Microsoft Windows Mobile Lands US Census Deal

After getting out of the gate slowly, Microsoft won its largest-ever contract for mobile phone software from the U.S. Census Bureau. The contract covers 500,000 handsets and could lead the software giant to dethrone Research In Motion's (Nasdaq: RIMM) BlackBerry as the most prolific device on the market.

Windows Mobile phones will help census takers collect information door-to-door during the 2010 U.S. census. The phones offer them the ability to connect to the Internet, read e-mail, listen to music and even run Office. Taiwanese manufacturer HTC will build the handsets. The firm has in the past also built Treos and iPaqs.

"This is a big win for Microsoft, though obviously a bigger win for whoever it was in sales that closed the deal," joked JupiterResearch analyst Michael Gartenberg. "It certainly validates the Windows mobile platform as a viable alternative for large scale projects."

Calculating the Market

Microsoft, of course, is still the underdog. Even though IDC predicts shipments of Windows-based phones to double in each of the next two years, Windows would still only account for 13 percent of the overall market. BlackBerry currently holds 80 percent of the market.

Forrester Research meanwhile estimates that Windows runs 5 percent of high-end devices that cost US$300 or more at large businesses in North America. By 2010, Forrester predicts Microsoft could increase its share to 60 percent at the expense of BlackBerry.

Mobile phone operating system leader Symbian will gradually lose share to Microsoft's Mobile Windows and to Linux , according to a report by The Diffusion Group (TDG) entitled "Advanced Mobile Operating Systems: Analysis & Forecasts."

"Symbian will maintain leading share through 2009, but 2007 will see the beginning of Symbian's decline in share as the combined market penetration of Windows, Linux and native Java begin to erode developer and vendor support for Symbian," said Lee Allen, lead mobile analyst with TDG.

Symbian's Fate

Symbian's slow decline began in 2005, according to TDG's chronicle. At the end of last year, it enjoyed a market share of 51 percent, followed by Linux at 23 percent and Microsoft at 17 percent, the firm reports.

However, Linux began gaining on Symbian in the second half of 2005, with a sizable boost in shipments. TDG believes this Linux trend will continue in 2006.

At year-end 2010, Symbian's market share of advanced mobile devices will decline to approximately 22 percent, behind both Windows at 29 percent and Linux at 26 percent, TDG reported.

How does Microsoft's latest win impact Symbian? "Obviously, Symbian would have preferred to see a device with its platform chosen for a project of this magnitude, but there's still a lot of life in that operating system. It goes to show that there is lot of competitive action in this space and there is no one dominant platform," Gartenberg told TechNewsWorld.

Success Breeds Success

Microsoft will leverage the presence of the Pocket PC and smartphone versions of Windows Mobile, along with tight integration of Windows Mobile 5.0 with other Windows platforms, into a strong value proposition for enterprise and advanced consumer users, TDG predicted.

"This is not such a watershed moment for Microsoft, but another step in a process that's been years in the making to get the right devices and the right partnerships out there and demonstrate to the market that this is a viable platform for these types of large scale projects," Gartenberg said. "Typically what you do see in situations like this is that success breeds success."