Microsoft forecasts sales of 30 million Windows Phone 7 handsets through 2011

A slide shown during yesterday’s ReMIX event in Paris clearly states that Microsoft is predicting incredible sales of the forthcoming Windows Phone 7 platform. The number given is 30 million handsets sold through the end of 2011. This is ambitious for any mobile platform, let alone one that is unproven and still months away from release.

For comparison’s sake, this is more than double the total first year iPhone numbers, but 3 years into the products life cycle, Apple has sold a purported 51+ million. Solid Android sales numbers are harder to come by, but if Google is to be believed, it are now outselling the iPhone. While the smartphone category is quickly expanding, can Microsoft really swoop-in and match the two heavily entrenched market leaders?

Engadget clarifies that this 30 million number doesn’t even account for other Microsoft-backed handsets, such as the recently released KIN lineup. MobileTechWorld points to Microsoft’s claim that smartphones will account for 40 percent of the handset market in 2011, as opposed to a 14 percent share in 2010, as a motivating factor for this bold forecast of Windows Phone 7 sales.

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Apple gets approximately $630 of revenue per iPhone, including a cut of carrier fees, app sales, and search revenues. Margins on Apple products are generally around 50%.

Microsoft sells licenses of Windows Phone 7 for $25 apiece. It will get a cut of app sales and search revenues, but it will not get a cut of carrier fees.

If Microsoft runs away with the prize and gets 90% of the mobile phone market, Apple will *still* be making more money. That's the power of a closed system when you can convince people to pay premium prices for your product.

TomJones said,
Apple gets approximately $630 of revenue per iPhone, including a cut of carrier fees, app sales, and search revenues. Margins on Apple products are generally around 50%.

Microsoft sells licenses of Windows Phone 7 for $25 apiece. It will get a cut of app sales and search revenues, but it will not get a cut of carrier fees.

If Microsoft runs away with the prize and gets 90% of the mobile phone market, Apple will *still* be making more money. That's the power of a closed system when you can convince people to pay premium prices for your product.

You do know the $630 is not straight up profit, right? That money goes to their vertical line of R&D, mfg and marketing. Apple owns everything... which means they have to PAY for everything. Microsoft became as big as it did because of licensing. They license cheap, earn volume and have very VERY little overhead when compared to competitors like Apple and IBM (in the corporate world).

Considering that baby boomers like my Dad and his friends are starting to express interest in SmartPhones after seeing their adult kids benefit from them - that's a huge and totally untapped market right there. Smart phones also tend to have larger on-screen buttons and easily readable displays that attract the older crowd. Add to that the fact that most of the boomers I know are solidly in the Windows camp and the numbers look feasable.

As a Dev I've had a ho-hum attitude toward Silverlight but I was interested in using it for mobile dev. Turns out you can do WP7 Dev in Silverlight or XNA with a free set of Dev tools - and if you decide to put it out on the marketplace you need to pay $99 for a merchant account essentially. Not unreasonable IMHO.

far too ambitious imo. They're going to sit in 4th place till they stop making rubbish limitations or bad design choices and things.

Digitalx said,
far too ambitious imo. They're going to sit in 4th place till they stop making rubbish limitations or bad design choices and things.

Worse limitations then an iPhone?

dave164 said,

Worse limitations then an iPhone?

Childish remark. iPhone is popular despite its limitations, does the rest well and has a 4 year track record. BTW we are talking bout Windows Mobile 7.

Edited by Borix, May 28 2010, 12:51pm :

Borix said,

Childish remark. iPhone is popular despite its limitations, does the rest well and has a 4 year track record. BTW we are talking bout Windows Mobile 7.

No, it's not a childish remark, it's a direct reply. The original comment claimed that they would be in 4th place (and by extension, behind apple) because of their limitations, and he's pointing out that the iPhone has plenty of limitations.

The iPhone is popular because it has Apple's backings, and Apple knows how to market. Take off your shiny-vision goggles for two seconds and come look at the real world of mobile phone software.

