Apparently, there are number of people saying that the Google/Motorola deal is good for Microsoft. The thinking goes that, with Google potentially taking control of the Android space with their own handsets, carriers and handset manufacturers will be more interested in Windows Phone 7. That means more handsets and more sales.
I don’t see that. First, most of the handset makers in question (Samsung, HTC) already have Windows Phone 7 products. They have from it’s inception, as they moved from Windows Mobile. None of the major handset producers have relied on Android exclusively. It is possible, over time, that Windows Phone is the only viable option for 3rd party manufacturers. Yes, Android would still be available to them, but they could be competing for a shrinking piece of the pie as Google gobbles up sales. But, its not like there will suddenly be more manufacturers offering Windows Phone 7, and I don’t see a bigger selection of devices from the manufacturers.
Second, I don’t see this as changing customer’s minds about their mobile platform choice. People are choosing iOS for content (apps, media, books, etc) and Android because it offers similar content at a lower price (albeit with less consumption by those users). People aren’t picking Windows Phone 7, even with some handsets being heavily subsidized. It isn’t just about price, or even selection and availability. Apple is commanding a huge piece of the mobile market with essentially one handset, iPhone 4. They are holding their own and continue to gain marketshare, even without a broad selection of phones in varying shapes and sizes. If the presence of Google results in a thinner selection of Android phones and tablets, that doesn’t necessarily mean that Android sales will slow or drop.
Third, I don’t see this as changing developer’s minds when it comes to platform choice. Supporting two platforms for an app is hard enough (given that they use different programming languages, different development environments and different API’s). Adding a 3rd, also with it’s own language, API and development platform, can simply be too expensive for many developers. Besides, your best chance to make money is to have the largest target to shoot at, and with iOS and Android having installed bases that are an order of magnitude or more bigger than Windows Phone 7, and getting bigger all the time, I still don’t see this shifting the landscape in Microsoft’s favour.
Part of this comes down to how much choice consumers actually want. People like choice, but beyond a certain point, they don’t really care, and more doesn’t always mean better. There’s a reason we have fewer active car brands now than we did back in the 1940’s and 1950’s: beyond a certain point, the level of choice wasn’t important, and people settled on fewer and fewer brands over time. Do consumers want more than 2? Certainly they do. But, in the smartphone market they have 5 major platforms to choose from (iOS, Android, WebOS, Blackberry, Windows Phone, 6 globally if you count Symbian, which is still out there), and they are voting long and loud for 2: iOS and Android. That may change in the future, but for the short-term and medium-term, those are the horses in this race.
Personally, I think this hurts Microsoft. This means that their plethora of disjointed and inconsistent devices of varying quality (some good, some not so good) will be up against two companies, and not just one, that care about industrial design and the end-to-end user experience. One of them does not carry a perception of premium prices, but still is perceived as premium quality. I fully expect Google will continue to offer a value handset, and will try to chase the bottom of the market, although they could leave that to the Samsung’s and the HTC’s of the world. Consumers care about more than price, and while price is a factor, they will also consider the design and the quality, both real and perceived. I think this deal will simply push Windows Phone 7 further to the margins as customers see this development as good for them because it means better products for the same price. They will care even less than they do now about a Microsoft-based handset.