It's no secret: Windows Phone sales stink. Microsoft's bold, attractive platform has an install base of a meager 2% of the global smartphone market and still sits below 5% in the U.S. smartphone market. The CEO of Samsung, the world's largest smartphone maker, has publicly stated that Windows Phone sales are "lackluster."
The big question is why the widely praised platform isn't catching on. Microsoft, relatively early to the mobile Web, came to the smartphone party late, and has failed to make its case why anyone - hard-core PC users included - should choose Windows Phone over Android or iPhone - or even BlackBerry.
The Blame Game
For years, Bill Gates spoke of a world of slates, smartphones and smart mobile devices - only to have Microsoft repeatedly fail to capitalize on that vision.
Misstep #1: It's hardly necessary to quote Steve Ballmer's snide and foolish 2007 remark suggesting the iPhone would always be a marginal player. Ballmer's strategic missteps have been well documented.
Misstep #2: The "one OS fits all" strategy that now-departed President of Windows Steven Sinofsky championed no doubt delayed the eventual launch of Windows Phone - and needlessly tied the platform's success to the fortunes of the Windows PC, a shrinking market, and the new Windows tablets, an unproven commodity.
Misstep #3: It's likewise easy to blame a hapless Nokia, Microsoft's flagship Windows Phone partner. The Finnish company is still trying to find its way after abandoning its own Symbian and MeeGo platforms and largely ignoring the U.S. market for years.
Each of these mistakes is at least potentially fixable. Execution and speed to market can be improved. Strategy can be revised. App developers can be brought on board. Nokia could right itself. Ballmer has reportedly announced his retirement.
The Real Problem
None of these missteps, however, reveal the actual reason for Windows Phone's continued failure in the marketplace. Worse, the failure of Windows Phone is a problem that may ultimately prove un-fixable. Here goes:
The real reason why Windows Phone has failed because there is no good reason for it to exist.
Go on, try to think of one. Think of just one reason - one customer-facing reason - why Windows Phone should exist? Is it better? Cheaper? Faster? Simpler? More secure? More connected?
Microsoft has designed a smartphone operating system that might be better, maybe even much better, for those things that Microsoft is good at - such as Word, Outlook, Xbox Play. The problem is, those do not seem to be the things that smartphone users want or need.
In 2012, UK telecom carrier O2 commissioned a study of smartphone users. It showed that a typical user spends more than two hours a day (128 minutes) with their smartphone. The majority of this time, however, is spent on activities where Microsoft's Windows Phone offers no significant advantages over iPhone or the best Android devices.
For example, smartphone users spend most of their time browsing the Internet, checking their Facebook status, tweeting, listening to music and sundry other acts. For which of these - or any of these - does Windows Phone offer a superior experience?
The innovative "People Hub" in Windows Phone, for example, may prove the better choice for those who wish to merge all their social networks and contacts under one area. Who cares? In the U.S., the typical smartphone user checks their Facebook page 14 times a day. A dedicated Facebook app, and not a Microsoft social hub, seems likely to be the optimum solution.
And while Microsoft may claim that Windows Phone offers superior email capabilities (a highly debatable position), the relevant fact is that email isn't even a Top 5 feature for the typical smartphone user.
What evidence is there that Microsoft will ever offer a smartphone that provides a superior experience over Android and iPhone for watching television, reading, making calls, listening to music, etc.
Gaming could be the exception. Integration of select Xbox features with Windows Phone could help the platform differentiate itself, but even that is not guaranteed. Already, iPhone and Android offer millions of games, including some of the most popular games ever created. The Windows Phone/Xbox combination still has to prove it can create something more compelling than Angry Birds.
Closing the Window of Opportunity
Is there still a chance for Windows Phone to become relevant? Maybe.
Mobile carriers, eager to limit the power of Android and iPhone, may find a welcome ally in Windows Phone. The opportunities for a successful third smartphone ecosystem do exist - in theory. But Microsoft is not even assured of that third position.
Consider these recent positive words in a blog post from Microsoft's chief spokesperson, Frank X. Shaw:
Windows Phone has reached 10 percent market share in a number of countries, and according to IDC’s latest report, has shipped more than Blackberry in 26 markets and more than iPhone in seven.
Yet, even this most positive of spins reveals the significant barriers to sustained Windows Phone success. Current smartphone marketshare numbers put Android at 48% and iPhone at 19%. However, these are misleading. The third largest smartphone platform is the deprecated Nokia Symbian, with 15% of the market, and BlackBerry legacy platforms with 8% of the market. Android and iPhone dominate new sales.
Worse, the market could be slipping out of Microsoft's reach forever. Each new sale of an Android or iOS device leads to customers purchasing apps, games, music, movies and more, all optimized for that particular ecosystem. The great bulk of such purchases cannot easily be transferred to a new platform - which serves to lock-in customers to their existing platform choice.
Time may be running out on Microsoft to be relevant in the next phase of the global personal computing industry.
To succeed in this environment, Microsoft not only has to show why its device is superior, which it has so far failed to do, but demonstrate how its product is so utterly superior that customers should leave behind all their iPhone or Android content, apps and familiarity. This is a tall order, indeed.
Nor is it wise to expect a new hardware partner to rescue the platform. As ReadWrite reported earlier this year, HP will adopt Android for mobile devices. Could Samsung be the savior? Not likely. While the world's largest smartphone maker already offers some Windows Phone-based devices, its long-term strategy, as Bloomberg Business Week suggests, isn't even about Android, but control of its own platform - just like Apple enjoys.
Windows Phone may be a great-looking, intuitive and well-integrated platform - but it remains unable to convince large numbers of buyers why they should choose it over the market leaders. It's very hard to see how either of those facts will change any time soon.