek world.

Great Idea! (1, Insightful)

Anonymous Coward | more than 3 years ago | (#33055154)

Worked for Goo... wait, what? Oh, nevermind.

Re:Great Idea! (1)

AndrewNeo (979708) | more than 3 years ago | (#33055482)

When did Google build their own phone? Because if you're referring to the Nexus One, HTC made it.

Hasn't Microsoft just done this with the Kin... (5, Insightful)

Fraggy_the_undead (758495) | more than 3 years ago | (#33055162)

... and failed spectacularly?
And seeing how the "make the OS, leave making the phone (mostly) to others" business model seems to be working rather well for Google, I don't see, why it shouldn't for Microsoft.

Re:Hasn't Microsoft just done this with the Kin... (1)

ArtDent (83554) | more than 3 years ago | (#33055188)

How about *because* it's working so well for Google?

I presume Microsoft would like to charge something for their operating system?

Re:Hasn't Microsoft just done this with the Kin... (0)

Anonymous Coward | more than 3 years ago | (#33055442)

The Kin was a purchased company called Danger, Inc which was actually co-founded by Andy Rubin who is over Android Development.

Re:Hasn't Microsoft just done this with the Kin... (5, Informative)

msauve (701917) | more than 3 years ago | (#33055458)

Yes, but they should still do it because Peter Bright, the author of the article, is a multi-multi-billionaire who made his money in consumer electronics. Wait, that not right, his bio tells us:

Peter Bright dropped out of university after about five minutes to work as a programmer. He now lives in London, where he enjoys trolling, reading 4chan, gorging on burritos, and musing about the future of Microsoft.

So, never mind. He's just another Internet person with an opinion which isn't backed up by either knowledge or experience.

Re:Hasn't Microsoft just done this with the Kin... (1)

DrgnDancer (137700) | more than 3 years ago | (#33055728)

Well as the article points out, it's already working for Google. Has been for a couple years now. Android is free (gratis) which I doubt the MS OS will be so that saves money to the OEM, It's customizable which the MS OS won't be, and it entrenched which the MS OS can't be. I think the author has a point here.

Right now the consumer smartphone market is essentially divided between Android and iPhone in the US (Note, the *consumer* and the *US* before you flame please). iPhone is the vertically integrated, what you see is what you get, we control the horizontal and the vertical, smartphone (Again, before the flames, I use a 3GS. I like it. Noting wrong with vertical integration as long as you know what you're getting). Android is the open, varied, commodity smartphone. It appears on handsets more advance than the best iPhone and on pieces of crap that can barely make phone calls. Microsoft appears to be trying to leverage an "in between" model that they hope will have all the advantages of both models.

The problem is that they're leaning towards Apple's model in every important way except how they plan to make money. Microsoft makes a ton of money off of Windows/Office because they sell millions and millions of copies. It seems unlikely (at this point) that they'll sell millions and million of phone licenses. It's a growth industry, sure. In twenty years smartphones might be like computers where nearly everyone has one and making 20 bucks a head on each sales is hugely profitable. Not now though, and Microsoft is no longer a lean little company that can afford to ride a 20 year wave waiting for the payoff.

Fatal exception error! (2, Funny)

Anonymous Coward | more than 3 years ago | (#33055166)

Your call cannot be completed. The number you have dialed is not on a Microsoft-supported phone! Press 1 to report the issue to Microsoft. Press 2 for technical information about this error. Press 3 to hear these options again. Or press 0 now to speak to a Microsoft technical support representative!

The phones will all have to be blue (0)

Anonymous Coward | more than 3 years ago | (#33055242)

So that they match the screens.

Trying to be Apple (0)

Anonymous Coward | more than 3 years ago | (#33055172)

They are trying to exert the same control over the user experience that Apple does, but without making the hardware themselves. This might have worked five years ago - maybe even two years ago - but why would the hardware vendors (not to mention carriers) sign on for a new platform over which they have no control? Android is out there, which gives them the freedom to customize the phones to their hearts' content. For those that prefer the vertically integrated experience, there's Apple. Going to be tough to carve out a market niche, unless there is a compelling feature. I will be surprised if the "Windows" name is enough.

