In a previous blog post I covered how Apple’s iPhone and Google’s Android phone operating systems were pulling away from the emerging second tier phone operating system providers Microsoft, Nokia and Intel. As these second tier players lose more and more market share these suppliers thrash their operating systems to respond to the competition.
As covered by Ashlee Vance in a well done NYT article, the stakes are high. Microsoft’s share alone moved down from 11.8% to 8.7% (according to Gartner) in a year, while smartphones with other operating systems are surging. Analysts expect more smartphones than PCs will be sold by 2012.
Microsoft’s strategy originally followed the Windows desktop in an effort to leverage the huge installed base and existing user’s “muscle memory” from using Windows every day – a great strategy in theory. The reality was a user interface that didn’t fit in the limited real estate and keyboard of a smart-phone user interface and sluggish performance based on the overhead-heavy Windows architecture. This strategy has backfired, and now Microsoft is moving to mimic it’s Zune music player.
Microsoft has its work cut out for it. Can the company develop a strategy that keeps them competitive without leveraging the installed base of Windows? Is the Zune interface really the one to mimic? Microsoft is also pushing to control the headset design that uses its operating system, a business tactic that is bound to get some push-back from smartphone suppliers.
From a strategy standpoint, Microsoft’s strict adherence to software worked well with a PC architecture, where it dominates. It does not transfer to the smartphone environment. Apple has always controlled both the hardware and operating system, giving it total control of the user experience. Google, with its Android operating system, is following the same course of action by developing its own hardware platform while making the operating system widely available to other handset suppliers.
Stay tuned. As Microsoft’s strategy unfolds I’ll continue to blog about it.