Feeds

Windows 8

Apple iOS 7 makes some users literally SICK. As in puking, not upset

Excessive zoom and 3D-effect graphics in Apple's latest iOS is leaving some users reaching for the sick bucket

Windows Phone 8: Microsoft quite literally can't lose

If it bombs, Ballmer is no worse off than he is now

Choosing a cloud hosting partner with confidence

Should Microsoft's mobile operating system Windows Phone 8 bomb, the effect on the software giant's sales would be negligible - but the same could not be said for its prestige.

According to one estimate, sales of WinPho handsets added a mere $736m to Redmond’s coffers in its last fiscal year – that’s just under one per cent of Microsoft’s total business. The Windows client division and the server and tools wing made $18bn each in fiscal 2012, which ended on 30 June. These are Microsoft’s two biggest business units.

Overall, the Steve Ballmer-led giant reported $73bn in sales for everything in that 12-month period.

The WinPho figures are based on some number-crunching by economic consultant Adam Ballantyne on the Seeking Alpha Wall Streeters’ web site here.

Microsoft, which leaves the manufacturing and flogging of the actual handset hardware to Nokia and other partners, doesn’t make its Windows Phone sales public. It’s part of the entertainment and devices (E&D) division, which is also home to Xbox 360, Skype and Media Room, Microsoft’s TV-over-the-internet service. As with Microsoft’s other groups, the E&D numbers are reported as a whole, unless individual lines are thought flattering or help prove some growth point.

For the last fiscal year, E&D reported $9.59bn in revenue – the second weakest performer in Microsoft's portfolio, ahead of the perennial weakling: Microsoft's online business that’s home to search engine Bing, another Redmond catchup effort.

Ballantyne got his numbers by going back over three years of E&D results, and stripping out Xbox 360, Skype and Media Room.

Revenue tells only part of the story, though, and what we don’t get from Ballantyne are profit and loss figures – which would reflect just how much Microsoft spent on staff and marketing among other expenses.

If phone-maker Nokia cuts WinPho 8 prices, and other handset partners follow suit, then this could wipe out any hope of a profit from this mobile endeavour for Microsoft. Much will depend on how many Windows Phones are sold, and the point at which volume rubs out the loss.

As an example of the current state of play, every $49 Lumia phone sold in the US has been sold at an up-front loss to Microsoft's carrier partner AT&T, which is estimated to be spending $450 in marketing per handset.

Windows Phone 8 will launch on 29 October. Ahead of that partners are trying to stoke the market – Samsung announced a Windows Phone on Wednesday and Nokia is expected to make its own Windows Phone 8 announcement on 5 September. Adverts are appearing online and posters are being plastered across railway stations in Great Britain, targeting Google fandroids and Apple fanbois heading to work and hungry for something new.

A long battery life seems to be the big selling point Microsoft and Nokia are pushing on. Redmond-backing bloggers are pumping away, poring over the minutiae of every detail of Windows Phone to shamelessly salivate and froth about each new handset.

If this doesn’t work for Microsoft, nothing will. And if this doesn’t work, then it’ll just be question of how long the company wants to support yet another drain on its resources. Based on Microsoft’s experience with Bing, the answer might be quite some time. ®

Secure remote control for conventional and virtual desktops

More from The Register

next story
UNIX greybeards threaten Debian fork over systemd plan
'Veteran Unix Admins' fear desktop emphasis is betraying open source
Netscape Navigator - the browser that started it all - turns 20
It was 20 years ago today, Marc Andreeesen taught the band to play
Redmond top man Satya Nadella: 'Microsoft LOVES Linux'
Open-source 'love' fairly runneth over at cloud event
Return of the Jedi – Apache reclaims web server crown
.london, .hamburg and .公司 - that's .com in Chinese - storm the web server charts
Chrome 38's new HTML tag support makes fatties FIT and SKINNIER
First browser to protect networks' bandwith using official spec
Admins! Never mind POODLE, there're NEW OpenSSL bugs to splat
Four new patches for open-source crypto libraries
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.