Re:Trying to be Apple (0)

Hal_Porter (817932) | more than 3 years ago | (#33055392)

I think there's an argument that they should have an "Apple like" product which they do in house and a "Windows Mobile" like OS they license to third parties.

Right now they're trying to replace Windows Mobile 6.5 - which runs Pleco [pleco.com] very well with Windows Phone 7 which probably won't ever [plecoforums.com].

It would make more sense to have Windows Phone 7 as their internal Apple like (i.e. locked down but slick) product and keep Windows Mobile going for people that have software for it they want to keep using.

If they really do replace the WinMo6.5 with WinPhone 7 there's a serious chance that it will be rejected by the sort of people who buy iPhones (why not stick just buy an iPhone?) and the sort of people who'd have bought a Windows Mobile Device. Why buy a phone which won't run your old software. In fact if you look at the Pleco site the software will work on an iPhone. The developers are fairly irritated by the whole thing

http://www.plecoforums.com/viewtopic.php?p=18657#p18657 [plecoforums.com]

I'm done paying for mobile platform/carrier specific apps. If my need is critical enough to spend real money on (like the $100 for Pleco) I'll buy the best app I can find for Windows 7 desktop and just run it on one of the W7 tablet/hand-held devices coming out in the future giving me long-term investment protection. What I won't do again is invest in an application where there's a likelihood support for my platform will be dropped because of the ever-changing state of the mobile phone market, especially when it forces me to choose both a new hardware vendor and potentially lock into an undesirable wireless carrier. At least on Windows I know my app will work essentially forever.

I certainly understand your frustration - it's 10x worse on this end, I'd much much rather have spent the last year-and-a-half working on adding features on WM than rewriting the same darn program again for a different platform (or possibly two). Investing $100 in an application that might drop support for your platform is bad, investing several orders of magnitude more money than that in developing an application for a platform whose manufacturer drops support for it is even worse. (as happened on both Palm and WM about a year apart, though at least Palm had the decency to make some attempt at backwards-compatibility - Microsoft just plain screwed us, which is why I found myself feeling a bit of schadenfreude when the Kin turned into the latest iteration of Microsoft Bob)

We try to make it a bit easier on our customers by allowing free platform transfers whenever we can (though it does complicate matters somewhat on the business end) but we're very much hoping that the market will finally stabilize soon so that we can stop having to chase the latest mobile platforms and just focus all of our energies on making our software better.

I.e. they wrote an app for PalmOS, which was dropped. Then they wrote an app for Windows Mobile which is in the process of being dropped for Windows Phone 7 which will not support native Windows CE applications, only .Net ones.

I really have no idea what Microsoft are thinking by disabling support for Windows Mobile apps in Windows Phone. It's like if they'd launched Vista with no support for Win32 applications when most of those applications already run on Macs and Macs had a much larger market share.

kin (0)

Anonymous Coward | more than 3 years ago | (#33055178)

They already did, it was called the Kin and it failed miserably (i love that absolutely commonplace expression "failed miserably"... as if there was any other sort of failure that would not make one miserable?)

Oh yes ... (1, Troll)

psergiu (67614) | more than 3 years ago | (#33055184)

Oh yes, of course, Microsoft should TOTALLY build their own factories and then build their own hardware. All the Linux, BSD & Mac users agree that Microsoft should definitely invest all of their cash in some big money holes until they go bankrupt. :-)

Re:Oh yes ... (1)

Ruud Althuizen (835426) | more than 3 years ago | (#33055292)

In that case I'll support their cause :-). I wonder if they are going to put some DRM on it or cripple it in some Microsoft only way (ACPI anyone?).

Re:Oh yes ... (1)

Mongoose Disciple (722373) | more than 3 years ago | (#33055694)

But then where would they, uh, borrow ideas from? :)

(Yes, a lot of 'borrowing' goes both ways, and probably makes both better than they would be in a vacuum.)

Eh... (2, Insightful)

Pojut (1027544) | more than 3 years ago | (#33055190)

I think Microsoft should just leave the phone market all together, insofar as entire operating systems are concerned. Windows Phone 7 looks cool, but the lack of multitasking and the walled garden approach make it a moot point. Let's face it...if you are going to deal with a walled garden, you're most likely going to go with Apple.

Xbox Live connectivity is intriguing, but not only do I not care about constant contact with my Live friends list...I don't want it. The mobile gaming is also a slight draw, but that's why I have a PSP/DS...

