Following Microsoft's preview of Windows Phone 8 on Wednesday, the potential impact of this major new component in the company's overall platform strategy is still being assessed.
Key issues include the ecosystem for third-party apps, the effect on the company's alliance with Nokia, and the meshing of Windows Phone 8 with the coming Windows 8 OS for tablets, laptops and desktops.
The new Phone 8, expected to launch in the fall, will only run on new devices. This means that it will not run on Nokia's current lineup of Windows Phone 7-based Lumia devices, whose sales had been seen as key indicators of whether the phone maker's decision to abandon Symbian for Microsoft's phone platform was a good idea.
Nokia, Windows 8
Nokia says it will try to offer some of the new features that will be available in Windows Phone 8 to Lumia users, including a better camera, a tile-based interface that resembles Phone 8, and Zynga games.
But many industry observers expect that Nokia's sales of the Lumia could stall, as prospective buyers wait for the new Phone 8 devices to come out. Already, Nokia is showing the costs of its transition. Its revenue for the first quarter of this year plummeted 52 percent year-over-year, and its global market share fell from 25 percent to about 20 percent over the last year. Samsung is now the world's largest handset maker, replacing Nokia in that position.
Current Analysis' Avi Greengart described the transition to Windows Phone 8 as "short-term pain for long-term gain" for both Nokia and Microsoft. "It's not like the Lumia line has been setting the world on fire," he noted, adding that it's in Nokia's long-term interest to have a better application ecosystem.
Greengart pointed out that, as expected, Phone 8 appears to be "a stripped down version of the full Windows 8," which brings various "PC benefits" to those phones, such as support for DirectX.
'Enormously Risky Move'
The kinship to Windows 8 also points to a better ecosystem for application development, Greengart said, because third-party developers will be able to code their apps and then compile them for either a phone, a tablet, or a laptop -- with adjustments made for screen size and interface. "The code base can remain the same for the different devices," he said, "because it's one platform."
For businesses, he said, this could mean a large retailer develops an e-commerce solution that utilizes the same programming across the range of computing and communication devices. Greengart added that this could result in the creation of a variety of multiple-device apps that simply do not have counterparts on either Apple's iOS or Google's Android platforms.
But this "enormously risky move" to the new platform by Microsoft, he added, doesn't mean that consumers and businesses will buy Phone 8 devices. Greengart pointed to the very real possibility that potential buyers will "see this as yet another shift by Microsoft," which had been pushing Windows Phone 7 and Windows 7. Consumers and businesses may just throw up their hands, he said, "and choose to move to Apple or Android."