updated 11:05 am EDT, Mon August 1, 2011
Windows Phone, Mobile revenues still miniscule
An investigation into Microsoft's SEC filing for its fiscal year has revealed that the company made very little on its mobile platforms for the entire year. Of the nearly $8.72 billion in revenue from the company's Entertainment and Devices group between July 2010 and last month, just $613 million belonged to something other than the Xbox 360, the Seattle PI found. The figure left Windows Phone 7 and Windows Mobile making no more than the amount combined.
Mobile revenues were most likely considerably less. The E&D group also includes mice and other peripherals, Mediaroom IPTV services, Surface touchscreen tables, the Zune MP3 player line, and the Zune Marketplace.
Microsoft has often been deliberately secretive with Windows Phone's sales, which many interpret as a sign they would be disappointing. After saying it had shipped 1.5 million devices to carriers in December, it kept quiet and has left it to analysts to get details. CEO Steve Ballmer more recently gave off-hand confirmation of slow sales when he commented that Windows Phone had grown from "very small to very small" nine months into its history.
Nokia is expected to give Microsoft's phone revenue a kick when its first WP7 phone launches in the fall, but the numbers are small even when factoring in Microsoft's purely software-based model. Apple in contrast made just over $13.3 billion in iPhone-related revenue for the spring quarter alone.
The shortfall helps explain Microsoft's blanket approach to suing or pressuring Android manufacturers. Being unable to compete in actual sales, the company is believed to be making more on Android patent licenses than its own platform. Limited international reach, a lack of equality in features until the Mango update, and an actively hostile retail base that often steers buyers towards Android or iPhones are all considered factors.