30 million Windows Phone 7 handset sales through 2011? I can't believe that'll happen. 30 million iPhone sales through 2011? I can believe that.

Look what Microsoft did with the XBOX, They Conquered the Playstation with the 2nd gen device, History will repeat itself and they will with the phone...., Microsoft mean business with this device....and THEY will succeed.

cheops2006 said,
Look what Microsoft did with the XBOX, They Conquered the Playstation with the 2nd gen device, History will repeat itself and they will with the phone...., Microsoft mean business with this device....and THEY will succeed.

The original Xbox wasn't too big of a success though, it had some popularity but it wasn't until the Xbox 360 did they take over online gaming, and even now the Xbox 360 is a distant second to the amount of consoles sold.

Omen1393 said,

The original Xbox wasn't too big of a success though, it had some popularity but it wasn't until the Xbox 360 did they take over online gaming, and even now the Xbox 360 is a distant second to the amount of consoles sold.

Indeed. Microsoft likes to go head-to-head, and they put their sights squarely on Playstation. And while they were preoccupied, Nintendo ran away with the prize.

And not only that -- but while the game console wars were happening, Sony bought the distribution rights to the MGM library and sealed its victory for Blu-ray. Sony!!! The same company that lost the Beta vs. VHS format war! The same company that surrendered before the DVD format war even started!

Edited by TomJones, May 28 2010, 2:50pm :

TomJones said,

Indeed. Microsoft likes to go head-to-head, and they put their sights squarely on Playstation. And while they were preoccupied, Nintendo ran away with the prize.

But, how is it not a prize for Microsoft? The Xbox division is right behind the Windows and Office groups for Microsoft profit generation. People need to stop looking at this as a zero sum game. MS, Sony, and Nintendo can all be profitable at the same time with their consoles. MS, Apple, and Google can all be profitable at the same time with their phones.

TomJones said,

Indeed. Microsoft likes to go head-to-head, and they put their sights squarely on Playstation. And while they were preoccupied, Nintendo ran away with the prize.

And not only that -- but while the game console wars were happening, Sony bought the distribution rights to the MGM library and sealed its victory for Blu-ray. Sony!!! The same company that lost the Beta vs. VHS format war! The same company that surrendered before the DVD format war even started!

Nintendo ran away with a shiny gimmicky box that caters to children and elderly people. That's not called taking the prize, that's called betraying your fan-base and leaving them behind for the sake of money and disguising it as "games for EVERYONE".

cleverclogs said,
"...it are now..."
Grammar please!

Well, I plan on buying a WM7 phone in 2011, sooo, that's 1 of the 30 million.

Ditto, though I'm not going to wait till next year, I think i'll jump on whatever HTC does later this year.

Vice said,
Doubt it.

Agreed. WP7 is too little too late, and I personally am not too impressed with the design decisions they have made either.

Android and the iPhone are hammering WP7 in the market, and they have a long road to recover their market share.

Yep, and the Xbox will never be able to compete with the PS2. Microsoft shouldn't even bother getting into an area where they're so far behind.


Android and the iPhone are hammering WP7 in the market, and they have a long road to recover their market share.[/quote]

I don't see Android being superior to WP7 by the time WP7 is released. Android is choppy, sluggish and unpolished. Even on an N1, simple things like pulling down the notification shade and animating back to the home screen are extremely choppy. ZuneHD is already 10x smoother than Android. They really have very little work to do on top of ZuneHD to produce a device superior to any Android handset.

Subject Delta said,

Agreed. WP7 is too little too late, and I personally am not too impressed with the design decisions they have made either.

Android and the iPhone are hammering WP7 in the market, and they have a long road to recover their market share.

Your personal opinions on the design decisions do not correlate with its success. These reports are made by analysts who have a lot more information to access concerning these sales than you do, so rather than all these people who are commenting on this article pretending to be pseudo-analysts, please stuff it and move on.

