Microsoft's latest quarterly results show such abysmal phone sales, it's hard to believe that the Windows 10 Mobile ecosystem can recover. Less than a week ago, we covered the new partnership between Microsoft and TripAdvisor[1], and speculated that Redmond might be trying to leverage its desktop and laptop market share to boost phone compatibility. It seemed like a long shot, but cross-platform app compatibility was one of the major selling points of Windows 10. After seeing how much Windows 10 Mobile device sales have declined, however, I'm no longer certain even this long shot has a chance of working.
The supposed ecosystem just isn't coalescing.
Microsoft's smartphone revenue fell 49% last quarter, after accounting for currency fluctuations. The company's Form 10Q[2] contains some ugly details: Microsoft shipped 4.5 million Lumia phones and 22.5 million "other" phones in Q4, compared to 10.5 million and 39.7 million devices in the prior year.
What really makes this situation ugly is the fact that Microsoft launched three new devices in Q4. The Lumia 950 and 950XL were modestly well-received (the Lumia 550, not so much), but ongoing bugs in Windows 10 Mobile and Microsoft's much-hyped Continuum feature were criticized as half-baked. The general consensus from reviews is that Windows 10 Mobile and the new higher-end Lumia devices are perfectly adequate — but nobody is going to switch away from iOS or Android because Windows 10 Mobile is adequate.
To put this in further perspective; an estimated 400 million smartphones were sold last quarter. A bit more than 1% of them were Lumia-branded smartphones (it's not clear which devices are included in the "other" category). Like Blackberry[3], Microsoft faces steadily declining revenue and a shrinking user-base. Granted, Blackberry would love to be putting up Microsoft's numbers, since it only sold an estimated 0.7 million devices in fiscal year Q3 2016, compared to Microsoft's 4.5 million Lumia's but device shipments are falling steadily at both companies. The Priv has yet to reverse Blackberry's overall decline, and MS has no equivalent plan to launch branded Android products.< /span>
Microsoft missed the boat
I know we've got some Windows Phone fans, including Jamie himself, so let me be clear — I'm not saying Windows 10 Mobile deserves to die, or that it's a bad OS. As near as I can tell, there's a bit of karmic reversal going on here. Microsoft's old smartphone OS, also called Windows Mobile, never deserved the market share it enjoyed, while Windows Phone 7 and its successors never found a market for what they had to offer.
It's hard to see a future for Windows 10 Mobile. Even the idea that MS could leverage its PC ecosystem to bring apps to mobile devices still rested on the assumption that someone was buying the hardware.
Unlike The Verge[4], I'm not quite willing to declare Windows Phone dead, if only because Microsoft has the resources to keep working and iterating on the platform. After seeing these Lumia figures, however, it's obvious that Windows Phone is on life support with little chance of recovery.
There's nothing wrong with Windows 10 Mobile's features or capabilities, but they should've been introduced 3-5 years ago. If Microsoft had offered users the ability to move apps and data flawlessly between mobile devices and desktops back in 2011 – 2012, it might have captured much of the early tablet market and set the course for the future of mobile computing. Instead, it's slowly being squeezed back into the desktop/laptop market.
References
- ^ Microsoft and TripAdvisor (www.extremetech.com)
- ^ Form 10Q (www.microsoft.com)
- ^ Like Blackberry (www.extremetech.com)
- ^ The Verge (www.theverge.com)