At this point, Microsoft should just concede this market. They will never catch up to RIM/Android/Apple, and all it will do is hurt their image when it fails.

Re:Eh... (2, Insightful)

betterunixthanunix (980855) | more than 3 years ago | (#33055324)

Let's face it...if you are going to deal with a walled garden, you're most likely going to go with Apple.

Where did you get that one from? Many cell phones have no options for installing third party software at all; the imprisoned garden would be perceived as an improvement for users of those phones. Microsoft may be coming a bit late to that party, but I do not think the party is over just yet.

Re:Eh... (1)

Pojut (1027544) | more than 3 years ago | (#33055412)

Where did you get that one from? Many cell phones have no options for installing third party software at all; the imprisoned garden would be perceived as an improvement for users of those phones. Microsoft may be coming a bit late to that party, but I do not think the party is over just yet.

Apple's Walled Garden already has a massive number of applications, on top of a mostly positive perception of the iPhone amongst the general public. Microsoft releasing a phone that, to the public, functions similar to the way Apple's runs will most likely be seen as copying Apple. Also, even though its death is imminent, don't forget about the Palm store, either.

Those who know better won't deal with a walled garden anyway, and will stick with RIM or Android.

Re:Eh... (2, Informative)

mdwh2 (535323) | more than 3 years ago | (#33055500)

This is a good point - the whole so-called "feature phones" (which are still "smart" in the traditional sense, in that they run apps, allow Internet access, but don't get counted as such) seems to be completely forgotten among geeks, but they sell far more than the higher end phones. (It's an anomaly why the walled garden Iphone got counted in the smart phone category instead of feature phone in the first place.)

It's sad to see more platforms going for a locked down single-tasking model. But it's funny to see people criticising Microsoft whilst excusing Apple; and it's also clear that in the market for locked down phones, there's room for many companies (including those selling a lot more than Apple).

Re:Eh... (0)

Hal_Porter (817932) | more than 3 years ago | (#33055460)

A lot of people, including me, have applications that run on Windows Mobile. WinMo isn't going the iPhone but there's definitely an argument for keeping Windows Mobile alive for us. In fact Windows CE is pretty widely used for things like GPS devices. They should keep those customers and in parallel decide on whether launching an iPhone like product is worthwhile.

Yeah (4, Insightful)

Bertie (87778) | more than 3 years ago | (#33055200)

Just look how well designing the XBox 360 without the requisite expertise worked out for them...

Re:Yeah (0)

Anonymous Coward | more than 3 years ago | (#33055540)

look at the zune

Utter crap (2, Interesting)

DavidpFitz (136265) | more than 3 years ago | (#33055210)

Nonsense. They're hardly going to build a manufacturing plant. They could (like Apple do) sub-contract to another manufacturer. But, in essence they've already done this with HTC making the bulk of Windows Mobile devices. I guess they could (like Google did) get HTC to build a Microsoft branded phone, but it wouldn't make a whole lot of difference as to what they have today.

Re:Utter crap (1)

Fraggy_the_undead (758495) | more than 3 years ago | (#33055266)

They already do sub-contract manufacturers for their hardware. The XBox360 is - like Apples products - manufactured by Foxconn (at least according to wikipedia [wikipedia.org]), so that wouldn't be a huge leap.

Re:Utter crap (1)

Hal_Porter (817932) | more than 3 years ago | (#33055736)

It's not quite the same thing. HTC is not an ODM, it's an OEM. It has its own software and brand name. When I talked to someone on the Microsoft stand at Computex he told me that HTC was irritated about Windows Phone 7. Since WinPhone can't run native applications HTC would have to rewrite their software (e.g. TouchFlo) in .Net to run on it. What they really wanted was a new version of Windows Mobile with the latest Windows CE kernel. Windows mobile 6.x uses Windows CE 5.x which has a 32MB per process limit because it uses FCSE [arm.com] on ARM. Windows CE 6.x has a 2GB per process address space [microsoft.com].

So HTC want later versions of Windows Mobile. If Microsoft want to build Windows 7 Phone devices they'd be better off getting someone like Foxconn, Quanta or Compal to do it. They are ODMs and basically do whatever the customer wants. The end product would then be branded Microsoft (or Kin, Yo!, Hipstaah or something). Foxconn for example make the iPhone.

