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Microsoft's Nadella Says Company Will Make More Phones, But They Won't Look Like Today's Devices (zdnet.com)
As he told the Make Me Smart podcast, Microsoft is looking for something far more transformative, like an entirely new category of smartphone that's so original and appealing that OEMs won't be able to resist tagging along. From a report: "At this point we're making sure that all of our software is available on iOS and Android and it's first class and we're looking for what's the next change in form and function," he said when asked whether Microsoft would make another phone. Nadella doesn't discuss what form these mobile devices could take, though Microsoft does have some candidates, like its HoloLens augmented reality (AR) headgear. No doubt he's keeping close tabs on Google's early progress with its Tango phone AR experiments.
That's been their MO for several decades. Someone comes out with a hot product, they copy it, pour gobs of money on marketing it, take losses for the first few years, but eventually take over the market. Unfortunately for them, that MO usually worked because they were able to leverage their Windows monopoly to help the product gain acceptance (Office, Internet Explorer, disk compression, disk encryption, etc). The Xbox is one of their few successes at this independent of Windows, Zune probably the most notable failure.
It would've been a lot easier for them if they'd actually thought ahead to what the future might bring, instead of copying others. Back in the 1990s they managed to displace Palm as the market leader for PDA OSes (by copying Palm but promising to make their OS share the Windows API). By the late 1990s it was obvious to most everyone that PDAs and phones would converge. All Microsoft had to do was add phone support to WinCE (which became Windows Mobile). But a few WinCE PDA companies tried to add phone functionality to their PDAs, and got no help from Microsoft. Their products were panned by reviewers for failing to work consistently as a phone, which is kinda important since phones are historically very reliable. The new smartphone market instead ended up being taken over by Blackberry (in North America) and Nokia (in Europe) who added PDA capability to their phones. And Microsoft has been trying to play catch-up ever since.