It seems pretty clear from Microsoft's messaging (including the carefully placed ‘off the record briefings’) that it thinks Windows Phone will work if it’s given more time, more effort and more execution.
Merge the Nokia sales and marketing teams. Add enterprise features. Pay more developers to port their apps. Make better tools. Keep pushing, and pushing, and pushing, and eventually things will lift off the ground. The shift to mobile is clearly an existential threat to large parts of Microsoft’s business, but unlike, say, Blackberry sales, the Windows/Enterprise nexus isn’t going to collapse any time soon, so Microsoft has time to get things right. Just throttle up and head down the runway - you’ll get up off the ground eventually.
This strategy reminds me of the video below. It works best with the sound turned up.
Given that Windows Phone 8 is effectively the second version since the post-iPhone reboot, you could even invoke the old rule of thumb that Microsoft takes three attempts before it wins. So just keep pushing and you’ll do… OK. The Nokia takeover document proposes a 15% smartphone market share target, which is respectable, though hardly victory and a long way from classic Ballmerian bombast.
The problem with this narrative, though, is that the problems with Windows Phone will not be fixed by product quality, execution, perseverance or capital. Nor can Microsoft count on the market leaders screwing up, which often helped out in the past. Rather, Microsoft is now on the wrong side of precisely the same dynamic that came close to killing Apple 20 years ago: developers are not choosing it.
By the end of the year there will be perhaps 1.1bn Android phones in use, and around 300m iPhones. And perhaps 50m Windows Phones. That’s a very quick decision for most developers, and that trajectory is not changing. Can Microsoft brute-force its way through this? Perhaps. But it seems unlikely.
This prompts the question of what else Microsoft might do. In any discussion of fundamental strategy it's helpful to recall an observation by Santayana: 'Fanaticism consists of redoubling your efforts when you have forgotten your aim.’ What is Microsoft’s aim? Is it to sell lots of Windows Phones? Is it to extend the generation-old strategy of ‘Windows Everywhere’ to mobile? Or is it to be a vital, important and relevant platform and applications company?
Arguably, Windows Phone is just a tactic, and a failing one at that. Microsoft, like Nokia in 2010, should move from denial to acceptance and work out what comes next.
Marc Andreessen famously declared that the web would reduce Windows to “a poorly debugged set of device drivers" (a good example of climbing out of the Trojan Horse before you’re inside the city). But how far down the device stack does Microsoft really need to go? 60% of revenue, after all, comes from enterprise and business services. Does Microsoft need to make the device drivers on a phone? The networking stack? The power management stack? It might like to, but does it need to?
It seems to me that a new Microsoft CEO must at least consider turning Android into a stack of poorly debugged device drivers. After all, Google has stolen Microsoft's natural place in mobile: it is Android that fills the role taken by Windows in the PC world. There is no free slot in the 'poorly debugged device driver' game. But there is a very big one in providing a stable, secure ecosystem, in providing a managed environment for enterprise, in corporate messaging, and in putting corporate documents onto mobile, on whatever platform. And even, perhaps, in providing a polished, safe consumer Android experience. Right now Microsoft is leaving all of that vacant. This screenshot, from a friend at a very big fund management company, is pretty damning. He's organised all his apps by ecosystem - compare Google and Good with Microsoft. Microsoft should not have allowed this to happen.
What if Microsoft were to do what Amazon has done to Android? Make a suite of services for mobile, ranging from sandboxed apps for iOS to a complete ROM for Android, and everything in between. Buy Cyanogen and Good. Make its own launcher, UI and app store? Above all, put Office and Exchange on the iPad.
Once you start down this route the possibilities iterate almost indefinitely. But they all start from Microsoft being on a platform that people will buy and developers code for. Once it arrives there, all the rest of Microsoft's still-remaining strengths might be brought to bear. But if it sticks with wanting to own the kernel then it may end up like the peasant in Molière who dug a ditch around his house and called himself Monsieur de l'Isle.