Microsoft’s Windows Phone 8 software will soon be released on Nokia’s forthcoming Lumia devices, but the software giant may be creating mobile hardware of its own. According to a report from China Times, the Redmond, Wash.-based company has been working on a smartphone for the past four months.
This alleged Microsoft gadget would make its debut in the first half of 2013, although it is tough to say if this rumor is credible. This would put Microsoft in direct competition with the manufacturer of its flagship Windows Phone 8 devices, Nokia.
Despite the China Times report, some observers do not expect Microsoft to release its own Windows Phone 8 variant any time soon. The launch of a Microsoft phone would be a desperate and foolish step, IHS analyst Ian Fogg said.
“For the Windows Phone 8 launch this autumn, Microsoft is rightly relying on its strong mobile partners and their hardware and channel expertise,” Fogg told TechCrunch. “If Microsoft were to make its own Windows Phone device without working through partners, it would be a last-resort strategy. That would risk driving its current partners away.”
One factor working against a Microsoft-branded Windows Phone 8 is the timing. If Microsoft were to launch its own smartphone, it would make more sense to do so after its Surface tablet has had time to gain traction in the market. The company could work off the reputation of its tablet, provided it is successful, advertising the smartphone in its likeness.
“If Microsoft already had some success in the tablet market — e.g. with Surface — and already had gathered quite a user base, then having a smartphone probably could make some sense,” Garnet analyst Roberta Cozza told TechCrunch. “But I don’t see now how Microsoft, in a business like smartphones — where already more established device players are struggling — how the Microsoft brand could really make that connection.”
The last time Microsoft self-branded a smartphone was with the Kin and the Kin 2 in 2010, which turned out to be failures. Just weeks after its release in the U.S., Microsoft canceled the product’s launch in Europe that was set to take place later that year.
“We have made the decision to focus exclusively on Windows Phone 7 and we will not ship KIN in Europe this fall as planned,” Microsoft said in a statement from June 2010.
Furthermore, the situation with competing original equipment manufacturers could create some difficulty in the smartphone space. The announcement of the Surface tablet was enough to bother Acer CEO J.T. Wang, who had some choice words for Microsoft in August:
“Think twice. It will create a huge negative impact for the ecosystem, and other brands may take a negative reaction. It’s not something you are good at, so please think twice,” Wang warned via to the Financial Times.
Put simply, Microsoft does not need to compete with its hardware partners in the smartphone market because Nokia is already producing a flagship Windows Phone 8 device.
“Nokia is making exactly the kind of innovative, well-designed, full-feathered handsets Microsoft wants for Windows Phone, taking advantage of all the software features,” Mary Branscombe of ZDNet writes.
The possibility of a software industry giant such as Microsoft transitioning into smartphone hardware could open the door for others to follow suit.
“If Microsoft decides to pull an Apple and become a vertical player, it’s going to push Google to do the same thing even faster,” writes Stefan Constantinescu of Android Authority.
Microsoft will be holding a press event in New York on Oct. 25 to introduce the world to Windows 8 — and will put the product on sale the next day. As for Windows Phone 8, the release date is expected to come in November.
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