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Weekly Column

Collateral Damage: Why Windows Mobile will die.

Status: [OPEN] comments (93) | add a comment
By Robert X. Cringely

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I am not a very sophisticated mobile phone user. I don't use most of the bells and whistles on my phone, probably because I don't know what they even are. But just because I'm an idiot about USING mobile phones doesn't mean I don't understand the emerging mobile market, to which I have been paying a lot of attention of late. And why not? As personal computers fade from what Al Mandel called "ubiquity to invisibility," something has to take over. And everyone I respect thinks the new dominant platform will be mobile. So it's my job to tell you, then, that Windows Mobile is probably doomed.

Interestingly, this conclusion isn't based on any personal preference or subjective analysis. I'm not saying that Windows Mobile is bad, just that it is probably doomed. It's a simple matter of market economics.

There is generally room in any technology marketplace for three competing standards. Notice I say "standards," not "brands." There can be many brands of road vehicles, but they generally come down to cars, trucks, and motorcycles -- each a standard. In personal computers we have Windows, Macintosh, and Linux (or similar Unix workstation variant). In HVAC systems, just to stretch the point, there are radiant, forced air, or evaporative systems -- again three standards.

And among those three standards there tends to be a market-share distribution that is more or less 85-10-5. These numbers can jump around a bit and one can argue that the Mac is now more than 10 percent of recent sales, though not of the installed PC base, so I hope you get my point. This magic 85-10-5 distribution also happens to mirror what happens at the racetrack or in the casino, where 85 percent of gamblers lose, 10 percent break-even, and 5 percent are winners, which explains all those big buildings in Las Vegas.

The mobile phone marketplace shows a similar distribution, though that now appears to be in some transition. One could argue that the old 85-10-5 came down to basic or dumb phones (85), smartphones (10), and specialized or vertical phones like the old Nextel (5). Moore's Law now seems to be inexorably turning all phones into smartphones, so we're probably moving toward an 85-10-5 based on programming platform.

Let's consider this smartphone migration for a moment, first with Samsung in mind. Last week Samsung announced that it would no longer be making high-end phones and would stick to basic phones in the future -- going for higher volumes at lower cost. This makes a lot of sense given that sophisticated phones must cost more to develop yet tend to be more expensive as a result and therefore have lower sales numbers. So why bother? This was the message Samsung sent out and everyone bought, but I really think that if you look at it in the context of a dynamic market the announcement means something else altogether.

Deconstructing the Samsung announcement we'd have to wonder how the company sees itself and its competitors. That answer is pretty simple: Samsung sees itself as a global electronics company competing with outfits like Sony. Samsung has been for 40 years all about copying and eventually crushing Sony. Now given that's how Samsung sees itself (nobody I know contests this vision, by the way), how can the company possibly afford to let Nokia, Motorola, Sony, and Apple make high-end phones, which is to say smartphones, without Samsung competing in that space? That would be giving up a lifelong dream and Samsung just won't do it.

So were they lying?

No, Samsung wasn't lying, they were just doing what my old friend, PR man Martin Quigley, called "dissembling." Samsung probably has no intention of abandoning the smartphone market because ALL phones are becoming smartphones. What they truly intend to do, however, is make smartphones that are generally inexpensive, hoping to gain market share as a result. We'll see this trend from Apple, too, which will push iPhone prices down and introduce cheaper models next year and beyond.

While there are many ways for Samsung to make smartphones less expensive, the easiest way to do so and yet remain competitive on features is by no longer using software that costs money.

In the smartphone space there are, at present, only three operating systems that are being broadly licensed on an OEM basis -- Android, Symbian, and Windows Mobile. Of those three, two are free -- Android and Symbian. Symbian didn't used to be free but times change and now it is.

So Samsung was announcing that it would be ending development of Windows Mobile devices at some point, though they never said that directly.

Sticking with Samsung for a moment, then, which of the two free software platforms is the company likely to endorse? That's a good question. Symbian has a very strong presence in Japan, which is an important market for Samsung, so I don't see them abandoning Symbian immediately. But in the longer term I think Samsung WILL abandon Symbian, as will most of the rest of the world.

