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Report: Microsoft Mobile OS Share Drops, Will It Be Discontinued?

CEO's "tough choices" could include Windows Phone if share decline continues.

Greg Sterling on July 2, 2015 at 8:30 pm

The US smartphone market is relatively stable and has been for awhile. Android remains the dominant OS, yet Apple continues to see post-iPhone 6 gains and Windows Phone remains a marginal player.

According to May 2015 comScore data, the iPhone now a 43.5 percent share vs. Android’s 52 percent share. That’s up nearly 2 points since February. Some of the iPhone’s growth has come at the expense of Android but also of other platforms it appears.

Windows Phone is off half a point since February. It now stands at 3 percent, down from 3.5 percent. This share decline, following several years of little or no growth, suggests that Microsoft could ultimately exit the mobile OS business.

Microsoft CEO Satya Nadella spoke recently of “tough choices” that the company would make surrounding focus, costs and resources. In a recent internal memo obtained by GeekWire, he said the following:

Today, we live in a mobile-first, cloud-first world, and the transformation we are driving across our businesses is designed to enable Microsoft and our customers to thrive in this world. It’s important to note that our worldview for mobile-first is not just about the mobility of devices; it’s centered on the mobility of experiences that, in turn, are orchestrated by the cloud. That is why we think of these two trends together. What we do with our products and business models has to account for this fundamental transformation.

Strategy and ambitions. Our strategy is to build best-in-class platforms and productivity services for a mobile-first, cloud-first world. Our platforms will harmonize the interests of end users, developers and IT better than any competing ecosystem or platform.

While Nadella repeatedly talks of a mobile-first world, he doesn’t specifically mention Microsoft’s mobile OS. The focus will be on personal computing, business productivity and the cloud. These things can be done (and must be done) across platforms including and especially those owned by Apple and Google in the mobile realm.

Following the tough choices memo, Microsoft outsourced its display ad business to AOL (sales) and transferred some of its Bing Maps technology (and associated employees) to Uber.

With a mobile OS that is now five years old and not growing in major markets, Windows Phone must also be on the potential “tough choices” list. Before making any final decisions, however, Redmond may be waiting to see how Windows 10 plays out and whether that boosts sales of Microsoft OS mobile devices.

In its monthly figures, comScore also reports on the top 15 mobile apps in the US. Like smartphone market share, the top apps list remains relatively stable. It’s worth also noting that Microsoft doesn’t currently have a single app on the list.

Another observation: Facebook has incrementally lost audience reach since last year. A year ago it was at 76 percent and today, according to comScore, it stands at 70 percent. Of course the actual number of Facebook mobile users has probably not declined and may have grown in fact.

About The Author

Greg Sterling

Greg Sterling is a Contributing Editor at Search Engine Land. He writes a personal blog, Screenwerk, about connecting the dots between digital media and real-world consumer behavior. He is also VP of Strategy and Insights for the Local Search Association. Follow him on Twitter or find him at Google+.