Microsoft's Smartphone Strategy Is Simple, It Will Change The Rules
Of all the manufacturers who are making smartphones, Microsoft has the simplest approach to hardware. All Redmond has to do is turn up, and it can count that as a victory.
Every software app released by Microsoft on iOS or Android is another step forward in CEO Satya Nadella’s mobile strategy. Each user who signs up to a service in the cloud, each application downloaded, each document edited via the cloud, each of them is another tiny win for Microsoft. The loaded phrase of “cloud first, mobile first” does not commit Microsoft to selling smartphones.
So why does Microsoft still get involved in the hardware game? Because it has a simple goal, which is to remind everyone that it is still there and still playing. That’s enough. The flip side is the software and services strategy, and that is focused on bringing in the big money and keeping Microsoft relevant over the next five to ten years.
Microsoft Lumia 950 and Lumia 950 XL (image: Ewan Spence)
Windows 10 is a vision that has taken a long time to form. It is an operating system that will be constantly updated and effectively have no end of life moment, it simply rolls on with more and more updates. It is designed to run not just on the desktops and laptops of this world, but tablets, phablets, smartphones, smartwatches, ‘Internet of Things’ devices, and beyond.
The Surface devices show that the OS can function perfectly well as a tablet device, and the Lumia 950 and Lumia 950 XL are the first smartphones to have Windows 10 installed by default. Yet Windows 10 is still primarily a desk-bound system which can run pretty well in other form factors.
The fact that the Lumia 950 and 950 XL handsets exist is the big signal. The value in being able to say that Microsoft has a smartphone presence – even if it is one with a tiny slice of market share – is far more important than having no hardware presence and relying on the cloud of apps available for other platforms. While other manufacturers may roll out Windows 10 devices in the future (and there are strong signs that manufacturers such as HP have Windows 10 mobile devices approaching release) simply being part of the conversation is a big win for Microsoft.
Consider any articles that are looking to do comparison pieces or discussions around smartphones. With Microsoft releasing handsets it’s hard to ignore Redmond as the ‘third mobile platform’, even if it is the comfortable definition of a niche platform. Microsoft is just too big to ignore, so it will always be considered, no matter its share.
That keeps Microsoft’s name in the public eye, which has a knock-on effect of gifting Microsoft’s mobile applications an air of respectability and modernity that would be harder to maintain if all they had to offer were software downloads and access to the cloud. Those apps are the end products that Microsoft is monetizing. Windows 10 on the desktop is doing much of the heavy lifting in terms of user acquisitions, but there must be some thought given to delivering mobile users. That’s why Microsoft’s apps are available on iOS and Android. That’s why Microsoft is investing in marketing, developing, and acquiring apps. That’s why Microsoft will keep paying the table stakes to stay involved as a hardware manufacturer.
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