As Nokia's Windows Phone bet falters, there's one last hope

Despite the improvements to Windows Phone and Nokia's stylish Lumia series, customers simply aren't buying

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Governments also move slowly; plus, their budgets work in a way that they're experiencing the worst pain of the recession in 2011 and 2012, making it harder to justify new smartphones. In fact, some governments, such as the state of California, have stopped buying smartphones and are making employees bring their own.

Windows Mobile's market share is a legacy that should drop dramatically in 2013 and 2014. The questions remain: Will those users switch to Windows Phone 8, or will they go to iOS and, increasingly, Android? And will they buy Nokia devices?

It's ironic that Windows Phone 7 was aimed at social users, meaning 20-somethings. They were supposed to be the prime target for building market share, as there are lots of 20-somethings already addicted to social technologies. But they seem happy with Androids and iPhones, which can be used for social interactions and a whole lot more.

Now, the best hope for Windows Phone adoption is converting those Windows Mobile users -- mainly middle-aged government knowledge workers -- to Windows Phone 8. If all Windows Mobile users switch to Windows Phone, Microsoft's smartphone market share would triple.

That would still have Windows Phone in last place for active mobile operating systems, but at a percentage that gives hope for further growth. In such a scenario, Android accounts for 51 percent of U.S. smartphone users, iOS for 34 percent, BlackBerry for 8 percent, and Windows Phone for 5 percent. (Discontinued but still-in-use OSes account for the rest.) Windows Phone presumably could then gain some BlackBerry defectors, as it would be seen as a viable choice for the longer term.

Windows Phone has nice attributes as a mobile operating system, and its limits are artificially imposed by Microsoft, so they could be removed. But can that happen in time to matter? That's the real question for Microsoft and Nokia. The answer means more to Nokia, of course, because Microsoft can survive if Windows Phone doesn't become a hit. Nokia probably cannot.

This article, "As Nokia's Windows Phone bet falters, there's one last hope," was originally published at Read more of Galen Gruman's Mobile Edge blog and follow the latest developments in mobile technology at Follow Galen's mobile musings on Twitter at MobileGalen. For the latest business technology news, follow on Twitter.

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