Skip to comments.Analyst: Windows Phone 7 won't hit double-digit market share in 2011 (Bad news for Microsoft)
Posted on 12/13/2010 10:53:16 AM PST by SeekAndFind
Things always get bad when the analysts come out to play, and indeed, for Microsoft and Windows Phone 7, the gloom and doom has begun. Goldman Sachs analyst Sarah Friar wrote in a research note that Microsoft's market share will continue to go south next year, falling to 7 percent in 2011, down from 12 percent this year.
The problem, Friar argues, is that despite a decent variety of phones (including the HTC Trophy, HTC Surround, and HTC HD7), Microsoft hasn't figured out a strategy for tablets. She writes: "A tablet response is still not forth-coming and our early read on Windows Phone 7 has not yet changed our view that Microsoft's share in mobile OSes will remain at only the single-digit level."
Ouch. While we're not sure that Microsoft's market share will remain that low (they've got plenty of cash to burn on marketing, and let's not forget: they're Microsoft), we do agree that they face an uphill climb in the mobile space.
See also here :
Windows Phone 7 won’t hit double-digit market share, says analyst
Despite a flashy product launch and hundreds of millions of dollars in marketing planned to boost Windows Phone 7 sales, its market share won’t reach even 10% in 2011, says a Goldman Sachs technology analyst. And the news for Microsoft gets worse from there.
Goldman Sachs technology analyst Sarah Friar wrote in a research note released this weekend that 2011 will be “more challenging year” than 2010 for Microsoft, according to the TechFlash blog. Top-line growth, she wrote, will fall to seven percent in 2011 from 12 percent in 2010.
The reason? Microsoft still hasn’t figured out a tablet strategy, and Windows Phone 7 will make little headway against Android and the iPhone, not even reaching double-digit market share. According to TechFlash, here’s what Friar wrote:
“A tablet response is still not forth-coming and our early read on Windows Phone 7 has not yet changed our view that Microsoft’s share in mobile OSes will remain at only the single-digit level. For an unlocking of shareholder value, we continue to look for a more aggressive dividend, a more focused consumer strategy, and stronger Cloud-Azure traction.”
The Windows Phone 7 launch has not gone the way Microsoft planned, and has been hurt by poor sales, the indifference of some retailers, and spot product shortages.
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Where were the analyst when the iPhone launched? No one predicted how big it would be.
Let me correct that...didn’t mean to say NO ONE but that many missed the iPhone’s success.
I think Android will the “Windows” of phones & pads.
In PCs you have Apple (one hardware vendor) and Windows (multiple hardware vendors). (Yes Linux people, I know, but we’re talking about consumer devices here, not servers).
Phones will end up Apple (one hardware vendor) and Android (multiple hardware vendors).
Pads will end up Apple (one hardware vendor) and Android (multiple hardware vendors).
And there will be some cross between phones and pads, and some also-ran os’s (just like with PCs), but it Apple and Android should shake out as the big two.
I respectfully disagree. Windows Mobile proved that android is a failed model. Windows allowed OEMs and carriers to sell whatever they wanted and control the user experience. People need a consistent UI and common experience to really do well in the mobile market. Some carriers just suck at forcing their crap on the user and some OEMs make cheap crap for devices.
Windows Phone is trying to bring the best of both worlds. iPhones consistent look and feel appoach and common experience while allowing mulitple hardware vendors, but with a set of standards that must be met.
From what I recall this reflects the gartner report that was issued a couple months ago. Which predicted growing market share for android, flat for the windows phone and declining share for the iPhone through 2014.
They are starting from 0, and considering what “single digit” % is in terms of the total number of smartphones, that could be 10s of millions.
Also, Android started from the exact same point in 2008 and didnt hit double-digits until the past year.
Microsoft never stated that they would have 44% of the market in the span of a few months. Only people that want Microsoft to disappear, and kids that talk smack on the internet, thinks that was their aim in their first year.
And besides if “single digits” was a terrible place to be, then someone tell that to Apple so they can stop selling OSX.
At Thanksgiving, I bought a two-fer of the Samsung Windows 7 phone when my sons phone crapped out....
