A Verizon Wireless Deal May Help Microsoft's Mobile Position
April 28 2009 - 3:18PM
Dow Jones News
Verizon Wireless could give Microsoft Corp. (MSFT) and the
software giant's Windows Mobile platform a badly needed shot in the
arm.
According to The Wall Street Journal, the two are in talks to
launch a smartphone codenamed "Pink." Verizon Wireless gets yet
another potential signature phone to fend off iPhone defectors.
More importantly, Microsoft gains a high-profile ally in pushing
its operating system, which many deem dependable but
unexciting.
Indeed, Windows Mobile is feeling the heat. Many of its major
partners are shifting their focus towards rival Google Inc.'s
(GOOG) free Android platform, while Apple Inc.'s (AAPL) iPhone and
Research in Motion Ltd.'s (RIMM) Blackberry line continue to take
market share.
Verizon Wireless - which has a base of 86.2 million wireless
customers thanks to its acquisition of Alltel - brings the heft and
credibility needed to restore Microsoft's profile in the
industry.
To be sure, Microsoft hasn't been asleep at the wheel. It sold
20 million Windows Mobile devices las year.
But more recently, things have turned away from Microsoft.
Struggling Motorola Inc. (MOT) had all but shut off any resources
to developing Windows Mobile phones, instead focusing on Android.
Samsung Electronics Co. (005930.SE) unveiled its first Android
phone. Palm Inc.'s (PALM) Pre and Web OS platform have siphoned off
any buzz that hadn't gone to the iPhone.
Having a signature Verizon Wireless cellphone using Microsoft
software could provide upside if it taps into the carrier's large
base. If Microsoft puts more work into the operating system, and
the signature device sells well, it could be used as a standard
bearer to call back disenfranchised partners.
Microsoft is already showing some progress. During the last
wireless industry confab earlier this month, unit head Robbie Bach
showed off a new version of its mobile browser, which looked
impressive.
Still, challenges remain. The iPhone remains a dominant force.
Verizon Wireless has positioned several devices, most recently the
Blackberry Storm, as iPhone killers, but none of the devices has
been as successful. There's no guarantee a souped-up
Microsoft-powered device will dent that momentum.
Microsoft declined to comment on the potential Verizon Wireless
partnership, maintaining that its strategy to provide software
hasn't changed. Microsoft denied having an "iPhone strategy."
Spokesmen for Apple, Verizon Wireless and AT&T declined to
comment as well.
-By Roger Cheng, Dow Jones Newswires; 201-938-2020;
roger.cheng@dowjones.com