Here's why (donning flameproof clothing): Symbian is simply too old. The OS is getting slower and slower with each release. The GUIs are getting uglier and are not user-friendly. The development environment is particularly bad, which wouldn't hurt if there weren't others that are so much better. Symbian C++, for example, is not a standard C++. There is little momentum in the Symbian developer community, maybe because coding for Symbian is a pain. Yes, there are way more Symbian phones in circulation, but those phones will be gone 18 months from now, probably replaced by phones with a different OS. Lately, Symbian's success has been primarily based on the high quality of Nokia hardware, on the loyalty of NTT DoCoMo, and now on the lure of being recently made open source and therefore free. But if open source developers don't flock now to Symbian (they aren't as far as I can see -- at least not yet) then the OS is doomed.

My guess is that in time Samsung, like Motorola, will devote its smartphone development 100 percent to Android.

Maybe, but what about Apple and RIM, what will happen there? This is not a time to bet against the iPhone, which is changing the entire landscape of not just smartphones but mobile phones in general. For all its teething problems, there is a new sheriff in town and his name is iPhone. We'll see nothing but progress and market-share gains there for at least another two product cycles or three years.

RIM is another story altogether. What RIM has going for it are loyal users, good keyboards, and push mail. Most mobile phone users still think RIM is the only platform that has push mail. But given that push mail will soon be everywhere and the market will eventually figure that out, RIM is facing a huge challenge. I'm not saying they won't meet that challenge, I simply don't know.

If I had to bet right this moment on the mobile 85-10-5 of 2011 I'd say iPhone, Android, then RIM, Symbian, or something completely new from behind Door Number Three.

Why iPhone over Android? For exactly the same reason why the iPod holds that approximate 85 position among music players, including ones using open source software. iPhone has a really great SDK (light-years ahead of any other right now). The App Store distribution platform is great, but locked on too many points. This is a careful timing issue for Apple. If they open the APIs too quickly they risk being blocked. They need to open an API once they are perfectly sure it is the right one and the right way to export that function. Apple is going to relax the restrictions progressively when they better understand the use cases and what are the best APIs. In the meantime it is giving an advantage to Android, but one that I think a year from now Apple will have reclaimed.

And where will Windows Mobile be in 2011? There way things are headed now, given that Microsoft can't really afford to be anything but first or second on the platform that supplants Windows, I'd say Windows Mobile will be dead.

Comments from the Tribe

Status: [OPEN] read all comments (93) | add a comment

I think that Bob has his prediction spot on; generally, his idea is that in the marketplace a product which is
1. either best in features and customer usability (iPhone) wins
2. a product with best price wins (free Android)
3. All others are not needed and will slowly disappear

We don't know exact market shares for those; though, interestingly, its quite close to browser shares - IE, Fifefox, Safari/Opera; and the market is probably not an emerging one like India, but a mature one, and Indian market will mature soon (in terms of services, not quantity); those shares will fluctuate anyway so its not so important anyway.

But the main point is of course spelled clearly. Since no one wants to pay, Android will be first choice for all except Apple; they will do great with their own OS X on iPhones and have enough share to prosper, be it 85 or 10; even 10% actually is huge market.

There is no place for WinMo, and no, cellphones are HARDLY a continuation of desktops; indeed, no one would like to mess with desktops to get functionality from cell phones. Thats why Apple is moving away from using desktops for iPhones; its incoming firmware will allow for example a direct download of podcasts; even now, generally speaking, its a small computer on itself.

Evolution of iPhone will lead to iPhone mini and iPhone shuffle, so to speak, as well as iPhone Maxi/Apple tablet - a natural continuation of line and need to have all price points dictates this. I think we will see cheaper iPhones as soon as Android will result in cheaper smartphones. iPhone revolution is just beginning. With development of wifi and 3G iPhones will be the preferred choice just as iPods did to mp3 market due to its usability and customer friendliness, thing which cannot be overestimated for consumer electronics. WinMo will never be popular in emerging markets due to its price and cost; Android may win there. So you have iPhone dominating mature developed markets and Android dominating emerging markets. Together they will crush any WinMo device as well as RIM and so on.

