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Microsoft's Last Chance: Windows Phone 7 and the Road to Recovery

Strategic Insights

— 2 min read

Microsoft is making one final push to resurrect itself in the smartphone market with the launch of its Windows Phone 7 software, marking a crucial moment in the company's struggle to catch up with Apple and Google's Android offerings. The new software, unveiled on October 11, is expected to hit stores by November, but analysts say it's Microsoft's last chance to regain its footing in a market it squandered just a few years ago. The company's attempt to revive its phone business is further complicated by the emergence of tablet devices like Apple's iPad, which has dragged down Microsoft's shares by 20 percent this year.

Key Takeaways:

  • Microsoft's Windows Phone 7 software is the company's last chance to catch up with Apple and Google's Android offerings in the smartphone market.
  • The new software is expected to be unveiled on October 11 and hit stores by November, following a mock funeral for Apple's iPhone at Microsoft's Redmond campus.
  • The company's share in the U.S. market for smartphone operating systems is less than 12 percent, behind BlackBerry-maker Research in Motion, Apple, and Google.
  • Microsoft missed a generation with its last phone operating system, Windows Mobile, which failed to keep up with the iPhone and Android's sumptuous touch screens and new applications.
  • The company's delayed response to the emergence of tablet devices like Apple's iPad has been a major overhang on its shares, which are down 20 percent this year.
  • Investors are skeptical about the new phones' ability to make up for past mistakes, such as the failed Kin phone, and lift concerns about the company's positioning in the phone and tablet markets.
  • The new Windows Phone 7 devices have a touch-screen interface resembling the Zune music player and movable 'tiles' that access various phone functions.
  • However, they do not appear to offer radical new features that rivals lack, and vendors may be hesitant to support the new software.

Statistics:

  • Microsoft's share in the U.S. market for smartphone operating systems is less than 12 percent (comScore).
  • Microsoft's shares are down 20 percent this year (T. Rowe Price).
  • The company's last phone operating system, Windows Mobile, failed to keep up with the iPhone and Android's sumptuous touch screens and new applications.
  • Microsoft expects to roll out Windows Phone 7 software on October 11 (announcement).
  • The new software is expected to hit stores by November (announcement).

Sources:

  • "Microsoft's weird funeral for Apple's iPhone: Redmond is switching the pieces back" by Bloomberg Businessweek (no date mentioned)
  • "Windows Phone 7 to be unveiled October 11" by Microsoft (no date mentioned)
  • "Microsoft's last chance to catch up in smartphones" by comScore (no date mentioned)
  • "Microsoft's shares down 20 percent this year" by T. Rowe Price (no date mentioned)
  • "The Kin phone: A failed attempt to revive Microsoft's phone business" by Financial Mirror (no date mentioned)

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