Microsoft Predicts Huge Growth For Windows Mobile

Windows Mobile platform

The bold prediction comes as smartphone sales rise and other major players like BlackBerry maker Research In Motion (RIM), Apple and Palm continue to clamor for market share.

"Fifty percent growth is the minimum," Eddie Wu, Microsoft's managing director of OEM embedded devices for Asia, told Reuters during a press conference Microsoft held in Taipei Tuesday.

As it stands, Microsoft expects to sell 20 million Windows Mobile units in the 2008 fiscal year, which ends next month, a boom compared with the 11 million units of Windows Mobile software Microsoft sold in the fiscal year that ended June 2007. Wu said he expects Microsoft to see its mobile platform grow at least 50 percent annually over the next two years. "We're actually still seeing very good growth in markets like Europe and the United States," Wu told Reuters, adding that Windows Mobile's growth has been swiftest in Asia-Pacific, the Middle East, Brazil, Russia and India.

Wu's prediction is in line with the sharp increase in smartphone sales, which research firm Gartner says grew 52.5 percent in 2007 vs. 2006 and hit around 12 million overall units shipped last year. And that growth is expected to continue. Research firm In-Stat forecast that smartphone sales will grow more than 30 percent per year over the next five years, outpacing the overall cell phone market, which will only see single-digit growth. That same In-Stat report also notes that smartphone sales are starting to outpace sales of laptops.

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According to information from ABI Research, mobile phone sales in the first quarter of 2008 were up 13.7 percent over last year, beating out predictions with 289 million devices shipped. ABI predicted roughly 1.28 billion devices will be shipped this year.

Despite the growth of the smartphone market, Citigroup analyst Kevin Chang told Reuters that Microsoft's Windows Mobile still faces an uphill battle. Even 50 percent annual growth may not be enough for Microsoft to be a strong rival to the Symbian mobile operating system, which dominates in Europe and has begun trickling into the U.S.

"Even if Microsoft is growing at a rate of 50 percent to 60 percent, it doesn't mean they can gain that much share, since Microsoft and Apple's mobile operating system is still much smaller compared to the Symbian system," he said, later adding that Microsoft may get a leg up because it is one of the few mobile players offering a touch-screen platform. Touch-screen devices have become widely popular in the wake of the Apple iPhone and have sparked several device and platform makers to scramble to create their own.

But Steve Brumer, CEO and founder of Wireless Rain, a Suwanee, Ga.-based wireless IT and managed service provider, said Wu's plans for Windows Mobile may not be too far off base, especially in the U.S. market, which takes Symbian's European dominance out of the equation.

"I definitely see Windows Mobile winning," he said, adding that devices like the Samsung BlackJack, the Motorola Q and the HTC Touch Diamond are all based on Windows Mobile.

Brumer said that while BlackBerry sales will always be strong, Windows Mobile has the backing of a massive quantity of devices. What puts Windows Mobile ahead of the pack is two-fold: the familiarity of Windows itself and the ease of integrating with ActiveSync and Exchange Server for an enterprise mobility strategy, Brumer said.

"If you know how to get around a desktop, you know how to get around a Windows Mobile device," he said. "Fifty percent sounds high for worldwide and a little high for the U.S., but Windows Mobile is the safe bet. Windows Mobile is driving the licenses and will dominate the U.S. market for smartphones."