Motorola: Windows Mobile 7 Coming in 2010
Motorola had an earnings conference call today with some juicy tidbits embedded in it. Primarily, Moto confirmed that they're losing tons of money and that their handset business is not doing very well at all. So how are they going to turn it around?
Context & Ripple Effects
Motorola's confirmation that Windows Mobile 7 arrives in 2010 lands mid-crisis: the company is bleeding cash and has admitted its handset business is failing, following its January 2008 announcement of a structural and strategic realignment meant to restore shareholder value. The timing matters because Microsoft had already signaled the same roadmap — weeks later Ballmer publicly confirmed Windows Mobile 7 coming next year — making Motorola's bet on the platform a shared wager rather than a solo gamble.
First-order effects
- Motorola's handset division must now plan its recovery around an OS that won't ship until 2010, meaning at least another year of selling aging Windows Mobile and feature phones while losses mount.
- Investors get a concrete turnaround timeline attached to the earnings call, but also confirmation that near-term results will stay weak — setting up the Q1 shortfall when revenue came in short and handset units tumbled.
Second-order effects
- Waiting on Windows Mobile 7 leaves Motorola exposed to faster-moving rivals; by late 2009 the market had moved to Android, where Motorola's Droid launch raised the question of who needs Windows at all.
- Microsoft gains a marquee hardware backer for its next platform, but if partners like Motorola hedge toward Android, Windows Mobile's ecosystem leverage weakens ahead of the 2010 launch.
Third-order effects
- The episode illustrates how dependent struggling handset makers become on OS vendors' roadmaps — a dependency that pushed manufacturers toward Android's faster cadence and helped consolidate mobile around two platforms.
- If betting a turnaround on a future OS keeps failing, expect more forced structural breakups of handset businesses rather than product-cycle fixes.
The trend: This is one data point in the shift from carrier-and-licensee-era mobile software toward vertically integrated smartphone platforms that left hardware-first OEMs scrambling for relevance.