Do not count MS out.
It is a safe bet that long term the big OS will be Windows Phone, Android and iOS. I would almost argue that it would go 1) Android 2) WP and 3) iOS.
Reason for it is iOS is limited to Apple only and the other are put on multiple different phones. Apple will more than likely still be #1 in single phone sells.
MS is willing to put the money to break into the market.
MS unfortunately spends their money on all the wrong things. To date, the most insightful advertisement for WP7 was a man taking a leak at a urinal that seemed to say, "this guy can get everything done in the time it takes to wizz."
The platform is almost 2 years old. In technology, that's a long time to be in the game with almost no success. If Nokia's launch with AT&T fails to make a splash... I think that's it for MS. They have no carrier support, almost no public interest, and a very high return rate of purchased devices.
The only thing propelling Windows Phone currently is that the last available model is under $50.
There's a slice of pie for someone, but I wouldn't wager my money on MS. I think if anything, Android is the most vulnerable despite their numbers. It's a really crappy OS under the hood. Google entering the handset market isn't being taken well by their partners. Android's really benefited from being freeware to device makers.... there are handsets in every price range. MS's launch partners all lost their shirts on WP7 devices. Right now they've basically got Nokia and a lone HTC model coming. Compared to over 200+ Android models? And a whopping 3 options for iPhones... not a pretty picture.
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Yeah. Usual MS. A great product that received barely any marketing, and withered on the vine because of it.
Don't think it didn't sell because it was a crappy product. No. It didn't sell because no one knew about it. The handful of people who actually went out and bought one thought it was an excellent device top to bottom.
It's the same way with WP7. They had that heavy marketing push at first, but now? I just went to one of the local mobile stores to see if they had any iPad slips in stock, and all I saw were Androids, Blackberries, and iPhones. There wasn't a single Windows Phone on display. How do they expect to sell their phones when stores won't even put the things out on the shelves?
I'm actually going to disagree. When the Zune launched, Microsoft threw tons of marketing at the devices. Ads ran on every network at every demographic, they had all the major retailers as launch partners. There were demo stations in mass retailers like Target and Best buy... and they got "crickets."
The Zune was a great device as far as features. It had much better features then the iPod... but the first version was U-G-L-Y. THen they never did much in the way of upgrading the hardware or design... and threw all their money at the Zune HD to rival the iPod touch which was an epic fail. Perhaps because of the lack of any real app store or content for the device... and it's music store was sorely lagging behind iTunes.
When Steve Jobs returned to Apple, the very first thing he did was pull in all the software engineers and designers to cuss them out. I can't remember the exact quote, but it was to the effect that, "there's no sex in the machines."
That's what Microsoft always seems to miss on. They put out half baked technology with no sex appeal. And when they try... we get things like the Kin... or the first Zune that looked like a big terd.