What Microsoft Doesn't Get About Smartphones

In a new post on the Windows Blog, Microsoft (MSFT) Senior Director Paul Bryan spends 1,200 words explaining why Windows Phone 7 will be great for business. But Bryan betrays Microsoft's fundamental lack of foresight by the second paragraph, and his error foreshadows what will sadly be the mediocrity of Redmond's once-promising new mobile initiative.

Not that Windows Phone 7 will be bad -- no, actually, in a vacuum it would be an excellent (even beautiful) mobile OS. But Bryan's insights make its direction look feckless and uninformed, as if the company is stuck in years past and can't seem to take a shortcut to 2010. Bryan's post reads in part:

By adding Windows Phone 7 to our portfolio, Microsoft is well positioned to address the needs of customers with active personal and business lives who desire a single device that delivers rich end-to-end experiences and navigates seamlessly between work and play. Demand for Smartphones that play as hard as they work is fueling the continued growth for new devices, with IDC projecting 31% growth in Smartphone units in 2010 and another 22% in 2011.

The idea of customers that "desire a single device that delivers rich end-to-end experiences" was definitely true back when Apple (AAPL) delivered the iPhone right on time in 2007.

But these days, consumers are buying iPads in droves, while others are waiting for a competing device from Google (GOOG). Still others are waiting excitedly for smart TVs that can begin to bring some of the best features of Internet media to their living room screens. Meanwhile, PC makers are realizing that the growing litany of portable devices is redefining what people want from their desktops and laptops. In other words: no one wants a single device for anything anymore. Consumers instead are developing an increasing appetite for an ecosystem of cheaper, smarter devices that fit with the various tasks they do most often.

This fundamentally changes the position of the smartphone. When you have things like a tablet and a smart TV, they put boundaries on the use-case scenarios that involve your phone; you're less likely, for instance, to want to watch movies on your small-screen device when a slightly bigger one like the iPad is available. And when you have stellar office apps on your iPad you're not as enthused to edit documents on your phone -- in fact, you might start to pine for a smaller, simpler, lighter and cheaper smartphone that shunts most of the work to its bigger-screened cousins.

Yes, smartphone sales are growing -- but nebulous statistics are no basis for product development. Just because people are ditching their carriers' awful, free dumbphones doesn't mean they automatically want a big-screened mobile workstation. In fact, late adopters might be better served by one of those pared down smartphones I referenced earlier.

Users may indeed want something that can straddle work and play, and Microsoft has all the elements in place: Windows Media Center for television integration and Xbox for video games. But if the company wants to head off Apple and Google, which have a substantive lead, it will have to begin re-evaluating what its best products are actually good for. (The stellar Bing Maps I've argued could be a major selling point for Microsoft's TV project.)

Making a do-it-all phone just isn't going to cut it.