Mobile
Phones
Microsoft's
Wireless Aspirations Get A Boost
Arik Hesseldahl, 09.15.03, 11:58 AM ET
It's a match that has been brewing for months.
Microsoft's (nasdaq: MSFT
- news
- people
) aspirations to produce a wireless phone that runs its Windows Mobile
software for handheld computing are finally coming to life, thanks to a
partnership with Motorola (nyse: MOT
- news
- people
)--rumors of which we reported on in July. (See: "Battle Of The Smart
Phones Heats Up.")
The world's biggest
software concern and the world's second-largest manufacturer of mobile phones
behind Nokia (nyse: NOK
- news
- people
) announced the tie-up today. They also introduced the first
Motorola-branded phone to use Microsoft's software, the MPx200, which will go on
sale first in the U.K. with French wireless carrier Orange. The phone
will come to the U.S. later this year, carried by AT&T Wirless (nyse:
AWE
- news
- people
).
The device will hit the market just
as PalmOne (nasdaq: PALM
- news
- people
) and its soon-to-be subsidiary Handspring (nasdaq: HAND
- news
- people
) launch their PDA-mobile phone combination device, the Treo 600.
It's a big customer win for Microsoft,
whose mobile-phone business has sputtered over the years, despite the success of
its Windows Mobile platform, formerly called PocketPC. It also will likely give
Motorola new ammunition against rivals like Nokia; Sony Ericsson, the
joint venture of Sony (nyse: SNE
- news
- people
) and Ericsson (nasdaq: ERICY
- news
- people
), who both make mobile phones that run another handheld operating system;
and the Symbian OS, which they jointly own with others. Motorola had been a
partner in the Symbian venture, but recently said it would sell off its
position, though it will likely continue to produce one or two Symbian-based
phones.
And it is the Symbian platform
that Palm and Microsoft are gunning for. Market researcher IDC, based in
Framingham, Mass., estimates that phones running the Symbian OS from Nokia and
Sony Ericsson dominate the market with a 67% share, while Palm and
Microsoft-based phones account for about 13% each. Nokia alone says it expects
to sell 10 million Symbian-based phones this year.
Microsoft has been trying to launch mobile-phone products and
had built a lot of hype around a product that had been code-named Stinger, which
it had been developing with U.K.-based mobile-phone maker Sendo. That
device never reached the market and is now central to a legal dispute between
Microsoft and Sendo.
Motorola's other
rival is South Korea's Samung, which has also recently announced plans
for Microsoft-based smart phones, none of which have yet come to market. Samsung
also builds phones based on the Symbian and Palm operating systems. Rumors are
starting to suggest that Sony Ericsson may also sign on with Microsoft.
"There is not a straighter pitch in the
U.S. than for Motorola to bring out a phone with the Microsoft operating
system," says IDC analyst Alex Slawsby. "But the phone is going to have
to perform to expectations."
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