Why Windows Phone Failed – And How They Could’ve Saved It

Why Windows Phone Failed – And How They Could’ve Saved It


Windows Phone: a product with so much potential
that had everything going for it, and yet one that failed spectacularly. Despite the billions of dollars and the priceless
connections of Microsoft, the Windows Phone never took off and would go down in history
as one of Microsoft’s most expensive mistakes. In this video, we’re gonna look at the reasons
behind its failure and the actions Microsoft could’ve taken to possibly prevent it. This video is brought to you by Dashlane. Keep your passwords safe and strong across
all your devices by registering with the link in the description. When Steve Jobs announced the iPhone in 2007
he took the smartphone world by storm. Well, how do I scroll through my list of artists? How do I do this? I just take my finger and I scroll. Up until then, smartphones had a big problem:
they had small screens with interfaces that were hard to navigate, and the reason for
that was because half of the phone was occupied by a keyboard with tiny buttons you could
hardly press with any precision at all. What Steve Jobs showed to his extatic audience
was a game changer, but it wasn’t just Apple fans there were watching. The engineers at Google, which for the past
two years had been building a smartphone of their own, had to scrap their entire project
and to start over with a touchscreen design. Their final product, Android, would arrive
more than a year later, at which point the iPhone had taken the smartphone crown. The iPhone’s model was built on exclusivity:
it was entirely produced by Apple to establish maximal control over the user experience and
the quality of the product, which allowed Apple to charge a premium for their phones. To succeed Android would have to adopt a different
strategy: instead of going for exclusivity, Google tried to be everyone’s friend, partnering
up with as many phone manufacturers as possible with the selling point of their phones being
the fact that they were cheap, yet functional. For a time, the smartphone world was in balance,
with Android and the iPhone occupying very distinct segments of the market. And yet, this balance would soon be disturbed
by another tech giant, Microsoft. Now, out of the three companies, it was actually
Microsoft that had the most experience with mobile devices. Back in 1996 Bill Gates unveiled what he called
the handheld PC, which was really more of a tiny laptop. I’ve asked Tom McGill from the Windows CE
group to join me on stage and give us a quick glimpse of some of the neat things that are
built into the handheld PC. For those of you that might not have seen
one yet, Bill talked a little bit about the handheld PC and this happens to be the Casio
unit actually. The Casio unit is typical of the handheld
PC, so it’s got a physical keyboard, a 480×240 2 bit per pixel screen, IR, PC card, upgradeable
RAM, 2 AA batteries. So this is a pretty typical handheld PC. The operating system it ran was known as Windows
CE, which was basically Windows 3 modified to function on the lowest specifications possible. Over the next decade, Microsoft would add
features and develop this product line extensively, making another 6 full releases. Between 2006 and 2008 Microsoft’s mobile
devices claimed a 15% market share, greater than any of their competitors except Symbian
by Nokia. But this success is exactly what blinded Microsoft
to threat of the iPhone. When Steve Ballmer, the CEO of Microsoft at
the time was asked about the iPhone his reaction, well, let’s say it hasn’t aged very well. Steve let me ask you the iPhone and the Zune
if I may. Zune was getting some traction and Steve Jobs
goes to Macworld and he pulls out this iPhone. What was your first reaction when you saw
that? $500, fully subsidized with a plan! I said, ‘that is the most expensive phone
in the world’ and it doesn’t appeal to business customers because it doesn’t have a keyboard,
which makes it not a very good email machine. What’s even more priceless, however, is
the frankness of the next question. How do you compete with that though? He sucked out a lot of the spotlight in the
last few weeks because of what happened at Macworld, not only with the iPhone, but with
the new iPod. How do you compete with that, with the Zune? Right now, well, let’s take phones first. Right now we’re selling millions and millions
and millions of phones a year. Apple is selling zero phones a year. Notice the stark difference between the two
men: the reporter very clearly sees the innovations of the iPhone as a threat to the old smartphone
establishment, but Microsoft’s CEO can barely look past the sales numbers. And just in case you’re thinking he’s
an exception, the CEOs of Blackberry and Palm were equally skeptical of the new iPhone. It took Microsoft a full year of declining
market share to finally realize that something had to be done. Unlike Microsoft, Blackberry’s sales were
still increasing, which gave them a sense of confidence they never recovered from. Now as they say, it’s better late than never
and when Microsoft finally got around to it, their development was actually pretty fast. Microsoft began developing a touchscreen based
