A Windows Phone-CES Post Mortem

I attend the Consumer Electronics Show (CES) to follow and cover Microsoft, both in terms of its announcements at the show, and those of its competitors. From that standpoint, and since Microsoft announced that this year’s CES would be its last, I attended again this year and I think it was the best CES Microsoft’s had since I started attending. But the reasons for that are unexpected and surprising. Let me give you a little more context and explain why.

Microsoft has, since 1998, delivered the kickoff keynote for the entire CES conference, and has typically used it to make important announcements. For example, when I attended my first CES in 2009, Microsoft used the keynote to announce the the Windows 7 beta. The company has also used past keynotes to show off Project Natal (which became Kinect) and at last year’s kickoff, Microsoft announced Windows on ARM.

So over the fall, I expected big things from this year’s keynote, like the Windows 8 beta announcement and/or something around the "Tango" or “Apollo” releases of Windows Phone. But in the run up to the show, we learned that the Windows 8 beta wouldn’t be out until February, we got fairly clear indications that Windows Phone technology announcements wouldn’t be on the agenda and then Microsoft announced that 2012 would be its last year at CES.

Correspondingly, I expected very little out of the Microsoft keynote. And in terms of news, very little is what we got. I mean, sure, Ryan Seacrest anchored the event, and there was a roster of smaller announcements (if you want, you can read about them in my special Redmond Roundup @ CES dispatch). But the keynote’s Windows Phone, Windows 8 and Xbox/Kinect demos were basically encore presentations from the Windows Phone 7.5 launch, //build/ and E3.

But somehow, things seemed to come together for Microsoft at this CES. To begin with, Nokia announced its Lumia 900 Windows Phone handset, for release this Spring on AT&T. It did so at its own, somewhat low-key press conference downstairs from, and a few hours before, Microsoft’s keynote. The phone looked great and response was very positive. Nokia also made official the immediate availability of the Lumia 710 on T-Mobile USA for $49.99. Steve Ballmer joined Nokia’s CEO Stephen Elop on stage for part of this press conference, and I think it was pivotal for Microsoft.

I didn’t really appreciate that fully until during the show. Nokia’s booth was very busy, and its Windows Phone handsets were everywhere. Even at the displays where Nokia was showing its mobile audio accessories, the sound sources were 710 and 800 handsets. It’s as if the company were changing its name from Nokia to Lumia.

Lumia represents much more than robust support for the platform by an OEM. When I went by the booth and watched a few demos, I realized that Nokia’s Lumia 800 and 900 phones don’t just run Windows Phone, they transform it. The software doesn’t change, mind you, but the context has changed completely. Those handsets are so elegant, and Nokia is so unequivocally committed to Windows Phone, that suddenly it shines. Pride replaces caveats, beauty replaces clunky-ness, excitement replaces postponed hope and, for the attendees of CES, interest replaced cynicism and condescension.

With Android receding to hum-drum, commodity status at this CES and the iOS ecosystem devices seeming less prominent as well, Windows Phone seemed to have the “it” status. No wonder Joe Belfiore, Brandon Watson and others from the Windows Phone team looked so happy at the keynote.

And perhaps most interesting, that Windows Phone buzz seemed to have created anticipation around Windows 8. It’s long been my suspicion that, when released, Windows 8 will lend gravitas and momentum to Windows Phone. But I never really considered that this booster effect could work in both directions. Add-in the “Ultrabook” laptops displayed by a number of vendors at CES, and things are looking surprisingly positive for Microsoft. And all this during its final, understated year at the show.

Microsoft’s CES keynote did do one thing quite boldly: it presented Metro as the company’s key value proposition. That makes a lot of sense. Metro is non-derivative; it builds on Microsoft’s versatility across contexts (work at the office, gaming/entertainment in the living room and a combination of the two while mobile); and with the right partners having the right focus, execution can be elegant, compelling and open.

Redmond still has a huge fight on its hands, but it seems to be finding a certain peace with itself, building good technology, letting its partners do the talking, providing value to the enterprise and proving its mettle at a consumer event. Now it needs to sustain this momentum, and continue to be patient.

Posted by Andrew J. Brust on 01/12/2012 at 6:40 PM