Hash | Nov 01, 2008 | 4:56PM

Wow, Triumph of the Nerds again?... So do you really predict that Steve Jobs will beat them all on the mobile platform market?...

As a Mac fangirl (should I say "cult member"?) and obviously a proud owner of an iPhone (and at least 4 Macs...), I wonder, though, if the iPhone will "dominate the market" in 2011 with 85% market share — it sounds almost impossible, given that I actually see the same thing happening as on the desktop: a handful of alternatives that run on all "mobile hardware" — Android, Symbian, Windows Mobile, etc. — and one single alternative locked to a single hardware solution, Apple's iPhone. If history repeats itself, the "mobile OS running on multiple platforms" will dominate the market, leaving behind the "mobile OS running on a single platform". In that case, the choice will be between Microsoft and Google, and I'd hate to bet on either. Both platforms look positively outdated, clunky, and unusually user-unfriendly — put into other words, they are good for developers, probably even better for mobile hardware vendors (which can pick between a free platform or a paid one), even if they're terrible for end-users. Still, as the desktop OS wars showed, at the end of the day, Microsoft won the battle "proving" that their OS is what users want.

When the iPhone 3G was launched in all of Europe, mobile operators — the other players in the field, it's not just users & hardware manufacturers — simply hate it. They shrugged off the "15 million iPhones sold in a year" by claiming that just Nokia phones, in the same timeframe, sold 150 million phones — and of course Nokia is just "one of many" manufacturers. They also hate the idea that their customer support has to teach their customers how to use iTunes (you really can't use the iPhone without it, as Apple obviously knows very well). They even hate more the idea that the notion of "service" starts to get pushed outside their own websites (e.g., distributing useful applications) and into Apple's own hands (since Apple has a *way* better solution — again, from the point of view of the end-user). And they probably fear that Apple will relegate mobile operators to just "infrastructure providers", as Jobs claims. With iTunes, he's breaking the backbone of "music distributors" (he wants to connect artists directly to users — through Apple's own infrastructure). With mobile applications — which, on a iPhone, are just "cool computer applications" which happen to be able to use mobile infrastructure as well — Jobs wants to put software developers directly in touch with end-users, easily and without any fuss. All iPhone users have, through the same interface (either through iTunes or through the iPhone), access to *all* iPhone applications, *anywhere*, immediately. And that includes instant upgrades, too.

So this is going clearly to cut into *one* big service area for mobile operators, which are not happy. Perhaps they even fear that Jobs is right (he usually is...) and that the way the iPhone works (besides the shiny box in your pocket) is what users want. But not what mobile operators want. Jobs doesn't play by their rules; he only plays by his own rules. His point is well made: if a mobile operator doesn't want to sign an agreement under *his* terms, he'll just pick another one. Users will flock to operators willing to support the iPhone.

That's all very nice — and obviously good for Apple and their stakeholders — but will that lead to market dominance by 2011? I find it very, very hard to believe, even as Apple's fangirl.

No, I agree with "delta force" above. Apple, as usual, infuses the "cult" message with their iPhone. Unlike Android — "a free mobile OS for everybody", Apple's back with their usual marketing: the iPhone is for an elite of users. Special people. Creative people. The ones that don't want to be part of the mediocrity. The elite.

No, I don't believe in an "iPhone Lite" for US$35. Apple's simply not into that business. They'll run ads with "Hi, I'm an iPhone" and explain very carefully why you are special for shelling out US$500 (for an unlocked iPhone...) for a computer-in-your-pocket (which also happens to make phone calls) and why the rest of the world has to endure a non-hippy, old-fashioned, obsolete Plain Old Mobile Phone, even if it costs just US$35...

That'll give Apple a 5-10% market share, with perhaps 150-300 million iPhones worldwide. Not bad, of course, but definitely not world domination by the nerds.

We simply aren't enough :)

Gwyneth Llewelyn | Nov 06, 2008 | 9:12PM

There are rumors of a Zune phone. Sign me up for that! I think Windows Mobile still has many advantages over some of the newer devices and it is proven technology, very widely accepted, and most importantly there are many many people developing and sharing applications for it.

Chris | Dec 26, 2008 | 6:44PM
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