mobile device in late 2008 and it took them only two years to get it ready for market. What Steve Ballmer unveiled was indeed a very
unique product whose advancement of smartphone design isn’t really widely recognized, but
it should be. At a time when the iPhone and Android were
stuck with static icons, the Windows Phone gave you tiles with live information. Overall, critics had much to praise: in terms
of design the Windows Phone user experience was right up there next to Apple and because
Microsoft had very strict requirements for the hardware used by phone manufacturers,
all of the early Windows Phones were very powerful machines for their time. And yet, Microsoft ran into a big problem
very early on. You see, Microsoft was trying to do something
very difficult: it was emulating Apple in trying to establish strict control over the
user experience and hardware, but unlike Apple it wasn’t actually making its own phones. This approach made the Windows Phone a very
refined product, but the degree of control Microsoft wanted made working with them much
more difficult for phone manufacturers compared to working with Android. Unsurprisingly, most phone manufacturers decided
to partner up with Google, which left Microsoft in a very bad position: it had a great product
and no one to make it. The only saving grace for Microsoft was a
lucky connection: when Nokia replaced their CEO in September 2010, the new guy, Stephen
Elop, was a former Microsoft executive and the first item on his agenda was to try to
restore Nokia’s declining market share by abandoning Symbian and pivoting towards Windows
Phone. Now, you can tell that this was a very premeditated
plan because this massive transition, during which Nokia completely changed their product
offerings, happened in the span of a single year. Nokia started selling their first Windows
Phone in November 2011 and I can tell you right away that this was possible thanks to
the billions of dollars Microsoft poured into Nokia as “platform support payments”. Nokia was supposedly paying Microsoft a licensing
fee, but in reality it was actually getting $250 million back from Microsoft every quarter,
which more than made up for their expenses. Of course, the other phone manufacturers knew
that this was happening, which pushed them even farther away from Microsoft. After all, why would they fund their own development
and pay a licensing fee to Microsoft, when Nokia was getting it all for free? Effectively, Microsoft had gone all in with
Nokia and there was no going back. But sadly for Microsoft, it was far too late. By the time Microsoft solved its production
issue, four years after the introduction of the iPhone, it had fallen to a 2% market share. Nobody was developing applications for the
Windows Phone and why would they, considering that Android and iOS were clearly the winners
here. For its first three years, the Windows Phone
App Store was empty: it didn’t have Instagram, it didn’t have YouTube, it barely had anything. By 2013 the stock price of Nokia had fallen
by 75% at which point angry shareholders were threatening to just fire Stephen Elop and
get rid of Microsoft altogether. In the end, that didn’t happen: Microsoft
instead just purchased Nokia’s mobile phone division for $7.2 billion in 2014. Here’s the funny thing though: the very
next year Microsoft wrote off their investment for $7.6 billion, and then to top things off
they fired almost 8,000 employees. Microsoft kept Windows Phone on life support
until October 2017, but it was clearly dead a long time before that. And yet, it’s easy to imagine the different
path Windows Phone could’ve taken had it only not been as greedy with its original
philosophy. Had Microsoft been willing to compromise on
its control over production, it would’ve easily convinced the big manufacturers to
use Windows Phone instead of Android. After all back then Google had practically
no ecosystem to speak of, while Microsoft had been a software titan for decades. There’s a lesson to be learned here about
the importance of compromising in business, but there’s one sphere in life where you
shouldn’t compromise and that is keeping all your passwords secure. Luckily for you, with Dashlane managing your
passwords is a breeze. Dashlane can generate strong passwords and
can store them safely across all of your devices, automatically filling them in when you need
them. Dashlane is available on every popular desktop
and mobile device, and it would’ve even been available on Windows Phone if Microsoft
hadn’t screwed it up. On top of managing your passwords, Dashlane
also offers a VPN for every one of your devices, and it also monitors the Dark Web to make
sure your data hasn’t been leaked by hackers. You’re probably catching my drift here,
but Dashlane really is great. So great, in fact, that I’m gonna give you
a free trial of Dashlane and 10% off their premium service if register using the link
in the description. Use the code ‘businesscasual’ to get the
discount. Anyway, thank you for watching. Make sure to like, subscribe, leave a comment,
check out both my Skillshare classes (I just released a new one) and we’re gonna be seeing
each other again in two weeks. Until then: stay smart.

