Kill Windows Phone or risk dying, analyst tells Microsoft


Both Thompson and Evans pointed out that with Microsoft's acquisition of Nokia -- the Finnish handset maker responsible for 84% of all Windows Phone sales -- other OEMs, lukewarm to Windows Phone at best, will simply drop the OS to focus fully on Android.

"Ownership by Microsoft will not of itself change the sales of Windows Phones. If anything, it will decrease them, since it prompts other OEMs to give up on it entirely," wrote Evans in a post to his personal blog last week. "It will not make more developers make Windows Phone apps or more consumers buy the devices. And it does little or nothing for Windows on tablets."

Absent a truly radical solution, Microsoft's hand was likely forced by Nokia's weak financial status, analysts have said. Microsoft was afraid that Nokia would fail, and take Windows Phone down with it. That theory got a big credibility boost on Friday when Nokia immediately drew on $2 billion in convertible bonds that Microsoft offered to buy as part of the agreement.

CEO Steve Ballmer, who last month announced he would step aside in the next 12 months, had the support of the Microsoft board of directors and its chairman, company co-founder Bill Gates, in the Nokia deal. Alternative strategies were either dismissed -- after all, Ballmer has been the driving force behind the pivot to a new "devices-and-services" strategy, again with the board's support -- or simply quashed. Doing anything else would have been unthinkable to the board, and if he had pressed it, it's likely Ballmer would have been immediately fired.

That didn't stop Thompson from advocating for Windows Phone's demise, positing that as a more viable long-term strategy than what Microsoft is now pursuing.

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