I was looking for a replacement for my Iphone 3g....
Look and finish was nice...speed was excellent and the phone quality/reception was good...
What failed is the windows software....It does NOT sync with your computer, it cannot support Outlook except in a enterprise environment. There is no visual voicemail which jhas been a basic for all business phones.....Who would have thought that Apple would better support a Microsoft product (Outlook) better than Microsoft?
Go on the Microsoft website blogs for Windows 7 users, at Thanksgiving there were over 900 posts on the one blog all ending in “I’m taking this piece of crap back and never buying Microsoft”
That’s what I did and got the Iphone 4 which BTW I didn’t want to do....the phone portion is inferior to the 3Gs with quality of reception marginalat best...yes the antenna problems are as bad as they stated.
I’m probably going to return the Iphone 4...anyone have some suggestions for a good business phone?
RE: They are starting from 0, and considering what single digit % is in terms of the total number of smartphones, that could be 10s of millions.
Yeah, I guess I should not underestimate Microsoft. Every single technology they manage to dominate the past 15 years, were ones they did not pioneer.
Count them : the spreadsheet, word processors, browsers, database, windows network, etc.
The above were started by visionaries who garnered a huge market share when it first started and then eventually lost it to Microsoft.
We’ll have to wait and see with smart phones as well.
Once Google comes out with their OS, Microsoft is toast. Microsoft’s Windows 7 treats people like idiots, and that doesn’t create product loyalty.
Windows Phone 7 gets to compete against the iPhone, but it’s just not as good. The advantage WP7 has over the iPhone, namely being available on multiple devices, is already filled by Android. My favorite thing about it over Android is a powerful minimum hardware spec, but around now most phones are at a good enough spec to run Android well anyway.
As far as that nice consistent UI, I wholly agree. But Microsoft itself has shown that people have no problem buying crap.
WP7 will have some success for sure. Microsoft won’t let it fail no matter how many dollars need to be spent in advertising and pot sweetening, or in suing the competition.
Unfortunately the best business phone is a junky windows mobile 6.5 or a blackberry.
But if you say business phone, most business now use exchange or have some sort of email. What type of email are you using that you can’t use windows phone 7?
I loved my windows phone 7 so much I am buying my whole family one for Christmas.
Au contraire, I believe it does. Casual market is where the money and the masses are. Think windows beat Unix by being more technically advanced? Nope, it was easier to use.
I'm a techie and believe me I hate the casualization of technical things, but it does do a lot of good though (so I'm not too upset). Look at Xbox 360 it was losing to the Wii in sales until this year. And finally in North America they are beating the Wii in sales....guess what they did? They went casual with it. Kinect is selling like hot cakes in the morning and it's 100% casual (so far). But if everyone ends up with a kinect I'm certain there will be some hardcore games that come along.
I think Microsoft really learned from that mistake with the windows mobile market. They saw people drop windows mobile in a heartbeat and pay over $200 for a phone just to get something a bit more solid. With Androids lack of standards and so many OEMs willing to take advantage of a quick easy sale and android branding--the android is doom to repeat the windows mobile mistakes. I see tablets for around $100 and they are pure junk.
Think about the wife that buys her husband a $100 android tablet thinking it's got all the hype. On christmas morning the husband will be disppointed when he starts to use the cheap tablet. He'll complain to his friends that android sucks and then his friend that has a solid android product will disagree. It will fragment their market and prevent google from really doing anything signficant with it. Other than to allow cheap OEMs to sell cheap phones and tablets where the OEM controls the user experience.
I’m not sure I get the windows hate. I’m now running windows 7 and I love it. Even Vista was pretty good. In the 3 years I ran Vista I only had one serious crash and infection and that was just this year.
Compared to XP, that’s miles better reliability. I really couldn’t understand the dislike for Vista, and I started with SP1 and upgraded to SP3. Even SP1 was different than XP, it was much more stable.
I agree. Most people really do love windows 7. Windows Vista though got a bad rap for a couple reasons.
