Here’s what has been happening with Microsoft in mobile.
Microsoft buys Skype
Microsoft has announced its intention to purchase Skype for $8.5B. The deal will likely take until Q4 of this year to close. Skype will become a business unit of Microsoft with its current CEO, Tony Bates, reporting to Steve Ballmer.
My Take: The question many are asking is wouldn’t it have been cheaper for Microsoft to build its own system instead of paying $8.5B for Skype? Surely they could have done it for well less than $1B. Microsoft argues that there is synergy with Skype and many Microsoft products. The two that quickly come to mind are Kinect enabled XBox 360s and Windows Phone devices. Buying Skype may get the tech to market more quickly and keep Skype’s technology out of competitor’s hands.
I think that Skype’s communication technology is a good thing for Microsoft, but Microsoft should have realized this a long time ago. They could have bought Skype for a whole lot less or just built the technology in house. This is more evidence of lack of vision in Microsoft’s leadership.
The two big fears are Microsoft cutting off access to Skype to non-Windows platforms and (more likely) Microsoft screwing up Skype and driving it into the ground (a la Danger). I don’t think either is likely, but I have learned not to underestimate Steve Ballmer.
Announcement of “Mango”
On May 24, Microsoft will host an event to preview “Mango”, or Windows Phone 7.5. (See here and here). We know that Mango will address some of the key features missing in WP7. Specifically, Mango will:
- Support multitasking, although we don’t know if it is “real” or Apple style
- Include an IE9 compatible browser, that also supports HTML5
Features rumored to be added include
- Better Bing maps with turn by turn navigation
- Windows Live Messenger support
- Bing Audio which will have Shazam-like music recognition capabilities
It will be interesting to see if any Skype integration is announced.
My Take: These are all much needed features for Windows Phone to help it be competitive with iOS and Android. However, by time Mango ships iOS 5 will be out as will Android “Ice Cream Sandwich.” How well will Mango compete with those modern mobile OSes?
Microsoft still needs to get developer support to supply the apps to get consumers interested in the platform (e.g. Angry Birds). Many pundits have already written off Windows Phone (such as InfoWorld’s Galen Gruman) but I think that’s a bit premature. The Nokia deal will give WP7 a huge boost in 2012. And Gartner has predicted WP to be more widely used than Android by 2015. There isn’t room for too many players in the smartphone OS game, but Microsoft is well positioned to be one of them with its modern OS and ecosystem.