Market News

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Smart Phone Market: Demise of Windows Phone or Resurgence of Nokia ??

From the very beginning of the computer era, the Windows platform has been enjoying almost a monopolized presence in the PC landscape. But when it comes to the mobile arena, Microsoft is nothing but a small fish in a large ocean largely dominated by Android and to a lesser extent by iOS. Ever since the disintegration of Blackberry, Microsoft is the only viable third alternative. The Windows phone is pretty much out there for those who seek an alternative to Android & iOS.

The global market share of the Windows Phone market hovers at just under 4%, a level that hasn’t improved much since the first version, the Windows Phone 7, was launched in October 2010 and the predecessor to 8.1, the Windows Phone 8.0, was launched in October 2012. On the other hand, Android is booming, dwarfing the competition with a 81 percent share of the smartphone market (excluding basic mobile handsets), a number supported by both the Canalys and ABI Research reports. Apple’s iOS is holding its own with a sub 20 percent market share. As per the data released by Comscore, Android, Apple and Windows hold 52.1%, 41.9% and 3.4% of the US market share respectively.

The Windows Phone operating system is an excellent platform and it brings a number of innovations to the table. Also, Microsoft has considerably grown its stable of Windows Phone hardware partners since the start of 2013. The underlying rationale is that as OEMs get behind the platform and device portfolios continue to scale the cost spectrum, the Windows Phone will continue to gain momentum. Nevertheless, the Windows phone has not been a hit and Microsoft attributes it to the following reasons:

 The lack of clarity over branding
 The lack of developer support
 Microsoft’s late entry into the mobile OS market
 The overall lack of visibility of Windows Phone-powered handsets.
 The fact that the Windows Phone store had only over 240,000 apps in late February.In contrast, Google Play and Apple’s App Store have more than 1 million apps each.

Further, the 8.1 update includes features that analysts said won’t be anything special when compared to the market leaders Android and iOS. The features include a new notification center and Cortana, the code name for Microsoft’s new voice-activated digital assistant, which compares to Google Now and Apple’s Siri. Hence, in the present Windows is not likely to pose a serious threat to Android & iOS because both the platforms are too well established, have too much market traction and are too widely supported by developers.

Hence, at present Microsoft operates business on the principle of “if you can’t beat them, join them”. Embarking on a newly charted out strategy, the Company has set a target of achieving Nokia’s sales worth 15% of the global smartphone market by 2018. In order to achieve this, the company is largely focused on the developing markets such as China, India, Indonesia and Brazil. The strategy is to incorporate Windows’ services such as OneDrive, Skype, and Outlook.com rather than Google’s services on the Nokia’s initial X and more recent X2 line of budget-priced Android phones targeted at the developing world. Microsoft would make money via its services. However, even if Android powered Nokia phones sell well, Microsoft will still prop up Windows phone because the Lumia line is Nokia’s flagship, and typically are higher-priced phones.

The company believes that once people get used to the big-tiled interface of Android’s Nokia phones, they might eventually switch to the Nokia Windows Phone (Lumia). Still, even if Microsoft and Nokia roll out Android Lumia phones, the Windows Phone is likely to survive. This is largely owing to the likely emergence of the strong points of Windows on account of the evolution of its OS that might come around the launch of Windows 9. IDC’s revised forecast released on 28th May, 2014 the market analyst projects that while the top three smartphone platforms will retain their rankings over the next four years, Android and iOS will lose some ground while the Windows Phone will continue to witness steady growth. IDC forecasts that amid slower growth for the smart phone industry as a whole, the Microsoft mobile OS will surge ahead to gain a market share of 7% by 2018.

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