These reports are only made public for the sake of shareholders and potential stock option purchases.

geoken said,

Android and the iPhone are hammering WP7 in the market, and they have a long road to recover their market share.

I don't see Android being superior to WP7 by the time WP7 is released. Android is choppy, sluggish and unpolished. Even on an N1, simple things like pulling down the notification shade and animating back to the home screen are extremely choppy. ZuneHD is already 10x smoother than Android. They really have very little work to do on top of ZuneHD to produce a device superior to any Android handset.

If you have never used Android, then you need to at least try it out. Not that, that could help you climb out of your ignorant stone age perception of superior operating system. A system that is now outselling iPhone OS. If this is true (and it is), you'll be one of few stuck believing that WM7 even has a chance in hell to ever catch up! .....it ain't going to happen.

Because.... first you have to have 3rd party developers developers developers developers..... writing apps for it. Right there is a major exodus from iPhone OS (mainly due to their own belligerence and arrogance, not unlike M$ and their fans here) of developers developers developers.... and even one top OS developer leaving Palm's WebOS. Where are they going? ....yeah that's right not WM7! ....Android and apps are what is driving Smartphone Sales right now!

Edited by monarky, May 31 2010, 11:42am :


Engadget clarifies that this 30 million number doesn't even account for other Microsoft-backed handsets, such as the recently released KIN lineup.

KIN only would have made a difference of 1-2 in terms of sale numbers :-)

zagor said,

KIN only would have made a difference of 1-2 in terms of sale numbers :-)

We'll have to wait and see what the KiN numbers (if we get them) are. MS might just count those as Windows Phone/mobile sales in the end, which they technically are.

I wonder why this is linked to Apple as Microsoft use horizontal integration rather than vertical. 30 million units sold by one brand one handset seems very high but not on many handsets.

I'm all for thinking big, but 30 million seems a bit unrealistic to me. But hey, I'm an idiot, so maybe they can pull it off.

COKid said,
I'm all for thinking big, but 30 million seems a bit unrealistic to me. But hey, I'm an idiot, so maybe they can pull it off.

In todays smartphone market it is, but the key is that in 2011 the overall smartphone market will have doubled in size, thus more smartphones well get sold compared to feature/dumb phones that still make the vast majority of sales today.

GP007 said,

In todays smartphone market it is, but the key is that in 2011 the overall smartphone market will have doubled in size, thus more smartphones well get sold compared to feature/dumb phones that still make the vast majority of sales today.

Correct. Also for Microsoft's sake, hope they got it right.

COKid said,
I'm all for thinking big, but 30 million seems a bit unrealistic to me. But hey, I'm an idiot, so maybe they can pull it off.

It's due to the fact that Blackberrys/Windows Mobile phones dominate the enterprise smartphone market and they plan on high corporate sells of their phones to inflate the number to 30 million. Phones such as Android or the iPhone are meant for personal use and will never be bought by a corporation.

SpecialK. said,

It's due to the fact that Blackberrys/Windows Mobile phones dominate the enterprise smartphone market and they plan on high corporate sells of their phones to inflate the number to 30 million. Phones such as Android or the iPhone are meant for personal use and will never be bought by a corporation.

I don't know about Android but I've read numerous reports that suggest that the iPhone is making inroads into the corporate market. Just yesterday AT&T released figures suggesting that quite a large percentage of their iPhone sales are going to corporate customers.

Also, Microsoft have clearly stated that they intend to target consumers rather than corporations with the initial release of Windows Phone 7. The new OS will include some features that make more sense on a corporate network (e.g. Sharepoint integration) but the focus on media and social network is clearly designed to target a consumer market.

Jebadiah said,
Correct. Also for Microsoft's sake, hope they got it right.

....right, becase Microsoft totally has nothing else going for it, like the XBL/Media Center ecosystem, the Windows operating system, the server architecture, their current Windows Mobile system....do I need to go on?

This is a drop in the water.