Microsoft Not Developing Smartphone, But...

There have been rumors going around for several months that Microsoft was coming up with its own smartphone, to try to reclaim some precious market share from Apple and Blackberry. The big guys at Microsoft have repeatedly denied that the company has any plans to get into the mobile hardware industry (virtually all of its mobile tech efforts are focused on developing software), but that doesn't mean they're not out to play hardball with Apple.

The Wall Street Journal recently reported that Microsoft was on the way to coming up with its own “App Store” marketplace, which Apple heavily leveraged the release of the widely-popular iPhone 3G. In addition, Microsoft is also coming up with a new WinCE OS version, more sophisticated than anything it's come up with in the past.

(If you're not familiar with the WinCE mobile operating system, Microsoft calls it “Windows Mobile” now. I just like “WinCE” better, because, well... it says so much.)

Microsoft is expected to make these big announcements (in addition to deny rumors even more) during the Mobile World Congress in Barcelona, Spain, next week.

Microsoft actually still holds a larger market share in the industry than Apple, with 12.3% compared to Apple's 9% in 2008. But that's only a 1.3% gain from 2007, while Apple tripled its market share last year from 3%, thanks in no small part to the iPhone 3G and App Store.

For once, I do think Microsoft is doing the right thing in staying with software development and licensing their creations to mobile device makers. They do have a PC hardware development department, which is probably what made everyone think an “msPhone” was on the way, but I doubt they'll do too well in that category.

Still, Microsoft has received quite a bit of criticism from the blogosphere. It now has the unfortunate image of nipping at the heels of Apple, simply doing everything their rival company did last year, instead of trying to leapfrog over the competition with something truly game-changing.

Microsoft has tried going up against the iPod before with their lukewarm-performing Zune series, and is currently trying to match up to the growing popularity of Mac and Linux PC operating systems with the upcoming Windows 7. (Reviews of which, however, are mixed at best...)

It would be interesting, though, to see Microsoft venture into hardwares a few years from now, when the risk would be a little easier to deal with. Coming up with a ZunePhone (a rumor that was almost as hot as the “iPhone Nano”) would probably be well-received, even by a diminishing portion of the marketplace.