Don't Hang Up on Windows Phone Yet

The folks at Microsoft (Nasdaq: MSFT  ) may not be slapping themselves on the back with glee, but they can at least breathe a little easier now that its Windows Phone operating system has finally leveled out from its steep decline in U.S. market share -- and has even gotten the tiniest bit of it back.

Research firm comScore's numbers show Windows Phone with a smartphone market share of 4% for April, up from the 3.9% it held the two previous months. Only eighteen months ago, Windows Phone held 8% of the market. In January, its share was 5.4%.

The standings as of April:

Smartphone Operating System

U.S. Market Share

Android 50.8%
iOS 31.4%
BlackBerry 11.6%
Windows Phone 4%
Symbian 1.3%

Source: comSource.

To whom should Microsoft give thanks for this badly needed turnaround? Certainly not LG, which said even though it wasn't "giving up" on the Windows Phone OS, it would shift its focus to building smartphones running Google's Android OS.

Unlikely as it may seem, the credit for pulling back the stick on the Windows Phone dive should go to the mobile phone industry's most recent whipping boy, Nokia (NYSE: NOK  ) .

The Finnish phone maker's ill-conceived ad campaign, portraying Apple's (Nasdaq: AAPL  ) iPhone and the multitude of Android phones as poorly tested beta handsets, blew up in Nokia's face when its own flagship phone, the Windows Phone-running Lumia 900, suffered an embarrassing software glitch upon its U.S. launch.

Despite that misdial, sales of the Lumia 900 on AT&T (NYSE: T  ) , and the Lumia 710 on T-Mobile USA, have been just enough to stanch the Windows Phone hemorrhaging. But can that battle dressing keep Microsoft alive in the smartphone OS theater?

Obviously, a 0.1% increase in share doesn't signal that Microsoft is out of the woods yet. But look at the other smartphone OS trends. According to comScore, Android dropped 0.2% between March and April, and Research In Motion's (Nasdaq: RIMM  ) BlackBerry continued its long slide to irrelevance, dropping 3.6% between January and April. Apple's iOS share, however, has grown from 29.5% in January to 31.4% in April.

Microsoft has a lot riding on the next version of its smartphone OS, Windows Phone 8. Codenamed "Apollo," that operating system will have a sneak preview presentation at Microsoft's developer summit to be held on June 20.

If Windows Phone 8 has what phone manufacturers, carriers, and consumers want -- support for multicore processors, higher screen resolutions, and mobile wallets -- then perhaps Microsoft can start gaining more respect and customers in the smartphone world.

However the fight for smartphone OS supremacy turns out, there will always be a need for the parts that make those phones work. The Motley Fool has released a free report called "The Next Trillion-Dollar Revolution," highlighting a "hidden" component play inside mobile phones. Don't miss out on this report. Get it today!

Fool contributor Dan Radovsky owns shares in AT&T and Nokia. The Motley Fool owns shares of Microsoft and Apple. Motley Fool newsletter serviceshave recommended buying shares of Microsoft and Apple and creating bull call spread positions in Microsoft and Apple. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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  • Report this Comment On June 07, 2012, at 1:19 AM, jhf678 wrote:

    Nothing aginast the iPhone. It is still the number one phone, but the Lumina 900 Windows phone is very nice. I think Nokia and Microsoft is a good fit.

    They will soon be at the top to compete with iPhone.

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