Microsoft's Phone is CallingMicrosoft's Phone is Calling

The circling vultures around Redmond will have to settle for Kin scraps. I think Microsoft has finally become serious again. Game on.

There are few things in life which elicit more affection and devotion than the smartphone. Mobile phones matter. They matter more than anything else Apple, Google, or Microsoft does. There is no other product or service that will dictate, shape, and enable work and work flow over the next ten years. We aren't even at halftime yet in this smartphone game.

That’s why it;s a good thing Microsoft decided to re-enter the field after its earlier pummeling. Microsoft knew, even shaped the earlier smartphone market...all the way up until Apple launched the iPhone. Pre-iPhone, Microsoft’s phone was available on every major carrier in the US and abroad. Microsoft's partners included the finest hardware brands and carriers globally. The company was in the process if catching-up to RIM, who had proved email on a cell phone was indeed possible and desirable.

Its success with Windows Mobile 6.5 and earlier was based on low expectations. These smart phones were basically phones that could process email with limited app capabilities. The Windows part was bolted-on to a phone.

Microsoft’s meager head-start advantage in smartphones evaporated quickly. The iPhone changed the rules. Before the iPhone, carriers made vendors create mediocre devices that offered email with network protection in mind. No device vendor could upset the carriers who sold and supported smartphones. Apple had nothing to lose, so demanded product control and in return for this control traded exclusivity. The iPhone showed what a wireless phone could really do (and that it could also stress-test a network).

The iPhone and Google's Android are now the darlings of the smartphone market--impressive sales, high loyalty, and increasing capabilities. Apple broke the mold, and now Android and Apple together are both pushing the realm of possibilities. Neither of which supported Exchange in its first release, both do now. Neither phone was marketed to IT managers, but both are penetrating the enterprise.

Now Microsoft is back with a vengeance, and intends to break-up the duopoly with new forms of innovation. But can Microsoft pull it off? The company missed the bulls-eye on several events of late. In addition to the smartphone, its Zune lacks muscle. Microsoft exacerbated its Vista failure by insisting it wasn’t a failure. Just in the past few months it gave up on the Kin and its Live Spaces blogging site. Prior to this year, Microsoft gave up on its efforts with ResponsePoint, Encarta, FrontPage, Truspace, Live Search Books, and the OneCare Security Suite--all gone. Its ballyhooed SilverLight remains a curiosity.

The faults weren't in the categories or the economy. In all of those cases, other firms were successful with these product/service categories. Giants were born. Google blossomed on search. Twitter and Facebook on social (hello MSN?). Amazon, Google and many others are offering non Microsoft infrastructure in compelling data center services. Apple made inroads into Microsoft’s desktop share, Chrome and Firefox steal share from IE. Apple re-invented the tablet. Alternatives for Exchange and Office have never been greater.

But actually, I sense a shift and Windows Phone 7 should not be dismissed. The hot tech topics and Microsoft’s news are once again aligning. Microsoft is addressing new products with far more zeal than before. Whoever was asleep at the switch seems to have woken.

Vista is a distant memory, and Windows 7 is a success. Microsoft continues to get serious about the cloud--billions serious. A far cry from a few years ago when its channel was excluded from BPOS. Bing is gaining traction, and IE9 is getting great reviews. The new Microsoft Windows Phone 7 is a serious device, launching with over 10 devices in 30 countries. Microsoft’s products are benefiting from a leaner and more humble organization.

Lync 2010 will be Microsoft's first serious attempt at enterprise unified communications. The company intends to deliver a fairly comprehensive solution. I've been critical of OCS in the past--I just felt that certain features like phones and call park were basic telephony rights. But Microsoft is taking a more comprehensive approach with its third release (the MS magical release) planned still for this year.

Lync will be hitting the market strong. A cadre of partners for gateways and carriers, three vendors for phones (Aastra, Polycom, and now Snom), and a network of UC tools and solutions. The near-term challenge will be incorporating the solution into its mobile and cloud strategies--which won't be easy as the paint is still drying on those facades. However, Microsoft is building the components of a powerful framework--one that potentially could eclipse the competition. Something that seems more likely today than the impossibility it appeared just a year ago.

Does the world need a new mobile phone? Surprisingly, quite possibly. The market continues to to grow unabated. The rate of innovation with Apple and Android are amazing, yet the perfect phone remains elusive. Both of those devices are largely being driven into the enterprise by user demand, but an enterprise grade solution hasn’t been presented to the market yet. Certainly demand for wireless devices continues unabated, but many organizations continue to rely upon WinMo and RIM due to the alternatives leaving specific requirements unfulfilled.

Increased mobile phone competition benefits us users that are still paying too much and making too many compromises. The circling vultures around Redmond will have to settle for Kin scraps. I think Microsoft has finally become serious again. Game on.

Dave Michels, principal of Verge1 blogs about telecom at www.pindropsoup.com