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Did Microsoft Repeat the Mistakes of the Past with Windows Phone 7?

Ahead of the introduction of nine smartphones sporting the spanking new Windows Phone 7 operating system, the reviews are starting to come in. Whether that’s good or bad for Microsoft is an open question, but some serious shortcomings have already surfaced, and it reveals the major flaws in the company’s approach to product development and marketing.

So the new interface, emphasizing tiles over icons and folders, has gotten extremely positive ratings for the ease of navigation, or at least until there are actually decent numbers of apps available on the new platform. Ditching the errors of the past, mostly trying to replicate the traditional Windows interface on a tiny gadget, was a good thing. No doubt about it.

However, Microsoft’s leadership clearly hasn’t learned from the mistakes of the past, meaning they do not comprehend the sad truth that being almost as good doesn’t cut it in a hotly competitive market. This is not the PC OS wars being replayed.

In those days, it was mostly Microsoft and Apple, with the lesser players tossed by the wayside, except, of course, for the various iterations of Unix. With a major focus on the business market, Microsoft kept promising that yesterday’s and today’s Mac OS features would appear in next year’s Windows upgrade (whether true or otherwise). So there was no sense switching, they said, because Microsoft would take care of you.

For Windows, it worked, more or less, although the sales of new Macs these days are growing much faster than those of most PC makers. Apple has always emphasized consumers, but they are looking more and more towards the enterprise. This is particularly true as corporate executives bring in new Macs and demand that their IT departments live with it. The PC is stagnating, other than needed replacements for older hardware. Netbooks are faltering.

The problem is that Microsoft never learns from their mistakes. Take the Zune music player. Microsoft emulated Apple’s closed ecosystem, double-crossing the company’s PlaysForSure partners.

To be perfectly fair, the Zune, with which I’ve had brief encounters, seemed decent enough in most respects. It was certainly a credible alternative to the iPod, but Microsoft always seemed to be stuck in the rear view mirror, as if they took an older model, spent so much time duplicating the fundamentals, and adding an extra bullet point feature or two, that a new model was already on the market. What about predicting what next year’s model should be?

The public decided they didn’t want to get with the “Social,” Microsoft’s clumsy effort to make the Zune seem relevant to young people. So while the Zune theoretically remains in the product catalog, it hasn’t gone anywhere. Oh, yes, Microsoft is evidently working on a sync app that will let the Zune, and a Windows Phone 7 device, sync with iTunes. Nothing wrong with that.

As to those Windows Phone 7 gadgets, it appears Microsoft has one reasonably clever idea, which is to have a separate camera button. That saves a few seconds if you want to grab a quick snapshot of a family member, special event or, perhaps, even something in the sky that appears to be a UFO. But I’m getting ahead of myself here.

Unfortunately, the operating system itself appears closer in concept to iOS 2 than iOS 4, or the forthcoming iOS 4.2. There is, for example, no support for cut, copy and paste, which Microsoft promises will appear in a software update next year. Forget about multitasking for third-party apps, though it does appear you’ll be able to listen to music from the Zune app while doing something else. And don’t get me started about the slightly awkward name.

As I said, Microsoft is still using the rear-view mirror.

The problem here is that Microsoft isn’t persuing the smartphone market from a position of strength. The same was true for the Zune, and Windows Phone 7’s fate may be similar. Don’t forget the Kin smartphone, which Microsoft killed within weeks of its highly unsuccessful introduction.

The smartphone market today has delivered great sales for Apple, Google’s Android partners, and RIM. The first two are the hot tickets, and Microsoft is a serious also-ran. When someone enters a consumer electronics store, or one of a carrier’s factory outlets, they will have loads of terrific gear with which to compare a Windows Phone 7 product.

Worse, Apple has over 300,000 selections in the App Store. Google has over 100,000, although some will argue that far too many are minimalist apps that do nothing more than play ring tones or make unsavory sound effects.

Regardless, big bad Microsoft is resuming this game with something that’s not only incompatible with previous Windows smartphones, lacks some of today’s key features, and supports a mere 1,000 apps or so. It’s going to be a chicken or egg situation, where developers won’t commit resources to a new platform unless they get a big dose of persuasion by Microsoft, or see potential profits.

When it comes to profits, the biggest gains still come in the Apple App Store, despite all the competition.

This isn’t to say Microsoft is doomed to fail yet again with its latest and greatest smartphone OS. They do have loads of existing business customers who might prefer a product that offers superior support for Exchange and Office products. That could provide a core of Windows Phone 7 support that will keep the product going, but when it comes to competing with the larger players, that train may have already left the station.