Microsoft's efforts to regain lost ground in the mobile phone business will see the company offering two different versions of its operating system next year.
The company will continue to broadly sell Windows Mobile 6.5 to a large variety of handset makers, while working more closely with several handset makers to sell phones built on a new version of Windows Mobile that has been several years in the making, according to a source familiar with the company's plans.
While Windows Mobile 6.5 is a fairly interim update to the mobile operating system that Microsoft has been selling, Microsoft has also been working on more radical efforts to overhaul the operating system. Both its plans for Windows Mobile 7 and its long-running "Pink" project aim to match the kinds of experiences seen on the iPhone and Android, using more advanced voice and touch interfaces and higher-end hardware.
Microsoft demonstrated Windows Mobile 6.5 at the GSMA Mobile World Congress in Barcelona. That interim update to Windows Mobile will start arriving on phones this fall, while a more radical overhaul of Redmond's cell phone OS is due next year.
(Credit: Marguerite Reardon/CNET News)A Digitimes report this week called the effort a "dual-platform" strategy, although I'm not sure I'd use that term to describe two versions of Windows Mobile being sold at the same time.
What is clear is that Microsoft needs to do something serious if it hopes to live up to its mobile ambitions. For years now, the company has made rather modest updates to the Windows Mobile operating system, which dates back to the days of code powered PDAs and other organizers that were neither phones nor, in some cases, even connected to the Internet.
In that same time, Palm has gone back to the drawing board and reinvented itself with the WebOS-based Pre, while the iPhone and Android have entered the market and even Research In Motion has arguably done more to capture consumer interest than has Microsoft.
Internally, Redmond has shifted a number of its people into the mobile unit. In addition to former server executive Andy Lees, who now runs the phone business, former Mac Business unit chief Roz Ho has been leading a top secret "premium mobile experiences" team responsible for some of the "Pink" work. The company purchased Danger, known for creating the teen-centered T-Mobile Sidekick, and Ho heads that unit as well.
The software maker has also tapped folks from its Tellme unit to help bring improved voice recognition capability into Windows Mobile.
Call waiting
Microsoft has been working on Windows Mobile 7 for what now seems like an eternity, especially in the mobile world. The product was supposed to be in phone makers' hands by early this year, but has suffered a number of delays.
CARLSBAD, Calif.--Research In Motion didn't set out to make devices for the everyman, but that's where the company has ended up.
RIM CEO Mike Lazaridis, speaking at the D: All Things Digital event Wednesday in Carlsbad, Calif.
(Credit: Ina Fried/CNET)In a talk Wednesday at D: All Things Digital, CEO Mike Lazaridis talked about the company's move from making e-mail devices for executives, to making phones for the masses.
"We literally were pulled into the consumer space," he said. "We entered that market deliberately with the BlackBerry Pearl."
It's still a journey that is just beginning, he said, adding that the company has learned how intensely personal the phone is as compared to other gadgets.
The closer a technology gets to a person, the more it has to represent our values, our styles," he said. "It's not a one-size-fits-all (business)."
That the company didn't set out to be a consumer company doesn't mean it didn't see a big future for the BlackBerry, even in its early days as a black-and-white e-mail only device.
"We had to disguise these things as pagers," Lazaridis said. "We always knew this was a new platform, that this was something special."
Lazaridis wouldn't talk much about the next version of the company's touchscreen Storm device. He did downplay the notion of a BlackBerry tablet.
"Is it as convenient?" he said. "Would you carry it around if you couldn't put it in your pocket?"
Lazaridis said that the slowing of cellular networks due to smartphone usage was the "white elephant in the room."
"We're already seeing this slowdown in the networks. that's already happening."
With shares of Research In Motion among those that have seen a massive drop in recent months, Reuters on Friday made the case that the company could make a juicy acquisition target for Microsoft.
There are several reasons that could lead one to that conclusion. RIM is strong in the corporate phone arena, the area of most interest for Microsoft. Microsoft's OS has had trouble keeping pace feature-wise and its next version, Windows Mobile 7, is running quite late. And, of course, the RIM shares that were trading near $150 a few months ago are now at around $53.
That said, I'm not seeing it. The company already has too many mobile operating systems. Microsoft has already scooped up Danger, which uses its own operating system for the T-Mobile Sidekick.
As longtime analyst Michael Gartenberg notes, Microsoft already has a strong product for taking corporate mail onto phones and buying RIM would put the company further in the device-making business.
Plus, even with the recent drop in RIM's shares, the company is still valued at north of $30 billion. For that price, Microsoft could afford to offer Yahoo nearly twice its current value. And Microsoft's online business is hurting for market share way more than the mobile unit.
Anyway, that's my take. What do you think? Sound off in the comments section or drop me a note.
Microsoft and Research In Motion are expected to announce on Thursday a partnership that will make it easier for BlackBerry users to reach Microsoft's search engine, according to a source familiar with the companies' plans.
As part of the deal, BlackBerry users will have the option to use Microsoft Live Search as their search engine of choice within the device's browser. Also, Microsoft's Live Search will be an option from within RIM's mobile portal.
Although Microsoft competes with RIM for business phone customers, it has also worked to get some of its products onto its rival's devices. In one case, Microsoft even debuted a service first for BlackBerry--that being Tellme's voice-to-screen search feature on the BlackBerry.
Microsoft announced a deal with RIM back in May to get its Windows Live Messenger and Windows Live Hotmail onto the BlackBerry.
Update: RIM officially announced the deal on Thursday, along with several other consumer partnerships including one with TiVo and another with MySpace.
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