Microsoft's $1 billion smart phone bet? That's chump change

August 29, 2010 - 0:0

Microsoft is rapidly developing Windows Phone 7, a smart phone platform to compete with iPhone, Android and BlackBerry. It's due this fall, though we don't yet know the dates, prices and carriers. We do know one thing, the launch will be massive. Like billion-dollar massive.

To be sure, Microsoft isn't starting from a comfortable position here. By killing off its earlier smart phone OS, Microsoft signaled that it's willing to fight to the death (in this market). And it's starting the fight on its back. So, how much is this insane mobilization going to cost the one-time alleged monopolist? A billion? More?
TechCrunch cites Deutsche Bank telecom analyst Jonathan Goldberg, saying that the company will spend $400 million on marketing alone this year. The total spent out of Microsoft's pocket could top $1 billion including development. Goldberg is quoted saying that he was told that between Microsoft and its carrier and hardware partners, ""billions"" would be spent.
Super-keen Microsoft watcher Mary Jo Foley says a billion ""would be a small price to pay"" for Microsoft to get back in the game, citing its $62.5 billion 2010 revenues and its increasingly noticeable ""lack of a credible and coherent answer to the iPhone and Android.""
(Msnbc.com is a joint venture of Microsoft and NBC Universal, but nobody is telling us how much the company is spending on its Windows Phone 7 launch.)
So, what does a billion dollars mean in the wireless world? A few years ago, it might have been significant, but now, it's just pennies in a very large pig.
(Source: Msnbc.com)