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Is Windows Phone 7 a Flop?

Microsoft prepared a long and expensive build-up to the launch of Windows Phone 7, and for the most part we bought into it. It really is sleek and functional — the first Microsoft phone OS that could conceivably take on iOS and Android. But since the launch, Windows Phone 7 news has been oddly quiet.

So is Windows Phone 7 a flop?

Well, yes and no.

If you look simply at sales, Windows Phone 7 hasn't had an explosive launch. Not many people seem to have a Windows Phone 7 device yet, and a widely circulated rumor from industry experts says that Microsoft only sold 40,000 handsets at launch in November 2010. That's not exactly big business in the smartphone market.

By comparison, the original Apple iPhone launched in June of 2007 and sold more than 1 million units in its first quarter. Android launched in October 2008 and sold nearly 4.5 million handsets by the end of the year. Although Windows Phone 7 hasn't even been available for a full quarter yet, it doesn't have a very good start compared to the competition.

"There are very few handsets available and some regard Windows Phone 7 as still being in 'soft launch,'" said Victoria Fodale, senior analyst on ABI Research's mobile devices team, in an interview with TechNewsDaily.

Apps matter

We can also take a look at app stores, which have quickly become one of the most defining characteristics of popular phone platforms. According to Fodale, the Windows Phone 7 platform has over 4,000 apps, whereas Android has well over 100,000 and the iPhone surpassed a quarter million apps several months ago.

"Although I am not ready to say that Windows Phone 7 is down for the count, things could certainly be looking better for Microsoft," Fodale said.

Despite the worrying numbers, Microsoft says it remains optimistic.

"Microsoft is pleased with the response so far to Windows Phone 7 and looks forward to working with our partners to continue to promote the great experience that WP7 brings to consumers throughout the holiday season and beyond," a Microsoft spokesperson told TechNewsDaily.

As Microsoft and Fodale indicate, it's still a bit early to call Windows Phone 7 D.O.A. There are many promotions happening over the holidays that will likely boost sales. And a little perspective helps to make the big picture look a little less glum. While the iPhone had amazing press and rabid early adopters from the beginning, Android took quite a while to become the second most popular OS in smartphones.

Despite good early sales, Android remained a relative unknown among regular consumers until Verizon started a big Android sales push in late 2009. The DROID line of Android phones, along with increased Android sales on other carriers, has helped to bring Android into public consciousness.

Still in the game

In that light, it's impossible to count out Windows Phone 7 after only one full month of sales.

Android also had to go through a growing process with features. Though quite functional when first released, Android still couldn't quite compare to the iPhone in usability and functionality. Only the most recent versions of Android (2.1, 2.2 and 2.3) are starting to be recognized as true contenders to the iPhone. Microsoft similarly plans to add many important features, such as copy-and-paste functionality, to Windows Phone 7 over the course of the next year that will make it more comparable to iOS and Android.

Developers on board

Perhaps one of the most telling signs of Windows Phone 7's potential to grow is that developers haven't given up on it. Dave Castelnuovo, co-founder of Bolt Creative, has had great success with Android and iPhone games.

Bolt Creative's Pocket God game was the No. 1 best-selling app in the Apple App Store for nearly a month in March 2009. But even with a successful business making iPhone apps, Castelnuovo still thinks Windows Phone 7 apps will be worth his company's time.

"We are developing [apps] for Windows Phone 7 because I expect it to be a player in the future and we want a presence on this platform. I’m still not sure if it will beat out Android or iOS, but knowing Microsoft, they have a lot of resources and patience and it will be a permanent part of the landscape moving forward," Castelnuovo said.

Windows Phone 7 developers are experiencing a few early problems, Castelnuovo said, because the system is still new and Microsoft hasn't ironed out all the wrinkles. Part of the problem is the tight control Microsoft has tried to retain over how Windows Phone 7 is used, as opposed to the open source treatment of Android.

"They are basically trying to leverage multiple hardware manufacturers while retaining tighter control to combat the fragmentation issues that Android is having. It’s a 'best of both worlds' approach but at the end of the day, they need to create an exciting device that people need to have," Castelnuovo said.

A gradual growth

Of course, Apple has proven that a vibrant app environment can still grow out of a tightly controlled development process. As long as Microsoft can attract enough developers, Windows Phone 7 should eventually have a large catalog of apps, too. It's just that the task of recruiting developers hasn't been an easy one, and it might remain difficult until the next generation of Windows phones arrives.

"So far they have gotten off to a slow start, but I think … it may gain steam as they start to produce second generation Windows Phone 7 devices. My guess is that it will start to eat into Android’s market share next year, and it will follow the gradual growth of Android a little more closely than the explosive product launches that made the iPhone what it is today," Castelnuovo said.

Of course, even with this optimistic outlook on Windows Phone 7's slow start, it doesn't mean that Castelnuovo — or any developers for that matter — are ready to jump ship from the U.S.S. iPhone Money Machine.

"Our main effort will always be on iPhone. That’s our home," Castelnuovo said.

As always, Microsoft's job will be to convince consumers otherwise.