After the glory history of computer operating system and software, Microsoft isn’t always proceeding smoothly in its non-monopoly fields. After answering the competition of the initial state in a hasty manner, Microsoft’s strength in carving out new business is gradually revealed.
From Windows Live to Bing search engine, from Xbox to Windows Phone, Microsoft maintains sufficient expanding power in the diversified and severely competitive IT application market. Upon its mighty accumulation of software and user experience, Microsoft adopts a backward strategy through following leading competitors; also, by virtue of its advantage in integration and development, Microsoft mixes its own innovative technology and surpasses competitors in the final. On the strength of fruitful results made by such new and existing rivals as Apple in the field of smartphone, Microsoft recently launched the strategy towards smartphone based on Windows Mobile operating system in an all-round manner.
Only smartphone is featured with bright future but severe competition. In view of the core software of smartphone - operating system, Microsoft’s Windows Mobile is faced with cut-throat competition from Nokia’s Symbian, Blackberry’s RIM and Apple’s iPhoneOS, etc. Moreover, Microsoft couldn’t enjoy market supremacy as a software provider against three big rivals with powerful ability of software and hardware integration, so it could merely turn to hardware manufacturers for cooperation. Therefore, Microsoft must do something worthwhile when Android made by its old rival Google is joined. On the one hand, at MWC2010conference in February, Microsoft launched a tailor-made smartphone based on the operating system of the next generation - Windows Phone 7 in a high-profile manner; on the other hand, at the beginning of this April, Microsoft unfolded the magic veil of its self-owned mobile phone – Kin of the original “Pink” project.
Similar to the combination of Google’s Android and Nexus, Microsoft also adopts portfolio strategies, i.e., a tailor-made mobile phone based on its operating system + a self-owned mobile phone. With a view to commercial strategy, the separation of self-owned brand from mainstream operating system could ward off benefit conflicts to the partner for custom-made mobile phone arising from own brand; with a view to business development, the separation of custom-made system from own brand could efficiently bring Microsoft’s advantage in software development and user service into full play. OEMs will be more strictly requested for Windows Phone 7 mobile phone, so as to lower divergence on appearance and style and focus on the interfaces of operating system and software. Several functional “hub” modules, namely, Phone, Office, Text, People, Games and Marketplace, etc are provided with concise “function blocks”. Though there is not enough information on Kin at the moment, we can find that Kin follows totally different route from WP7 mobile phone, which lays emphasis on fashionable looking as well as entertainment services highly wed with Xbox, Zune and Facebook.
The smartphone terminal featured with personal life is developed towards software, services and user experience rather than performance, hardware and appearance. Microsoft’s portfolio of WP7+Kin covers a lot of user services relevant to software and Internet business, which could be deemed as a platform integrated with the operating system, Live, Xbox and Bing, etc. Although it is a bit late, smartphone undoubtedly makes up for the last and most important link in Microsoft’s huge business chain. In a word, Microsoft’s smartphone embodies its brand-new development strategy in the post-software era. Strategy I is oriented to software service and user experience, which greatly reflects Microsoft’s actual strength in the design of software system, user experience interface and information service. Also, Microsoft attempts to join by virtue of its core platform of mobile operating system as well as excellent one-stop experience on software, hardware and service. Strategy II is oriented to open platform but closed custom-made mode. WP7 manifests Microsoft’s open strategy on the integration of the core operating system and platform business, so as to achieve upmost enhancement on user value under the context of booming ecological environment of industrial chain; while Kin manifests Microsoft’s tradition in design and custom-made mode. Thus, tailor-made mobiles phones and services featured with more original style of Microsoft are appreciated by its most faithful consumers.
In the future market of smartphone, appearance and performance are not the only indexes any longer, because smartphone’s individuality and life property indicate that the mix of service and user experience will be one of the most decisive indexes in the next stage. If Microsoft could make full advantage as branded software and service provider and satisfy the development trend and cooperative strategy of intelligent terminal in the new era, is there any doubt that Microsoft could catch up with and surpass the current smartphone field? Let’s wait and see.
Author: Chen Yangbo, Researcher, Marketing Research Services, Sinotrust Shanghai Branch
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