Microsoft Phone Sales A Disaster Until Now: Will Nokia Purchase Save Them?

Steve Ballmer,57, who is resigning as CEO of Microsoft, admitted his company reacted too slowly to developments in the mobile and smartphone markets, and that Microsoft phone sales were disappointing.

He was addressing a group of Wall Street investors and analysts, and told them that, with hindsight, he realized that the company had placed too much emphasis on its operating system and missed out on mobile phone opportunities.

But he went on to say that now the company has significant opportunities in the market, due to its recent acquisition of the mobile phone unit of Nokia. He believes that this move will allow it to speed up development on its Windows Phone platform.

Currently the market is dominated by Apple, with its iPhone and iPad, and Google’s Android platform which is used by many manufacturers such as Samsung and LG. Microsoft is way behind, and will have to pull something very special out of the bag if it is to make any significant impression.

Ballmer said, “I regret that there was a period in the early 2000s when we were so focused on what we had to do around Windows that we weren’t able to redeploy talent to the new device called the phone… That is the thing I regret the most. It would have been better for Windows and our success in other foreign factors.”

However, trying to view the situation from a “glass half full” basis, Mr Ballmer said that for Microsoft mobile the only way was up.

On Monday, Microsoft will reveal the second generation of its Surface tablet; the first Surface, released in October 2012, did not do well. Last July the company said it had written off $900 milion in unsold Surface stocks. At that time Ballmer admitted ruefully, “We built a few more devices than we could sell.”

There has been widespread speculation that it was this failure that accelerated Mr Ballmer’s departure from the company, which is due within 12 months. A successor has not yet been announced.

Whoever the successor may be, he – or she – will have the unenviable task of trying to ensure that the words “Microsoft phone” do not become a synonym for failure in the mobile market.