Now my argument is that they could do both. They'd sell Windows Mobile 7 based on WinCE6 with native app support to HTC who'd sell devices to me. And they'd get an ODM to make the Windows Phone 7 devices which they'd then sell effectively to operators the way Apple does with the iPhone. These devices would be slick and locked down and would have a low upfront cost like the iPhone does, though you need to sign up for an expensive monthly contract some of which would go back to Microsoft. This is how iPhones work.

I think the two markets are actually complementary. People that want an iPhone don't want Windows Mobile. And people that want Windows Mobile don't want an iPhone. And they certainly don't want a Microsoft knock off of an iPhone whch won't run their old apps.

Advantages to both methods (2, Interesting)

bravecanadian (638315) | more than 3 years ago | (#33055230)

I somewhat agree and somewhat disagree.

Microsoft generally makes pretty good hardware and doing the whole package would give them a tight control over the integration.

The downside is you lose the ability to sell the OS to a bigger portion of the market at the outset.

I think as long as they control the hardware requirements and perhaps have an approval process so that they can do some QA on the phones made by 3rd parties that would be a happy medium for them.

Dump Roz Ho instead (0)

Anonymous Coward | more than 3 years ago | (#33055268)

Why are they looking everywhere but where the problem is? Roz Ho is the reason why "Kin" is a failure. Roz Ho is the reason why Android exists (her screwing up of the Danger takeover). Roz Ho is the weakest link. And yet, she's still there, apparently un-firable.

Make their own phones? Why? I had an old trusty Palm Treo running Windows Mobile. It was actually pretty decent. Google has a great partnership with HTC.

Microsoft's failure at phones is completely the fault of MANAGEMENT.

They did (1, Funny)

Anonymous Coward | more than 3 years ago | (#33055282)

It was called the "Kin". It sold for what, 3 weeks?

Not necessary to sell your own hardware (1, Interesting)

cheesybagel (670288) | more than 3 years ago | (#33055284)

Selling your own hardware is not necessary in this segment. The issue with Windows Mobile has never really been the hardware. The HTC HD2 has great hardware, it is the software that sucks. Microsoft needs to fix the software. The problem with Windows Mobile is the typical Microsoft issue. They make a first software version lavishing many resources to enter a market, then when it gets successful they dump the developers overboard (happened to Internet Explorer as well). The Windows Mobile software platform has stagnated for way too long.

Making Windows Mobile a .NET platform is essential, because it is an easy platform to develop for. Many people know how to develop for it, and those who don't learn quickly. C# is an easier to use language than Objective-C. Making the applications run in a sandbox means you are less open to security vulnerabilities and can afford not to waste as much resources reviewing third party apps before adding them to the online store.

Lastly the Windows Mobile UI is pathetically backwards. It was good back in the day, but now it is too clunky.

Short term memory loss? (2, Interesting)

UnknowingFool (672806) | more than 3 years ago | (#33055296)

MS already built a phone. Actually two of them. They were the Kin One and Kin Two and they have failed miserably.

Because a significant number of consumers... (1)

beamdriver (554241) | more than 3 years ago | (#33055298)

...have been clamoring for a Zune Phone. AmIRight?

Re:Because a significant number of consumers... (1)

mdwh2 (535323) | more than 3 years ago | (#33055734)

The Zune is what people love to make fun of - though to put things into persepective, the market share varied over the years, up to 10%, dropping to a few per cent, which makes it a "flop" apparently; yet I'm not sure that Apple have passed 5% market share in the phone market, and this is seen as a runaway success.

(Not to mention that even if the Zune was a flop, who cares. Lots of companies have their misses, including Apple.)

Microsoft created the operating system market (0)

Anonymous Coward | more than 3 years ago | (#33055304)

"Microsoft revolutionized the operating system market back in the early 1980s. Indeed, Microsoft created the operating system market [arstechnica.com] back in the early 1980s. Back then, when you bought a computer, it normally had its own special operating system that the vendor bundled (or even sold at extra cost)"

I thought IBM hired on Microsoft to write the OS for the proprietary IBM PC? And didn't a company called Apple bring out the Apple 1I in 1977 some time before the IBM PC in 1981?

