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Microsoft’s Ballmer Sees Windows Phone Update in March

Microsoft Corp. will release the first Windows Phone 7 update in early March, Chief Executive Officer Steve Ballmer said.

The operating system, which got a boost last week after Nokia Oyj said the platform would be its primary mobile-phone software, will get features this year such as Internet Explorer 9, Twitter and multitasking capabilities, Ballmer said today at the Mobile World Congress in Barcelona, Spain.

“Increasingly, consumers, developers and mobile operators won’t just choose a phone, they’re really choosing a platform,” he said.

Microsoft is pulling out all the stops to reverse market share declines in its mobile-phone software as smartphone sales are estimated by analysts to pass personal computers in the next two years. The deal with Nokia, the world’s biggest maker of handsets, is a bet the two companies together can challenge Apple Inc. and Google Inc.

Nokia Chief Executive Officer Stephen Elop, a former president of Microsoft’s business unit, said his company will get “billions” in benefits from the partnership. Andy Lees, president of Microsoft’s mobile division, declined to tell analysts exactly how much Microsoft will pay. The agreement involves the transfer of revenue from search, advertising, geographic-location services and royalty payments, he said.

Microsoft released a complete overhaul to its mobile operating system last year. Called Windows Phone 7, 2 million copies of the program were shipped in its first quarter on the market, a number analysts termed disappointing.

Brand Awareness

Microsoft said last month that customer satisfaction for the product is at 93 percent and brand awareness jumped 22 points to 66 percent since the release. The Redmond, Washington- based company is now trying to add features and get the product in the hands of as many customers as possible.

Microsoft’s share of the smartphone operating-system market declined to 2.8 percent in the third quarter, from 7.9 percent a year earlier, according to Gartner Inc. The share of Google’s Android platform rose to 25.5 percent from 3.5 percent, while Apple’s iOS share declined to 16.7 percent from 17.1 percent.

Phones with the new Microsoft software went on sale Oct. 21 in Europe and Nov. 8 in the U.S.

To contact the reporter on this story: Matthew Campbell in Paris at mcampbell39@bloomberg.net.

To contact the editor responsible for this story: Vidya Root at vroot@bloomberg.net

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