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About the Author: Oren Garnes

100 Comments

  1. I was extremely shocked at how much Windows Phone sucks. One of my first exclamations was that it seems like Microsoft forgot how to make computers if you went by the Windows Phone alone. Or that Microsoft never knew how to do technology.

    Phone service side of it is not problem. But, lack of Software and apps is definitely a killer for me.

  2. To think Nokia could still be one of the top phone manufacturers, screw the CEO for some reason staying with MCsoft.

  3. I remember very clearly in 2007 when I got one of the very first iPhones. Almost ALL the geeks on the tech boards were very skeptical. I was using the phone and thinking "This thing is like a Tri-corder compared to th hundreds of phone gizmos out there. It blows everything out of the water, and nobody can see it!"

  4. Still, till today, Windows phone is the BEST OS. T H E B E S T….Full stop. I have a Samsung Galaxy S10+ and, yes, the hardware is impeccable, but Android is rubbish. I still also use my HP Elite X3, 950xl and 950 and still prefer these.

  5. i used the nokia lumia 520 for a year it was good at that time but apps were very less and apps like instagram werent available at that time

  6. I've got a lumia 920, 930 in my drawer at home. So unlucky, that a product and idea with a good potential wasn't growned up ;/ But still – I love lumia for those best at their time Cameras and Zeiss lenses and as 1 at all smartphones – manual mode. Maybe i'll spend some money and buy one lumia 1520 or 1020 just only for make my dream come true :d

  7. I had a Nokia Lumia phone with Windows OS. Decent phone for the price, nice OS layout. Lack of apps and some bugs is what did it for me. When playing music stored on the MicroSD card, either I could play it or not. The phone would still see the memory card, but sometimes the software wouldn't see the music.

  8. I just bought a Nokia Lumia 640 from ebay for £18.99 in A grade condition.
    mostly just use it for emulation after I flashed Linux onto it.

  9. I own Nokia 950 wp, great phone still, great camera, but MS screwing it up by not supporting it's applications.
    Latest is Facebook, few months ago MS dropped it. No more support, don't work anymore, only through browser.
    I owned Nokia 1020, great phone, great 42 Mpx camera, it started with no more support for Skype, crazy, MS owns Skype.

  10. Can Microsoft re-enter the game today using Surface design language and quality?

    Imagine having Sufrace laptop, surface go and Surface phone. This could be an "echo system" which google lacks.

    For Apps, porting in android apps in the beginning shouldn't be impossible.

  11. Microsoft should work hard on this system and lunch a new one sucssfully even that takes years of work,test it hardly and take care about android system and google apps and other famous apps updates every ones keep watching and develop your system and work with phone companies
    Microsoft can sucss in this case.

  12. The mistake Jobs made initially with his OS in favour of MS, Gates made a few years later with his MS smartphone OS, allowing Apple and Google to reap the rewards.

  13. Er no you could tell if you owned one Microsoft phone was a horrible ugly looking platform and needed to disappear.

  14. If we go back to the original Windows Mobile, the issue was a lack of effort to continue development even after the iphone was released. If we go to a more current Windows Phone – they only released it on the crap to mediocre phone hardware (smaller screens than the competition, weak processors, smaller batteries, thicker phones). The Nokia fiasco was rediculous. A big reason people buy new phones is to get better HARDWARE. iphone would still only be available on crappy little screens if Samsung hadn't bitch slapped them when they released phones with big honkin' screens. Charging for the OS made zero sense when android which was more popular was free. They could have charged if they eventually took market share. Ballmer was a technological fool and did more damage to MS's reputation than Jobs.

  15. 0:57 ERM POINT OF CORRECTION !!

    there were touchscreen phones before the iPhone !! eg. the LG Prada came a year before ! as usual No1 paid attention till Apple unveils "something new" which isn't new and has been done before by other OEMs but somehow Apple ALWAYS somehow (by hypnotism perhaps lol) gets all the credit ! smfh this world ey.

    It is said that Apple might have been "inspired" by a Nokia device from 2002 (that didn't come out to the masses) that even looked like how the 1st iPhone had been designed on.

    S. Jobs just makes this grand appearance on a huge stage & bam people loose their minds like they've never heard or seen a touchscreen device (if not even a phone) before. sigh. people actually fall for such # theatrics. Steve might have been the Best Illusionist & Marketer ; ReBrand-er to have ever Lived ! That I'll Give him 👏

  16. Good video though

    Microsoft are real a*holes for ruining Nokia.

    some say they did so because of Nokia's possible MeeGo crossplatform OS which could have posed a threat to windows running on Desktop and Laptops.

    such a shame.

  17. I had one for 3 years… the reason for its failure was the lack of apps.. it was independent from apple or android, if Microsoft would’ve included a Android store or apple store then I would’ve kept it

  18. i had a nokia lumia 925 for about 2years, i really loved the UI of windows phone, but the lack of apps was a big issue for me. could've compete in todays market if microsoft wasnt that greedy.

  19. And still everyone says Apple invented the touch screen phone with no keyboard. HTC released the Touch 3 weeks before iPhone, with Windows mobile 6. Apple has been a corporate thief from day one and should be disbanded and the owners jailed

  20. The best part of windows phone was the active tiles. You could customize the look, even make them transparent to allow the wallpaper to show through. You could completely customize your home screen. That kind of customization is not possible with ios or android.

