FORTUNE -- Microsoft (MSFT) is reportedly considering a radical shift in its mobile strategy: offering its operating systems free to manufacturers of mobile devices.
The Verge, quoting unnamed sources "familiar with Microsoft's plans" reported Wednesday that the company might trade in the revenues it gets from licensing Windows Phone and Windows RT by offering free versions of them in order to gain market share. The idea would be to increase opportunities to earn revenues from search ads as well as via Microsoft's apps and subscription services such as Skype, SkyDrive, and Office.
Microsoft purchased Nokia's handset business this fall. Because Nokia was by far the largest Windows licensee for phones (it represents 80% of the Windows-powered handset market), a lot of that revenue has been lost anyway. Licensing fees make up the biggest source of revenue for Microsoft's operating systems.
In fact, licensing is what built the company. In its early days, Microsoft decided that licensing MS-DOS, then Windows, to manufacturers was the best way to dominate the market for personal computers. Apple (AAPL) took the opposite tack, allowing its operating systems only on its own computers. Microsoft won that battle, and it wasn't until the rise of the popular Internet, and the subsequent explosion of mobile devices, that licensing became less important in the consumer market than other sources of revenue, such as ads. That's why Google (GOOG) was able to dominate the market for phone operating systems, and take up a sizable chunk of the tablet market. Google got into the mobile business to boost its existing business: ad sales. And it has worked. By offering free versions of Windows, Microsoft would be targeting Google by following that company's own strategy. Microsoft's main interest there is in taking away as much of Google's whopping-big share of the online ad market as possible.
If Microsoft is indeed planning such a move, it would mark a big change in its corporate strategy, at least in the consumer market, as well as a tacit admission that its approach to the mobile market hasn't worked well enough.
The decision will come down to whether the lost licensing fees would be made up for by increased revenues from ads and subscription services. That's not an easy calculation to make. Microsoft will surely gain market share, but that might not be enough, given Google's dominance, and the loyalty of Apple customers toward both phones and tablets, which for Apple are high-margin businesses.
As one commenter on The Verge put it, "Microsoft isn't sure whether it should become Google or Apple." There is a third possibility: that in the mobile market, it will become neither.
How a marketing message makes its way from press release to headline.
FORTUNE -- The PR folks at Kantar Worldpanel are worth every penny they're getting paid.
Kantar is the research arm of the London-based WPP Group (which happens to handle Microsoft's (MSFT) online ad sales). It's best known for its quarterly reports on smartphone shares in 10 markets worldwide.
And for the third quarter in a row, Kantar's press release led not with the results for Android (No. MOREPhilip Elmer-DeWitt - Nov 5, 2013 8:21 AM ET
Good Tech's Q2/Q3 report shows Android trailing and Windows Phone going nowhere.
FORTUNE -- Good Technology, a Motorola spin-off that sells a secure app development platform to government agencies and 50 of the Fortune 100 companies, reported Thursday that activations of custom-made mobile apps are growing at a "staggering pace" among its 5,000 clients, and that Apple's (AAPL) iOS is the clear favorite.
The attached chart shows the number of mobile devices activated MOREPhilip Elmer-DeWitt - Oct 19, 2013 7:31 AM ET
Google's Android and Apple's iOS still make up the vast majority of the market.
FORTUNE -- There's a new number three.
Microsoft's (MSFT) Windows Phone operating system has overtaken BlackBerry (BBRY) for the first time, according to researcher IDC. The firm released its quarterly report on the smartphone market, showing that during the first quarter of 2013, Windows devices made up 3.2% of all smartphones shipped. BlackBerry devices accounted for 2.9% of MOREMatt Vella - May 16, 2013 10:46 AM ET
In the U.S., it's everybody's but Apple's according to comScore.
FORTUNE -- It's often been said that Android's share of the U.S. smartphone market has come chiefly out of the hides of Research in Motion's (BBRY) BlackBerry and Microsoft's (MSFT) Windows Phone, but nothing shows this quite as clearly as Horace Dediu's charts at Asymco.com.
Not that Apple (AAPL) hasn't been hurt by the success of Google's (GOOG) mobile platform. Some of MOREPhilip Elmer-DeWitt - May 5, 2013 6:56 PM ET
Also: Google's stock takes the plunge; Gilt puts Jetsetter up for sale.
Google's stock falls 8% after grim earnings come out early [CNNMONEY]
The company missed analysts' estimates on both sales and profit. Google shares slumped on the news before being halted for about 3 hours. The stock resumed about 40 minutes before the end of the trading day and closed down 8%.
Elop: a Surface phone would stimulate the Windows Phone ecosystem [THE VERGE]
Nokia MOREJP Mangalindan, Writer - Oct 19, 2012 6:30 AM ET
Apple next act; why Google Hangouts are hot.
Bernstein Research: People don't want Windows phones [BOY GENIUS REPORT]
"Our research shows that for many years, poor sales of Windows-based phones stem from a deep and stable lack of consumer interest for the product," Ferragu wrote. "Despite numerous and repeated efforts of manufacturers (Nokia, but also Samsung and HTC) and Operators to develop an alternative toAndroid and Apple based on Windows, and despite the launch of numerous phones based MOREJP Mangalindan, Writer - Aug 30, 2012 1:18 PM ET
Sony Mobile laying off 1,000 people; why the freemium business model isn't all it's cracked up to be.
Microsoft gets a new logo [THE SEATTLE TIMES]
The new logo, which incorporates a multicolored Windows symbol in addition to the "Microsoft" name in straightforward, lighter type, is intended to "signal the heritage but also signal the future — a newness and freshness," said Jeff Hansen, Microsoft's general manager of brand strategy. It's coming MOREJP Mangalindan, Writer - Aug 23, 2012 1:11 PM ET
The secret to Reddit's massive success; 3 reasons why Microsoft's Surface warrants a serious look.
YouTube's gigantic year is already here, Citi says [ALLTHINGSD]
The video site should generate more than $3.6 billion in gross revenue this year, says Citi's Mark Mahaney. After distributing some of that to partners, Google probably records net revenue of $2.4 billion, he says.
How Reddit got huge: Tons of fake accounts [MOTHERBOARD]
But in terms of power, not traffic, MOREJP Mangalindan, Writer - Jun 22, 2012 1:10 PM ET
A peek at WWDC through the Windows Phone looking glass
FORTUNE -- "Yesterday, Apple Inc. finally revealed their latest iteration of iOS for iPhone and the iPad. There were no real 'wow' moments just the continued rehash of market numbers and a collection of little improvements to the world-wide hit operating system."
So begins Daniel Rubino's coverage of Apple's (AAPL) World Wide Developers Conference on WPCentral, where "WP" stands for Microsoft's (MSFT) MOREPhilip Elmer-DeWitt - Jun 14, 2012 7:17 AM ET
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