October 08, 2010, 10:40 PM — Microsoft will unveil devices running its new Windows Phone 7 operating system for the first time Monday at an event in New York that some experts predict will be a make-or-break product launch.
They aren't exaggerating.
Analysts say Microsoft's success with Windows Phone 7 (WP7) is important to its mobile initiatives as well as to the overall future prowess of the software giant, which is best known for its desktop operating systems and office productivity software. Analysts regard the WP7 announcement as important to the entire company.
"On a scale of 1 to 10, this announcement is an 11" to both Microsoft in mobile and Microsoft overall, said Ramon Llamas, an IDC analyst. "This is where the rubber meets the road. It's huge."
Microsoft must prove it has overcome its dismal performance with the current Windows Mobile OS and the failure of a youth-focused Kin phone line that launched in the spring but was killed two months later.
More daunting is how well WP7 can distinguish itself with consumers against Apple's iPhone and an array of Android devices, as well as the persistence of Research in Motion's BlackBerry smartphones with the corporate crowd.
"With WP7, Microsoft is trying to catch up to everyone else in mobile," said Zeus Kerravala, an analyst at Yankee Group. "In many ways, I think they've missed the mobile window, not to play with words. Windows Mobile has left a bad taste in people's mouths and, now, trying to get customers to try Microsoft and WP7 again will be difficult, especially with the popularity of Android and Apple."
Microsoft needs to replace those failed products with a "cool and sleek" set of WP7 devices "that will draw people in," Llamas said.
Microsoft is being quiet about the final lineup of devices that will be shown Monday, although a spokeswoman said there will be devices -- plural -- shown by Microsoft with AT&T, after a press conference with Microsoft CEO Steve Ballmer and AT&T Mobility President Ralph de la Vega. And Microsoft has not restricted itself to smartphones; some observers expect more news on Microsoft's plans for tablet computers.