Marketing droids (1)

owlnation (858981) | more than 3 years ago | (#33055316)

Yes... but I'm not buying one, unless it comes in brown.

Seriously, MS's biggest Achilles Heel is it's whole Marketing / Design Dept. If they had better people there, they'd be a lot more successful, regardless of hardware or software.

Why? (1)

RMH101 (636144) | more than 3 years ago | (#33055344)

Why not come out with an attempt at a kick-ass OS (Windows Phone 7 Series - no idea if it'll be good or not when released but presumably the idea is that it doesn't suck), a tightly-proscribed hardware reference definition for the manufacturers (chipset, number of physical buttons, minimum resolution etc) and then leave all the awkware engineering and production to companies that do it best such as HTC or Foxconn? They don't need to actually manufacture them themselves.

Microsoft Mobile (1)

helix2301 (1105613) | more than 3 years ago | (#33055362)

I agree with this Microsoft needs to really rethink there mobile market strategies and ideas. They have the market in the OS but they have yet to make a dent in the mobile industry this is surprising for a company that has the resources and the finances to do lots of RND.

"Microsoft has a long and illustrious history ... (3, Insightful)

QuietLagoon (813062) | more than 3 years ago | (#33055374)

Microsoft has a long and illustrious history of operating system sales.

.
Here, let me fix that typo for you.

"Microsoft has a long and iniquitous history of operating system sales."

Stupid (2, Insightful)

diegocg (1680514) | more than 3 years ago | (#33055402)

If Microsoft made its own phone all the other phone manufacturers would quit using windows mobile. Yeah, that's a great idea, convert your partners into enemies.

Just because Apple looks "cool" doesn't means that Microsof has to imitate them. In fact Android seems to be able to kill iPhone relevance in the next years. Yet Android is not the product of a company that does software + hardware.

microsoft needs to stop being marketing driven (1)

Dan667 (564390) | more than 3 years ago | (#33055418)

the real problem is microsoft is a marketing driven company that is trying to squeeze a nickel out of and make everyone else happy except the person actually using the phone. If they would just concentrate on the end Customer and quit trying to make the all these other groups happy that have no other agenda, but to degrade the phone (with drm, etc) they would be more successful.

Microsoft should die. (0)

Anonymous Coward | more than 3 years ago | (#33055474)

Problem solved.

MS should spin off their phone division (1)

Eponymous Coward (6097) | more than 3 years ago | (#33055480)

I've heard that their upcoming phone OS is very good. Unfortunately, it's saddled with "Microsoft" and "Windows". If I were Microsoft and wanted to give this division the best chance to succeed, I would spin off the mobile OS division into it's own company and be the majority (only?) shareholder. Part of the spin off agreement would be that Microsoft has perpetual rights to build products around the mobile OS.

Microsoft should then concentrate on enterprisey products (ie, take on RIM) and cede consumer oriented devices to the new company.

This would let Microsoft succeed where they have their best chance and would give the phone OS a better chance of attracting talented developers. Face it, if you are under 30, Microsoft is about as cool as Oracle. And like it or not, cool matters with something like a phone which is an accessory as much as it is a device.

This would only work iff the new phone OS is better in many respects than iOS and Android. Is it? If it isn't, it's going to be WinCE part deux.

To one's self be true (1)

dazedNconfuzed (154242) | more than 3 years ago | (#33055484)

The model has served the company well on the PC, but if it wants to make money in the phone market, it needs to start thinking like a consumer electronics company.

Companies that stick to their core competencies thrive.
Companies that lose track of their core competencies decline and fail.

Microsoft is, first and foremost, an operating systems company. Whatever they do must serve that core competency. To stray from that into another market, say into the cellphone market as a direct competitor, is to pursue an afterthought against those devoted to that market - the fail should be apparent from the outset.

TFA demonstrates as a positive the Zune, showing the author is confused about what constitutes "success".
TFA demonstrates as a positive the Xbox, which is a closed system little different from their main offering of an OS running apps on a PC.
Cell phones are different. They're not PCs. Microsoft should consider it's own history, and that of others: deviating from devotion to the core competency is a fast, and expensive, track to fail.

car companies don't pave roads (1)

Adkins1984 (1845316) | more than 3 years ago | (#33055526)

The cell phone market is essentially closed to anyone that is trying to break in in a huge way. Without something big, and I mean BIG, to offer Microsoft is just better off to rest on it's laurels and stick to what it does at the moment. I refrain from saying what it does best, cause I think it could do better with some effort, but I digress. You know what I mean. Just cause a company makes good cars, doesn't mean it should build roads.

