Tech blogger and former Microsoft employee Robert Scoble drew some attention today for suggesting that Microsoft should abandon Windows Phone.
Scoble is an easy target -- he'll never live down the Google Glass shower thing -- but in this case he's making a pretty rational point.
Windows Phone was Microsoft's attempt, four years ago, to grab a profitable chunk of the smartphone market from Apple and Google before it was too late.
It didn't work. Microsoft's share of the smartphone market is still well under 5% -- as it's been since Windows Phone launched in November 2010. Windows Phone shipments are growing overall, and it's the number-two platform in some countries like Italy, but overall, worldwide, its market share makes it insignificant to most developers, users, and companies.
(I don't always subscribe to the church of market share, as installed base is more important for drawing developers, but every year that Windows Phone stays a bit player means it will have to take even more market share in the future to make a dent in the installed base. Also, I know that Android isn't really a single platform but has multiple versions and forks and runs on all kinds of devices with different screen sizes and specs, but in general the various Android platforms are closer together than Android and Windows Phone are -- and in most cases, an app maker starting from scratch will get more users with an Android app than a Windows Phone app.)
Microsoft's dreams of achieving 10 or 15 or 20 percent market share with Windows Phone look to be just that -- dreams. It could happen, but based on all evidence so far, there's zero reason to assume it will.
So if it's doomed to be a perennial also-ran, what is the point of Windows Phone? Why should Microsoft keep investing in it? If Microsoft under Satya Nadella is really serious about making the cloud the platform for the next generation of the company, why not just build cloud services and clients that work equally well on competing client operating system platforms?
Here are a few possible reasons.
The developer argument. PC sales are flat. Most of the growth in computing platforms over the last few years has been in mobile devices, particularly smartphones. As Microsoft pursues its "One Windows" vision, in which the various versions of Windows -- desktop, tablet, and phone -- get closer to the "write once, reuse most of the code and tweak slightly to run everywhere" ideal, it must have a feature-competitive mobile platform to keep developers engaged. If Microsoft were only to focus on the PC and tablet, it would lose all those developers who believe the future of apps is mobile-first.
Yeah, but: With insignificant market share, Microsoft is basically irrelevant in smartphones anyway. It's hard to imagine a mobile-first developer investing in Microsoft before iOS and Android, unless they already have a big Windows app business or a ton of Microsoft-platform experience anyway and want to leverage that into mobile platforms, perhaps via Xamarin.
The lock-out argument. Microsoft's biggest business today is selling productivity and back-end infrastructure servers and the client apps that go with them. Its most promising business is selling cloud services that replace or augment those servers -- and still work with the same client apps. If Microsoft allows Apple and Google to control the smartphone market, those companies could make arbitrary, secret, and/or difficult-to-reverse-engineer changes to their platforms that block these Microsoft apps and services from working properly. Having Windows Phone gives Microsoft a trump card -- at least for enterprises who rely on Microsoft's productivity servers, services, and software and want to enable a mobile workforce. (Consumers may not care as much, or at all, given the well-developed ecosystem of apps and services on iOS and Android for every imaginable personal productivity function.)
Yeah, but: Plenty of other ISVs and service providers have built cross-platform mobile apps that work equally well on iOS and Android. If Evernote and Dropbox can stay on top of Google and Apple's platform changes, surely Microsoft with its financial resources and experienced developers can do the same. If anything, Microsoft would seem to have more leverage over these platform providers than smaller startups -- surely Apple and Google want their phones to be used happily and effectively by the tens of millions of workers who must use Microsoft apps and services to get work done.
The showcase argument. In his memo announcing significant layoffs in the phone group this month, Stephen Elop hinted that the role of Windows Phone and Nokia hardware within Microsoft is to show the best possible mobile experience for Microsoft services and apps.
"It is particularly important to recognize that the role of phones within Microsoft is different than it was within Nokia. Whereas the hardware business of phones within Nokia was an end unto itself, within Microsoft all our devices are intended to embody the finest of Microsoft’s digital work and digital life experiences, while accruing value to Microsoft’s overall strategy."
In other words, if the future of computing is mobile, having a mobile platform and mobile hardware will help Microsoft grok the upcoming changes and uncover useful future scenarios while driving the whole market to innovate faster. It can then build software and services optimized for these new scenarios and hardware.
Indeed, the cameras on recent high-end Nokia phones are astounding. Windows Phone still has the best contact management and social media integration of any of the major mobile platforms. The integration between Windows Phone and services like OneDrive and Bing are appealing (or could be, in theory, if these services were best of breed -- my experience with the mobile version of Bing suggests otherwise). Keeping a hand in the important computing platform of today -- mobile phones -- is the only way Microsoft can make sure it's leading the computing platform of tomorrow, in which every little thing in the world is connected up and exchanging bits of data. ("Ubiquitous computing and ambient intelligence.")
Yeah but: That's an awfully expensive research project.
There are other more human -- and perhaps less rational -- arguments as well.
For instance, the ego argument: Microsoft was once the dominant platform company so it can't imagine not being a player in the most relevant platform war in computing today.
Or the "might as well" argument: Microsoft has already spent four years going in this direction so it might as well keep going -- it would be just as hard and expensive to retool around iOS and Android than it would to move forward with its Windows-everywhere strategy.
Or the "war of attrition" argument: Tech changes fast. Leaders stumble. Microsoft has benefited many times from swooping in when a market leader showed weakness or made a tactical error -- Sony in game consoles, Netscape in browsers, even IBM in the original PC wars.
I don't know the answer, but I suspect it's a combination of all of these. Right now, there are enough reasons to keep doing Windows Phone, and not enough reasons to radically shift course, that Microsoft will keep it alive indefinitely, even if it keeps limping along.
The only thing that could stop Windows Phone is if the company as a whole runs into much bigger problems. And so far, despite all the pundits' predictions to the contrary, Microsoft's earnings just keep chugging along.