What Happened?
Ending months of speculation, Microsoft (NASDAQ: MSFT) announced yesterday that all software and support for handheld terminals and ruggedized devices will be managed by the Windows Embedded team. These device categories were previously addressed by both the Windows Embedded (a la CE/Compact) and Windows Mobile groups.
VDC’s View
This news comes on the heels of the relaunch, realignment, refocusing, and rebranding of what was the Windows Mobile platform and is now known as Window Phone 7.
WinMo’s self-professed strength had always been its integration with enterprise applications. However, following competitors RIM and Palm, Microsoft’s new phone offering is intended to appeal to consumers and third-party application developers.
Meanwhile, Microsoft also revved its Phone OS to a higher Windows baseline after having previously trailed its parent CE by a version. Although this type of a drastic change was certainly necessary to gain some ground in the eyes of consumers and buttress its overall market share, Microsoft’s clear deviation from its prior WinMo strategy could have had a significant affect on the overall health of its EDD business unit if it did not address its roadmap in supporting the use of WinMo 6.x in ruggedized devices by large customers like Intermec, Motorola, and Honeywell. In fact, VDC had previously estimated that in 2008 non-mobile phone devices represented approximately 20% of all the revenue generated from Windows Mobile.
Whereas the significant amount of internal investment made by these large customers will certainly drive sustained revenue streams from Windows Mobile 6.x under Windows Embedded’s leadership in the near-term, the long-term success of this product as an Embedded group offering will depend on the following:
- Continued development and support of Windows Mobile 6.x as a tangential offering; and/or
- Development of a standard, non-componentized solution for handheld devices; and/or
- Considerable support over coming years to migrate existing rugged/IA WinMo 6.x customers to a CE/Compact baseline; and/or
- A coordinated effort to enable the convergent evolution of these two platforms’ roadmaps, streamlining future development around a unified offering.
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