Will Windows Phone 8.1 Revolutionize Microsoft's Struggling Mobile Platform?

Microsoft (NASDAQ: MSFT  ) has long enjoyed dominance in the PC arena, with Windows 8.1 recently passing OS X Mavericks in installed copies and locking down the top five operating systems as different versions of Windows. The same can't be said of its mobile OS Windows Phone, however. Despite positive gains in Europe and some other parts of the world, Windows Phone still lags significantly behind Apple's (NASDAQ: AAPL  ) iOS and Google's (NASDAQ: GOOGL  ) Android in terms of mobile market share.

To help correct this, Microsoft is working on its Windows Phone 8.1 update (which shares a naming convention and overall strategy with the Windows 8.1 update for PCs and tablets). Despite adding features that might make it more attractive to consumers and app developers, however, the update might not be enough to take Windows Phone where it needs to be.

Windows Phone's coming of age
With Windows Phone 8.1, which is expected early in 2014 but currently has no definite release date, a few new features are reportedly being added, but they're old hat to iOS and Android users.

The most prominent of the rumored features are a notification center that is accessed by swiping down from the top of the screen and a Siri-like virtual assistant named "Cortana" (taken from the character in Microsoft's "Halo" game series). It's also rumored that Windows Phone 8.1 will feature the ability to individually set volume levels for different apps, and that it will see the demise of physical buttons by introducing on-screen buttons instead.

It's easy to understand why Microsoft is making these changes (assuming that they all come to pass.) Adding features that are common in the leading mobile platforms would make it easier for new users to adapt to Windows Phone if moving there from the competition, and removing physical buttons could lower the price of manufacturing handsets as well. It might also make it easier for manufacturers to adopt Windows Phone since they could release WP versions of Android-powered smartphones without having to redesign the phone to add buttons.

Will it work?
I recently discussed some of the headway that Microsoft is making in the mobile market. While Windows Phone is currently in a distant third place, it's inching closer to 10% market share and in some regions has actually captured 15% to 20% of the local market. The platform is even making headway in regard to a perceived lack of apps; as of November, the platform was seeing uploads of approximately 500 new apps per day and has had over 3 billion downloads to date.

The problem with this is that the rate of growth isn't fast enough to begin closing the "app gap" anytime soon. While it's a positive sign that Windows Phone recently passed the 200,000 app mark, this pales in comparison to Apple's 950,000 apps or Android's 1 million. While those numbers are obviously subject to large amounts of shovelware, Windows Phone suffers from the same problem. Worse yet, apps made popular on the larger platforms aren't always available on Windows Phone right away (or in some cases, at all); this means that consumers have to buy Android or iOS devices just to access the current popular apps.

That doesn't mean that all hope is lost, of course. Some game makers such as Rovio are beginning to produce Windows Phone versions of their new and popular games right alongside the Android and iOS versions, and a growing number of big-name apps are finally making their way to the platform. Windows Phone isn't going to close the gap completely, but if it can become a viable platform for the developers of must-have apps then the gap will matter significantly less. After all, it won't matter if Windows Phone doesn't have 500,000 apps that few users know about so long as it has the few apps that most users want.

The future of Windows Phone
If Windows Phone 8.1 manages to build upon the success of Windows Phone 8, Microsoft could establish itself as a serious competitor in the mobile field. This isn't to say that it would be able to overtake Apple or Google, but it could establish enough of a presence for more developers to include it in their releases and to gain more recognition in the public's eye. That's not going to happen overnight, though.

The rumored features give us a glimpse of the direction that Windows Phone might be headed, and that direction seems to be following the paths beaten by the giants of the mobile sector. This isn't necessarily a bad thing, though; after all, it's Android and iOS that set the expectations of the users Windows Phone hopes to capture. More importantly, potential cost-cutting measures like removing physical buttons could help the platform continue to excel in the lower price points where it has seen most of its recent growth.

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Read/Post Comments (7) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 26, 2013, at 12:58 PM, CharlesClarke3rd wrote:

    Yes. Yes. Windows Phone definitely lacks any malicious malware apps that iOS and Android both have. You got Microsoft there. If thats the only difference, its no wonder that emerging markets are purchase windows phone 2 to 1 over Apple's junk phones.

  • Report this Comment On December 26, 2013, at 9:01 PM, symbolset wrote:

    Oh wow. 3.6% is "inching closer to 10%" now? "Build upon the success of Windows Phone 8"? Oh really. What phantasmal success would that be?

    Why does The Motley Fool allow the author to misrepresent the facts as a foundation for advertising? Do they not care?

  • Report this Comment On December 26, 2013, at 9:36 PM, lcmesquita3206 wrote:

    Phone buttons are a great convenience feature that enables easier operation of the phone. It would be a mistake to remove the buttons from WP. WP needs to add multitasking, ability to close apps and ability for apps to interact with devices (accel, gyro, gps, compass etc.) when the screen is locked.

  • Report this Comment On December 27, 2013, at 11:04 AM, genghis wrote:

    @symbolset I believe the 10% market share stat was a reference to WP's combined share of the 5 largest European markets where I believe but am not 100% positive was at 9.7% in the latest figures. In fact in some markets such as Italy, WP has already surpassed iOS. It is not out of the question for WP to make further gains at the iPhone's expense especially in emerging markets with fine full featured yet low cost phones like the Lumia 520 & it's successor the 525.

  • Report this Comment On December 27, 2013, at 12:45 PM, sypoth wrote:

    Honestly, the Metro interface is great on small touch devices such as phones and tablets, unfortunately it is still as ugly as it comes and a complete burden one you try to do anything other than use it for facebook, listening to music, viewing photos, and takings a picture. The interface is purely to blame, nobody likes how it looks or how it functions, it doesn't matter what phone it's on it's still ugly, it doesn't matter what person uses it it's ugly enough to make that person look ugly as well and to top it off with how clunky it is it's practically and functionally useless. It doesn't matter that someone on Microsofts team thinks it's great and the way of the future, nobody else especially the consumers say otherwise, rather than pushing a platform nobody likes why not go back to the interface everyone did like? You know, the interface that even at it's worst has outsold the new one from BOTH iterations of it separate or combined ten fold.

  • Report this Comment On December 28, 2013, at 2:34 AM, badgerzilla wrote:

    Windows Phone lacks everything.

  • Report this Comment On January 02, 2014, at 5:32 AM, charms55 wrote:

    Actually, once personalized, the Modern UI can be strikingly nice looking. My photo HUB sits at the top of my Start screen and cycles through my favorite photos. Family, floral in our yard and landscapes, like our recent visit to Mt. Fuji. The Bing Weather app is likewise very nice and with my locale in a nice wide tile and other imnportant locations in smaller tiles, each with a photo showing the type of weather and season/time of day.

    They are also Live Tiles. This means as people update and I update data, it is shown on the screen. At times, I can read a headline and see the image without ever opening a news tile.

    Now, I came here from iOS, so it is not that I haven't used other UI. However, static numbers indicating changed data, and scrolling through page after page to find apps in whatever order they were installed leaves me cold.

    I also see people bemoaning features recently added in the recent Update 3, such as the ability to close apps more readily, very much like the "big boys."

    As the article states, much rides on this next update. however, the article also missed that Windows RT and the Phone OS will essentially become one with an integrated Store, and features from both being ported to the other. The recent Preview Xbox Music and Video point the way towards much greater integration, and video I recently purchased and viewed on my phone are also readily available on my laptop and tablet (Windows 8 Pro). This integration is the heart of the WP and Windows platforms, and the next iteration of the UI will be significant.

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