Verizon’s Increasing Product Portfolio to Benefit Microsoft

Rajesh is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

Verizon Wireless (NYSE: VZ), the nation’s largest carrier, will be offering Windows Phone 8 devices running on Microsoft’s (NASDAQ: MSFT) operating system in the fourth quarter. The Big Red hasn’t been an active partner of Microsoft and the Windows Phone platform; however the WP8 is making its way to the carrier’s network in the fourth quarter. The only Microsoft-powered mobile that the carrier offers is HTC Trophy. Microsoft has been working hard to promote Windows 8 particularly as the competition from the iPhones and the Androids is getting fierce.

Several carriers have assured their support to the Windows Phone, but the top carrier’s confirmation to participate in offering multiple Windows Phones is of great essence. So far, AT&T (NYSE: T) and T-Mobile have been the only carriers who have actively supported Nokia (NYSE: NOK) Windows Phone devices. AT&T did a pretty decent job in marketing the Lumia 900 in US when it released. As per rumors there are high chances that AT&T would yet again be the first carrier to bring the new Lumia in the nation. However, things might be a little different with the entry of the lead carrier.

Essence of the top carrier’s participation
In the face of fierce competition in the smartphone arena, it is extremely essential to receive support from the leading carrier which provides a huge customer base. It is really important for Microsoft to have Verizon in its cards to offer the Windows Phone, so that it is able to compete in the smartphone market which is dominated by Apple’s (NASDAQ: AAPL) iPhone and Google’s Android. While Google’s smartphones continue to lead in the US with a market share of 52.2 percent, Apple owns 33.4 percent of the US smartphone market. However, as per comScore’s latest Mobile Subscriber Market Share report the Cupertino company, known for launching trendsetting devices, is experiencing a faster growth in market share. Apple’s market share rose by 2 percent while Google Android’s share increased by 1.4 percent. In fact, the tech giant finally released the most awaited device this fall, the sixth generation iPhone the iPhone 5. At such a juncture, Verizon’s willingness to add Windows Phone to its wide range of offerings is indispensable for Microsoft.

Verizon hasn’t disclosed details regarding the models it would be providing or the manufacturer it would deal with, even though Microsoft and Nokia introduced two Lumia handsets on Wednesday. Nokia has been the major brand for Windows Phone 8, while others include Samsung, HTC and LG. On being questioned that if the phones are Nokia made, the wireless provider vaguely replied that they propose to work with Nokia, but didn’t elaborate on its further course of action. The carrier looked pretty impressed with the way Nokia has worked on the design, color and the portfolio of accessories, but believes that it still needs to work further to get into the US market. Nokia, that flaunted its flagship Lumia 920 and the lower end model Lumia 820, refused to reveal information with regards to the carrier that it would partner with for its phones. The company which was once the world’s largest handset maker, now holds just 7 percent of the global smartphone market share. In fact its grip in US is even less which stands at a mere 2 percent as per International Data Corp. However, with the assistance of Verizon, Nokia too stands to gain.

Concluding thoughts
Verizon plans to expand its product portfolio. It also revealed some good news for Blackberry lovers, saying that it would offer Blackberry 10 once the smartphone releases in Q1 2013. While the carrier wishes to benefit from widening its portfolio, its attempt to offer the Windows Phone 8 devices would be of great assistance to Microsoft. Supporting WP8 would help Microsoft to fight the extremely competitive smartphone market, as well as assist Nokia to improve its foothold in the lost arena. The question is how beneficial it would actually turn out to be. The answer lies in the number of people who would actually turn up buying the Microsoft powered smartphones.


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