There may not have been hordes of people camping out at AT&T (T) stores around the country over the weekend for Sunday's debut of the Lumia 900 -- a Nokia (NOK) smartphone. But there's plenty riding on the $100 device, especially for Microsoft (MSFT).
Lumia 900 is the flagship phone of Microsoft's fledgling Windows Phone, the mobile operating system that Microsoft hopes hasn't arrived too late in the game to take on Google's (GOOG) Android and Apple's (AAPL) iOS. And consumers may indeed quickly warm up to a device, despite its currently unpopular mobile operating system. Here's why:
1. Microsoft Is Pouring Billions Into Promotion
When Nokia agreed to crank out a series of handsets based on Windows Phone last year, CEO Stephan Elop boiled it down to money.
"The value transferred to Nokia is measured in Bs not Ms," Elop said at the time, implying that Microsoft was paying the Finnish handset maker billions -- not millions -- to back Windows Phone. Lumia 900 may be the flagship smartphone, but there will be a lot more models rolling out in the coming months and years.
It's not the only way that Microsoft is paying up to make sure that the Lumia 900 gets noticed. Beyond the heavy in-store promotion within AT&T centers, Microsoft also launched a celebrity-backed "Free-Time Machine" campaign where it will reward 200,000 instant prizes through select city initiatives and a new FreeTimeMachine.com website.
2. It Gives On-the-Go Workers an Office Suite
There may be a lot of people with cynical opinions when it comes to Microsoft, but its Office productivity suite is the top dog in its field.
There's a good chance that you deal with Word, Excel, or PowerPoint documents on a regular basis. Sure, there are plenty of third-party apps on other smartphones that let you work with those documents, but this is the only platform with an Office Hub that lets users seamlessly manipulate the files on their phones.
Despite all of the rumors of Microsoft offering Office for iOS -- something that may very well happen -- the Lumia 900 is being pitched for the premium productivity that is built into the handset.
3. Microsoft Is Greasing Developers
"There's an app for that," has been one of the rallying cries for the iPhone. The handsets aren't cheap. The wireless carrier data plans are expensive. However, iPhone owners know that they have access to hundreds of thousands of applications -- and many of the good ones are available for free.
Many developers were initially hesitant to support Android, but the popularity of the open-source platform created an audience that was too large to ignore.
If developers had any say in this, that would be it. Why port a hot title to as many mobile operating systems as possible? Having dedicated teams for different devices, and their perpetual updates, doesn't come cheap.
Microsoft knows this, and that's why it's making sure that it now has many popular applications among the 70,000 it currently offers during this week's launch. According to The New York Times, Mr. Softy is cutting checks to help offset some of the development costs that run between $60,000 and $600,000.
Love Angry Birds? No problem. It's coming too.
4. Gamers are Going to Love This
Sony (SNE) tried to blend mobile with gaming when it teamed up with Ericcson to put out the Xperia Play smartphone last year. The handheld gaming device it introduced domestically earlier this year -- PS Vita -- pitches the mobile element of on-the-go gaming.
Sony hasn't gained a lot of ground with either product; the same can be said about Sony's gaming presence now that Microsoft's Xbox has become the platform of choice.
Xbox LIVE is a built-in feature of Windows Phone.
For now, that means little more than checking out achievements and Gamerscore tallies. Xbox LIVE subscribers can also see when their friends go online. An Xbox Companion app promises to let Lumia owners control their consoles, but likely in a limited fashion.
However, with tens of millions of Xbox LIVE subscribers, a phone that connects gamers to their diversions is obviously going to help Microsoft.
5. The Price Is Right
Selling for half as much as the cheapest iPhone 4S -- even if it's tethered to the same two-year contract through AT&T -- is also going to boost sales.
Microsoft has more than just its reputation at stake here. It means business, and it's willing to cut big checks until it succeeds.
Motley Fool contributor Rick Munarriz does not own shares in any of the stocks in this article. The Motley Fool owns shares of Microsoft, Apple, and Google. Motley Fool newsletter services have recommended buying shares of Nokia, Apple, Microsoft, and Google. Motley Fool newsletter services have recommended creating a bull call spread position in Microsoft. Motley Fool newsletter services have recommended creating a bull call spread position in Apple.
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