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Brand=Status | Can Microsoft learn from Apple?

While Apple doesn’t really care about the price a consumer is willing to pay for its superb products, the Microsoft/Nokia partnership is taking a different tact. Starting in January, 2012, the Nokia 710 fully loaded with Windows Mobile 7.5 (Mango) will start selling on the T-Mobile network for less than fifty bucks. Which one is a better tactic can be debated (honestly, our money is on Apple). Android, of course has done a superb job of capturing the market by offering their OS to various manufacturers (Samsung, LG, Motorola, etc.)

If you are old enough, you will remember when Windows 95 was released. Lines stretched for blocks and every copy was sold out. Apple fans were highly irritated that an inferior OS (debatable) was getting all the attention. Well…the tables have turned now! In mobile, Apple is now the golden child, and Microsoft is on the sidelines. Google has made inroads quickly to challenge the golden child as Microsoft has struggled. Here are a few salient points:

  • Consumers are used to spending a few hundred bucks for smartphones by now. Apple wants their products to be coveted by everyone upgrading from feature phones (aka dumb phones) to smartphones.
  • We all know that loyalty for Apple products runs high. Since not a whole lot of folks switch away from Apple, they are confident that every 18 to 24 months, people will upgrade to the latest and greatest Apple phone (no matter the cost). The migration from Android to Apple is higher than the migration from Apple to Android. Poor Microsoft is just a spectator (yet).
  • Nokia’s fifty dollar Lumina 710 is content in targeting folks using dumb phones upgrading to smartphones at a reasonable price. So far, everything Nokia has done to capture a decent share of the smartphone market has failed. Internationally though, Nokia may be on to something. There are parts of India where the Nokia brand runs deep. Some even call a cell phone “Nokia” (kinda like a tissue is called “Kleenex”). India has a huge untapped mobile market; and Nokia is well positioned to explode its smartphone offering.
  • Google’s Android doesn’t care for media-blitzes or stunts (e.g. a six-story Windows Phone in NYC). Instead, they concentrate on flooding the market with Android-powered devices. If you walk into Best Buy, you’ll see 50+ Android phones versus 2 iPhones. Windows Mobile is starting to catch on with a dozen or so phones now.
  • Brand = Status. Apple is THE BRAND in mobile phones. How did Apple created it? Just see their TV and print ads, feel their products, experience their stores, interact with their staff; and then hear what their fans have to say! Loyalty runs deep. Remember Steve Jobs’ famous quote, “It’s not the consumers’ job to know what they want.” The man built products with no focus groups, no consumer feedback – it was based on his understanding of pop culture and technology. When you marry this with Mr. Jobs’ intuition, you get incredible results!

Back to Nokia / Microsoft. It is (almost) pitiful to see a giant like Microsoft struggle so much. The Windows Mobile 7.5 (Mango) OS is decent. Even Forrester and Gartner are predicting a 20% to 25% marketshare for Microsoft Windows Mobile over the next 2-3 years. At their rate, we remain skeptical (but we sincerely hope that our skepticism is short-lived). For now, it’s iOS versus Android. Oh, I guess we should mention BB and RIM. Na….


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