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Win Mobile sales miss target, iPhone may play role

updated 09:00 am EDT, Fri August 1, 2008

Win Mobile Sales Miss Goal

Microsoft has missed its much-vaunted yearly goal of selling 20 million licenses for Windows Mobile by a wide margin, the company has revealed. Initially certain that any shortfall would amount to a "rounding error," the company now acknowledges that it has only sold 18 million licenses over the course of its last fiscal year, which ended in June. Microsoft hasn't provided reasoning for the gap, which was unexpected as recently as a month ago.

This may have stemmed in part from iPhone 3G anticipation, according to In-Stat analyst Bill Hughes. The Apple device in question was unavailable until July but may have contributed at least partially to Microsoft's sub-par results by encouraging many prospective customers to wait for the release of the updated iPhone rather than commit to a Windows Mobile device. Microsoft is known to have long struggled with making Windows Mobile relevant to home users rather than just workers and has suffered a minor blow with the iPhone 2.0 firmware, which adds Microsoft Exchange support that may allow some workers to use an iPhone for business purposes in place of a Windows Mobile device.

The deficit of two million phones may also have been supported by existing low-cost alternatives and delays in high-end models. Kevin Burden of ABI Research points to both Palm and Research in Motion successfully boosting sales through a strong emphasis on the home. While Palm has long struggled to appeal to users outside of a small business contingent, the company's recent Centro phone has been very popular at an average $99 contract price and has sold two million units since fall 2007. Sony Ericsson may also have pushed back its first Windows Mobile phone, the XPERIA X1, far enough back in the second half of the year for Microsoft to have held back on shipping the software, according to The 451 Group's Chris Hazelton.

Other Windows Mobile phones announced in the first half of 2008, such as the HTC Touch Diamond, were often released only in the last few weeks of Microsoft's fiscal year and only to certain markets, reducing any positive impact they may have had on final results.

Regardless of specific reasons, the chance also exists that Microsoft incorrectly assumed that a renewed emphasis on smartphones for average users would have an effect, Burden notes. Version 7, the first edition known to be more explicitly targeted at home users, isn't due until later in 2009.



By Electronista Staff
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Comments

  1. LouZer

    Fresh-Faced Recruit

    Joined: Nov 2000

    +2

    maybe

    someone in accounting told the upper brass that just because you're copying the iPhone's UI and OS, you can't add iPhone sales to the win mobile sales.

  1. phillymjs

    Fresh-Faced Recruit

    Joined: Jun 2000

    +2

    Still laughing, Ballmer?

    Not so funny, now, is it?

    A year ago you dismissed the iPhone, now it's starting to eat WinMobile's lunch. doesn't come as a surprise to me, since I've had the displeasure of using god-awful company-issued WinMobile-based phones for a few years now.

  1. climacs

    Forum Regular

    Joined: Sep 2001

    +1

    ha, ha!

    Ballmer, May 2007:

    "There's no chance that the iPhone is going to get any significant market share," Microsoft CEO Steve Ballmer said. "No chance." Ballmer said that he'd rather have the Windows Mobile 6 operating system on 60 to 80 percent of all phones that get sold, rather than the "2 or 3 percent" that Apple's iPhone might get.

  1. dynsight

    Fresh-Faced Recruit

    Joined: May 2005

    0

    Iphones sold

    How many iPhones have been sold (total)? I am guessing about 8-12 million? That seems a bit larger than the 2 million shortfall that MS stated.

    18 Million is a lot, but also small when compared to blackberry.

  1. danviento

    Fresh-Faced Recruit

    Joined: Dec 2005

    +1

    In my experience

    WinMobile is one of the most annoing interfacaes out there, hands down. BB isn't much better when it comes to web interface.

    When you give people an alternative that actually works, word spreads on what they've been missing that should have been there all along.

    Yes, Balmer's posturing (most likely for the shareholders more than anyone else) has officially been exposed for what it is.

  1. kdarling

    Fresh-Faced Recruit

    Joined: Jul 2007

    0

    Apple needed Microsoft

    Apple giving in and licensing Exchange, hardly seems like a "blow" to Microsoft.

    Without it, the iPhone would never be considered for business.

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