According to one analyst, if Microsoft is really going to be able to make inroads in the huge leads that Apple and Google have in the mobile market, it will need to rely not on its new flagship Windows Phone 8, but on Windows Phone 7. Huh?
According to Tech Crunch, Roberta Cozza of Gartner Research thinks that Microsoft may be able to pull head to head with Apple by 2016 if Windows Phone 7 grows in market share – at the lower end. This assumes that nothing really game changing will come along between now and then. Cozza is also predicting that Google will continue to outstrip both Apple and Microsoft in mobile market share.
Essentially, the reasoning goes like this: As people in emerging markets move from dumb phones to smartphones they will be looking for phones that are cheap and easy to use. If Nokia is really going to be able to resurrect itself, it is going to need phones aimed at that market and that doesn’t mean the high tech, high priced Lumia 920 with Windows Phone 8.
It means truly cheap phones that will sell well in these markets. Windows Phone 8 requires high end technology and Windows Phone 7 doesn’t comparatively speaking. Creating cheaper Windows Phone 7 phones for the emerging market could help both Nokia and Microsoft capture a larger share of the mobile phone market.
“Obviously Microsoft and Nokia have a kind of special relationship — Microsoft will have to be ready to allow Nokia to work on the overall device in order to reach those price points but our assumption has been driven by the fact that we believe that that can happen,” Cozza adds. ”In some of these emerging markets smartphone applications are not really a key consideration — it’s just to make and put into the market a device with an OS that can scale down to those prices.”
Nokia is currently using its own Series 40 OS on its low end Asha line of phones but it would be cheaper for Nokia to stick with Windows Phone 7 and expand that line rather than continue its own proprietary system.
Expanding its range of handsets by continuing to use Windows Phone 7 might help. On the other hand, handset makers like HTC and Motorola are scaling back the number of handsets and focusing on producing just a few to cut losses from handsets that aren’t selling well.
While it is possible that using Windows Phone 7 to create lower end mobile handsets could widen its market share and Nokia’s bottom line, it could have the opposite effect. It could stretch Nokia to the breaking point without really advancing the market share of the Microsoft mobile OS. We’ll just have to wait and see.