Microsoft had a tough year gaining traction in the mobile space, but the software giant is hoping that a new strategy centered on the release of Windows Mobile 6.5 will help it gain up to 60 percent market share, executives said Thursday.
"It was a tough year on succeeding in phones," Microsoft chief executive Steve Ballmer said at the company's annual financial analyst meeting. "Mostly our own issues; and really driving our execution the right way at the right speed, [but] we've readjusted some of our plans."
Robbie Bach, president of Microsoft's entertainment and devices division, provided some more color on what those plans entail, including: the inclusion of Windows Mobile on a broader selection of phones; a shift from a business to consumer focus; cloud services; building up the Windows Phone brand; and building better relationships with hardware manufacturers.
"I still very much believe in the opportunity to be a for-profit software-only player in the phone business," Ballmer said. "I think that's the winning approach. I think it's the right niche. I think it is the right way to get 50–60 percent kind of market share, maybe the only way."
Windows Mobile 6.5 is set to debut in October. Microsoft first unveiled the new mobile OS, which is designed to make touch-screen phones easier to use and improve Windows phones' Web-browsing skills, in February at Mobile World Congress in Barcelona.
When it does debut, Bach said, the OS will have a consumer-friendly edge.
"If I have a critique of our phones today, it's that our experiences are very good in the business case," Bach said. "But, if you're in the consumer space, and you have consumer scenarios, you want to do more browsing, you want to do more media, you want to do more video, you want to do those types of things, our experiences aren't as rich as they need to be. And starting with 6.5 and then going forward, you're going to see us expand those experiences dramatically."
Bach also pledged to work closely with handset makers like Samsung, LG, HTC, Hewlett-Packard, and Sony Ericsson to build a broad selection of phones.
"It's our view that one model, one type of phone is not going to build volume into that critical mass that we think we need to make the business successful," Bach said.
Bach also talked up MyPhone, a free service that syncs Windows Mobile 6 smartphones with a password-protected Web site that can be accessed from any PC, as a means to take advantage of the cloud. MyPhone is another product that made its debut at MWC and went into a public beta in May.
"There's a whole set of those types of services that we want to expand into, and I think those cloud-based services brought to the phone as well as to the PC and the TV are going to be quite powerful," he said.
It won't be very powerful if consumers don't know what they're buying, so Microsoft will also focus on building its brand name.
"We will invest in that with retail and we'll invest in it with our own advertising money to make sure people understand when they see those types of experiences that that's a Microsoft experience delivered on a Windows phone," Bach said.
Finally, Bach acknowledged that Microsoft has not "done as good a job as I would like in building the relationships and getting the right level of integration with our hardware OEMs." He promised a "dramatic improvement in the integration between what we do in the software and what our hardware partners do on the hardware side."
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