Microsoft plays the heavy in the smartphone wars

February 18, 2009, 5:50 PM UTC

If Apple (AAPL) is the elephant in the room this week in Barcelona, dominating the cellphone industry’s annual showcase without having to show up (see here), Microsoft (MSFT) is the 800 pound gorilla — throwing its weight around and scaring all manufacturers.

That’s the conclusion of Daniel Eran Dilger in a long Roughly Drafted post entitled “Did Microsoft Kill Android at Mobile World Congress 2009?

“How does one sell an aging mobile operating system lacking the multitouch sizzle of the iPhone and the addictive messaging savvy of the BlackBerry in a world where Google is butting in with a free, open source alternative that allows manufacturers to freely customize it as they like?” he asks. (link)

Dilger’s answer, delivered in a closely reasoned 1,800 word diatribe, is to crush the competition that scares Microsoft most. That’s not the iPhone, which CEO Steve Ballmer has repeatedly laughed off as an over-priced toy, but Google’s (GOOG) Android, the smartphone platform that competes directly with Microsoft’s own offering, Windows Mobile.

Android is anathema to Microsoft for many reasons, but the chief one, says Dilger, is that it is an open source platform running on Linux.

“In 2001, Steve Ballmer referred to Linux as a ‘cancer,’ specifically citing its open source license as the most troubling part. Software that allows manufacturers to customize it themselves anyway they choose is more threatening to Microsoft than software offered for free.” (link)

According to Dilger, Microsoft has orchestrated a behind-the-scenes attack on Android, using its considerable leverage with manufacturers up and down the supply chain to discourage them from promoting Android devices too enthusiastically.

He blames this campaign for the surprising paucity of new Android-based phones in Barcelona this week, despite the presence of most of the founding members of Google’s Android Open Handset Alliance. Where, he asks, is Samsung’s Android phone? Or LG’s? Or Motorola’s (MOT)?

Even HTC, the first company to ship an Android phone and one of the alliance’s most enthusiastic supporters, wasn’t displaying its successor — the HTC Magic — and instead showed off two new Windows Mobile phones. The journalists who gave the Magic such glowing reviews had to seek it out at the Vodafone booth.

Microsoft, meanwhile, was grabbing headlines with the announcement that by 2012 LG will build 50 different smartphones that run on Microsoft’s latest version of its mobile operating system, Windows Mobile 6.5 — by most accounts a major improvement on the original Windows Mobile that comes none too soon.

“Without that flag waving distraction,” writes Dilger, “someone in the tech media might have also noticed the fact that the top three Windows Mobile vendors [Samsung, Sony Ericsson and Palm] are scrambling away from the platform as quickly as possible…. When Windows Mobile 6.5 does show up, it will be competing against the second or third update to iPhone 3.0, as well as Android and Symbian, both sporting nearly another year of improvements.”

UPDATE: In a report published Wednesday evening, AppleInsider’s Prince Maclean added more detail to the Barcelona backstory, including Microsoft’s inadvertant revelation that although 50 companies have licensed its mobile OS, 80% of all Windows Mobile phones so far have been manufactured by one company: HTC. See here.

Windows Mobile was an early entrant in the smartphone operating system market, but has lost ground lately. Its share of the worldwide market shrank from 23% in 2004 to somewhere between 12% and 14% in today (link). Dilger believes he knows why:

“The problem with Windows Mobile isn’t that it lacks a catchy name or a layer of cheesy UI [user interface] frosting, … but that it’s a really terrible platform. It has a weak foundation in Windows CE and gross technical deficiencies that run up from its feeble graphics architecture through its brain-dead, archaic Win32 APIs and its horribly designed desktop windowing system shoehorned into a mobile screen.”

To find out what Dan really thinks, read the full story here.