  21. Windows Phone was so cool, fast and worked perfectly. The only problem were the apps, you want to download X and you can't, you want to download Y and you can't

  22. All these talk here and there. WINDOWS PHONE WERE UGLY simple and straight…. Stupid tiles and finding where things were was hectic. Had nothing outstanding….Some rich guys or big dude also have no brains to know what is cool and what is not……the looks first before anything else but many just dont get it….

  23. Not to mention the huge fan base they had, which they disappointed by promising their phones would be updated to the next system updated, while they did not. All fans who spent month supporting Windows by giving their feedback just stopped believing it Windows Phone

  24. 2 things to say

    1. I loved my Lumia, stopped using it once Microsoft scraped project Astoria
    2. Steve Ballmer was an idiot

  25. I have a friend who swore by Nokia & Windows phone os. Used to laugh at us Androiders. He now uses a 6.3 inch Samsung with Android Pie.

  26. Also, when they announced WP8, WP7 users were really disappointed by the fact that their phones cannot be updated to WP8. MS lost tons of users bcz of that as well while they were struggling in the market and desperate for more users.

  27. It's said that one of the characteristics of an enterprenuer is being a "risk taker", well that's what Microsoft did but it didn't work well for them for it was an expensive and dump risk.

  28. Simply putting more effort in it, also release more phones and more frequently like other brands with lots commercials and paid reviews, and MS did non of that.

  29. Since the windows is released in htc phones I was using until then 2015, Samsung Omnia w was one of the best though, the user experience is much better compared with ios and android, then app store came into the picture…. R.I.P Windows phone.

  30. Windows monopoly PC, If Windows use the monopoly on PC to push Windows Mobile, it can survive , Sometimes you need to play dirty, if you don't , they will

  31. The experience they had before the others – that is the real killer. They threw out of the window all the devs who put a lot of their time into Windows CE and its derivatives (through the years – Windows mobile, Windows smartphone, Pocket PC, handheld pc etc.). The "new" windows phone started as locked to silverlight (limited .NET) toy. The dev base they had till that moment was more hard core – Windows CE had APIs compatible with the desktop, there were differences here and there, but it was a good old style OS letting you do everything in a native manner, use any language, devise new ideas at almost any level. Then suddenly you are limited to this?! Funnily enough up to about 2012 (arbitrary number) there were more applications for the old abandoned platform than for the new one and most of them were simply impossible to implement on the new Windows phone even after its move out of the silverlight idiocy. They had some objective problems, the carriers were stubborn and how Steve Jobs managed to get through is still a mystery for me, but they had so much power not only in the form of resources, but also in the form of developers and quality of the OS that the only thing they needed to do was to not abandon them. The new UI was possible as shell over the old one, but they decided to forbid this. Recently I showed my colleagues devices from the last years of the old (not tiled) times and they were surprised to see that they are so agile – devices from 2008/2009 with customized UIs from HTC and open source ones, performing comparably to today middle rangers – just imagine what opportunity we lost. That OS was very open and multipurpose, low level programming was a breeze, the graphics and UI available for any kind of software (compare with Android if you know how it is) and yet (Microsoft) they started to claim their own product needed "upgrade" for something that it demonstratively is still capable of doing well even today. And worse of all, they are still trying to force us to use the failed technology and philosophy somehow. I think it is important to know this for everyone who is into the computing in general. Without understanding we will be continuously shown "new" stuff which is actually trying to achieve something that was achieved naturally before and today is achieved through limitation, while before it was done by adding openness.

  32. It sucks. Better is Symbian 🤣🤣😂😂😂😂😂😂🤣🤣😂😂😂🤣🤣😂🤣🤣😂😂

  33. Two words: Satia Nadela

    Windows phone really started catching up toward the end. All it nedded were a few more key apps. Considering that Microsoft has more developers than any company on Earth, this could have so easily been acomplished.

    Nadella however deliberately killed Nokia in oder to destroy Tech in San Diego (where Nokia Windows phone was headquartered). It seems, putting US and European tech workers out of work was and is a top priority for Indian Tech!!

    Thats why he sent that other piece of garbage Steven Elop, to shut down the Nokia facility in San Diego. IMHO both of them should have been drug out in a field and shot.

  34. Microsoft! Where you had to pay for the OS, the Office, Updates are forced!

    Google! Where the OS is free! Office is free! Updates are free!

    Microsoft had no chance lol

  35. Then Nokia OS (Symbian Belle and one after that) were ahead of their time in some aspects, especially gestures and 3 screen system which many then used and improved. This was possibly a case of corporate terrorism, else Nokia would have managed to recover and sustain decent market share considering their popularity, especially in developing markets which went on to grow in mobility like crazy.
    Maybe from financial perspective that decision made sense, but we could've had a unique 3rd alternative today

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