Yes. Just like with music players. (0, Troll)

halber_mensch (851834) | more than 3 years ago | (#33055528)

I'd love to see this. When they decided to get into the music player market they made a brown turd, thought of how to make the word "Tune" edgier and came up with "Zune". Maybe they can shoot themselves in the foot all over again in the phone market with another brown turd with the same awesome marketing skill. "What do we do on a phone?" "I think we talk!" "Ok, let's change the first letter and make it sound hip and edgy!" "Yeah, let's call it the Zalk!" "Oh man, I'd want to buy a Zalk!" "Oh me too!" "Watch out iPhone! The Zalk is the next new hip thing!"

It seems like you would like to make a phone call (0)

Anonymous Coward | more than 3 years ago | (#33055542)

while updates to Microsoft Phone Direct(tm) are being installed. Would you like to make a phone call after Microsoft Phone Direct(tm) has been updated?

Business model (0)

Anonymous Coward | more than 3 years ago | (#33055598)

MS has to understand why it is doing well in GAMING systems, but at the same time MS has to stop "gaming" the features and functions it puts into products and start focusing on users; their new ads claim they are listening to what consumers want, but extra features come with an extra price... MS treats features and functions the same way car dealers treat options like stereos, paint schemes, leather seats.

The are more interested in locking in customers, and milking them for $$ than making them happy...

Until they decide they want to make customers happy, they really shouldn't be selling products to end users; the one place they are doing that are GAMING systems; customers in that market demand the right set of features and functions and MS does it, makes them happy and they are making money.

I completely disagree with this (1)

pastafazou (648001) | more than 3 years ago | (#33055688)

Microsoft's strength is in the fact that it delivers a software product that hopefully works on almost any manufacturer's hardware. The competition for the actual hardware is fierce, and therefore margins are thin. But Microsoft doesn't care whether Samsung, Nokia, LG, or whoever has the hottest line of phones, because they should be selling on all of those devices.

Is Copying Apple a Good Idea? (1)

qazwart (261667) | more than 3 years ago | (#33055746)

The main argument the article makes is look how well it works for Apple. But, Apple has spent years perfecting its products and building its reputation. You can also look at the Android model and see different hardware manufacturers building a phone that competes effectively against the iPhone monolith.

When Android 3 comes out, the various UIs on top of the Android phone and the various lower levels of hardware interface will go away. What was suppose to be an Android strength -- the OS being customizable to various platforms -- has a big weakness. The problem with Android 1.x and 2.x is that it is almost impossible to keep the OS up to date. Many phones are still sold with the old Android 1.6 OS and maybe with no hopes for updating. With the fast accelerating market (the original "Droid" is less than a year old and is now an obsolete phone) the vast differences in hardware is causing problems.

There are also weaknesses with the iPhone model. If the iPhone is available to all cell phone providers, they find themselves as a commodity business competing only on price. Android allowed Verizon to offer distinct phones that its rivals cannot offer. Android 3.0 will take away some of this flexibility as the hardware platform is more standardized, but it isn't as unified as the PC platform. There are too many marketing forces that want to keep the various phones distinct from each other.

W7P is following the Android 3.0 model. The phones can be base upon three different reference platforms, and the platform specifications are loose enough to allow for a wider variety of phones and functionality than found in the PC market. This can be an advantage as cell phone service providers and cell phone manufacturers try to make the devices they offer different from their competitors.

The main threat against W7P isn't external, but the internal forces at Microsoft. There is pressure to rewrite the Zune based W7P platform to use Windows internally. The W7P group already has been told that it cannot offer its OS on tablets (why this group is Windows 7 PHONE and not Windows 7 MOBILE). The Windows CE team is still around and has successfully killed the Project Pink group and is now aiming at the Zune and W7P group. The desktop Windows group is also taking aim at the Zune and W7P group. If Windows 7 Phone fails, it'll won't be because it wasn't a viable platform. Most reviews of W7P have been very good.

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