1) Microsoft had a vista ready and vista capable logo program before it released promising the machine could run Vista, but OEMs didn’t make the proper drivers for it so people got ticked when their machines didn’t run Vista properly
2) The security was changed to require administrator privilege to do any admin type activities on the machine. Which is good security but with so many people loving the ease of XP they hated Vista. Win7 gets a thumbs up here because they require a less onerous process, but to get a thumbs up here Microsoft first had to show people how bad it really should be to be truly secure with vista. People like the compromise in Win7.
3) Vista was the first real push to 64 bit computing and many drivers just weren’t made yet (like printer drivers and graphics card drivers). People were mad because the drivers didn’t exist. With Win7 the drivers are pretty much the vista drivers just rebranded with some minor tweaks so they were easy to get out for Win7. Plus people replaced their old printers by now to make them work with vista. In the end Win7’s success really needed the transition Vista provided.
I love my Windows phone too. It's a much better phone/OS than the iPhone I used to have.
Well getting the drivers vista compliant was a good exercise for me. Taught me quite a bit about computers. Most of the programs I run are/were from the MSDOS period, which was the other big change in Vista as they no longer had full screen support.
That being said, I’ve learned how to run all the programs under Vista and Windows 7 was a pleasant surprise in that all the tricks and workarounds learned in Vista work even better in Windows 7.
My only complaint in the three years I used Vista is the virus I picked up just before I switched over. I wasn’t able to repair the system without reinstalling the OS. Some kind of Java virus. Nasty piece of work, but now my system is clean again under windows 7 and I hope not to deal with that again.
One thing I do like, programs crashing don’t crash out the OS. The least reliable thing in the whole system now appears to be the server, which is good progress.
Many small businesses don’t use exchange....They removed the active-sync. they had on all previous additions prior to Windows 7 so you cannot sync your Outlook calender, contacts, tasks etc. from your computer. BTW, even with exchange it won’t sync tasks or calenders and limits the number of contacts to 1K...
Go to the Microsoft windows 7 blog sites....users are outraged...
What, giant icons weren’t the breathtaking innovation Microsoft thought they were going to be?
Who knew? /s
Maybe they can make a Facebook phone.
Phone 7 is for tablets or phones?
I think the 300,000 Android activiations a day, compared with the roughly 38,000 WindowsPhone “movements” per day (we can only guess how many have actually been activated, as opposed to sitting on store shelves and in warehouses - 50% maybe) blows a huge hole in your theory.
Consumers like the Android operating system (and Apple’s IOS) and will buy the quality Android phones that meet their needs and budgets, while leaving the lower quality ones on the shelves. With all the tech sites and consumer reviews out there, it doesn’t take long for the public to know which devices are worth buying. As long as I know I am buying a quality phone, why should I care if inferior models are running the same OS.
Microsoft waited far too long to launch WP7, (and it still isn’t ready for primetime without cut and paste and other basics) and did it on solid, but not cutting edge devices, (with equal or less impressive specs as Android and iPhones rolled out months earlier), and rolled it out with one of the dumbest advertising campaigns in history (Windows: The Phone you won’t really use much!)
Oh yeah, and with, at least for now, a far inferior app market. They even copied the green and white shopping bag Android Market icon, with a window replacing the little robot. How innovative!
As far as I can tell, there is nothing about WP7 that is going to make an Android or IOS user want to switch.
The market is way bigger than the current android and iPhone users. That's who they are really targetting. In a growing market there are plenty of players. The question is which ones are setup to last for the long haul. Being first to market doesn't mean you'll be the best or the one last standing. Microsoft does know how to move into markets that other people discover better than any other IT player.
Calling them giant icons shows you really didn’t even look at it. The UI is really unique and different from the other smartphone competitors. I thought I’d hate it, but giving it a shot I actually prefer it over iPhone. And android well it’s no competition. Android is a hodge podge of garbage.
LOL! Thought you'd hate it? You've been a Microsoft fanboy from the get go, please don't try and pretend you're not.
I do like Microsoft but I thought they made a mistake with the UI to windows phone 7. In fact, I thought they should stick with windows mobile but lock down standards and use that as the baseline.
But I guess I was wrong this time. At least I can admit it. BTW: if you search you can find on FR where I voiced concerns over the UI and scrapping WM.
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