Bill Gates: Microsoft Isn’t ‘The’ Leading Company Because of Windows Phone

Posted on June 24, 2019 by Mehedi Hassan in Microsoft with 46 Comments

In a recent interview, Microsoft founder Bill Gates discussed Microsoft’s business and one of its biggest mistakes: Windows Phone. Gates stated that his biggest mistake ever was the mismanagement he engaged in that led to Microsoft not being what Android is.

Gates later went on to state that there’s only room for a single non-Apple operating system in the market, and having half the apps or even 90% of the apps would have a company on its way to “complete doom”. That was obviously the case for Microsoft, with the lack of modern apps continuing to be a problem for the company’s platform even today.

Bill Gates even put a value of $400 billion on the Android business, which just goes to show how much of a big market Microsoft missed out on. There really is no point in discussing history anymore though, and we all know about the 8-10 years that led to the disaster Microsoft’s mobile business was as compared to Google’s Android and Apple’s iPhones.

Gates did, however, note that Microsoft’s Windows and Office assets continue to be very strong even after its biggest mistake that was Windows Phone. “It’s amazing to me that having made one of the biggest mistakes of all time, that our other assets Windows and Office are still very strong. So we are a leading company, but if we had gotten that one right, we would be the leading company”. Ouch.

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Comments (46)

46 responses to “Bill Gates: Microsoft Isn’t ‘The’ Leading Company Because of Windows Phone”

  1. Atoqir

    Well too late now. There is no point coming back at this point.

    That is also what he basically says in this interview.


    Whatever comes next, it will always be the next evolution on smartphones/mobile. So MS will always be so much behind compared to Apple and Google.


    But it changed MS for the better. They are now more open and multi platform than ever before. I know it is out of necessity but it is great nonetheless

  2. PeteB

    > There really is no point in discussing history anymore though


    Disagree. There's definitely a point discussing since Microsoft continues to make the same mistakes over and over, never seeming to learn.

  3. illuminated

    The old Windows Mobile killed palm and quite possibly it was one of the reasons why windows phone failed. There was just no urgency to introduce the mobile OS that supported touch and when Microsoft finally released Windows Phone 7 it was just a bit too late and with updates coming out real slow.


    With all that I loved windows phone. It was the best smartphone that I owned. Now I am on Android and I have the apps but OS is a bloated messy OS that cannot even send SMS messages right. But it can notify me about every crappy spam sale there is.

  4. macgeek74

    Windows Phones were actually great and better in many areas but they failed because third party developers were lazy. Because of that, people were never going to give Windows Phone a chance because they could not live without certain apps. The same thing happened to WebOS and Blackberry OS which were amazing operating systems. Canonical realized this and pulled the plug on Ubuntu their mobile operating system. We need more than just two operating systems for innovation. Just wish certain major developers would realize this.

    • hrlngrv

      In reply to macgeek74:

      All those lazy developers leaving US$ hundreds of millions unearned. /s

      Please! The return on effort wasn't there.

      Maybe the real parties at fault are smartphone buyers, 98% or more of whom just weren't willing to buy Windows phones.

    • skane2600

      In reply to macgeek74:

      Microsoft approached the Windows Phone as if they were peers in that market rather than the underdog they actually were. So they didn't deal with carriers aggressively (i.e. didn't pay them to feature their phones) and they wanted the same cut from developers that Apple and Google were getting. They should have waved both the registration fee and their cut for the first year or two.


      On top of that, in support of their ill-fated goal of "One Windows" they pulled the rug out from under the developers they already had by creating UWP and making it the new standard which meant that apps that adopted that standard couldn't run on the vast majority of existing Windows Phones thus splitting their already tiny market in two.


      Pretty much all of Microsoft's trouble with Windows Phones were self-inflicted

  5. sevenacids

    Maybe he is also a little pissed that he sold quite a lot of his MSFT stock before the Nadella uptake. He'd be richer than Bezos right now if he didn't. Well, that sucks, Bill.

  6. blackcomb

    The last time Microsoft got it right was with Windows 7.

  7. dontbe evil

    Gates: "In the software world it's very particular for platforms… These are winner-takes-all markets. So the greatest mistake ever is whatever mismanagement I engaged in that caused Microsoft not to be what Android is. That is, Android is the standard phone platform – non-Apple platform. That was a natural thing for Microsoft to win,"


    Thurrot/Hassan: "Bill Gates: Microsoft Isn’t ‘The’ Leading Company Because of Windows Phone" , "Gates did, however, note that Microsoft’s Windows and Office assets continue to be very strong even after its biggest mistake that was Windows Phone."

  8. yaddamaster

    It's pretty obvious that Gates isn't knocking his role - he had almost nothing to do with Microsoft's colossal ineptitude during this time. Ballmer became CEO in 2000. Ballmer was the one responsible for the disaster and distraction that was Longhorn. Ballmer was the one responsible for Vista. Ballmer was the one who continued to insist on windows mobile and laughed at the iPhone. Ballmer was the one who slapped a skin on mobile 6.5 and thought it would be enough even as Android started to take MS to the cleaners.


    Ballmer was the one screaming like an idiot "DEVELOPERS!!! DEVELOPERS!!!!!! DEVELOPERS!!!!!!!!" when developers had already figured out he didn't have a clue what he was doing.


    Ballmer was a brilliant #2. A marketing genius. As a CEO he utterly failed. Any market share or market cap increases were despite him and not because of him - all due to the brilliance of Gates.

  9. eric_rasmussen

    The company was so siloed in those years, with so much in-fighting between teams that it's no wonder they couldn't pull anything like mobile off. It wasn't the engineering teams though, they had some of the best and brightest in the industry. I blame HR. They used to have a system called stack ranking where you must have some percentage of low performers, a bunch in the middle, and a small percentage of high performers. Even if you had a team of super stars who all believed in the company and worked their butts off, as a manager you had no choice but to write some of them up on a performance improvement plan.


    This idiotic idea came from GE originally I believe, with the idea that moving people around teams and firing 20% of your employees every year was somehow good for the company. Which is why GE is a leading company these days too. ?


    Microsoft's HR department of the 90's helped feed Google some of the most passionate and talented people Microsoft had. Google understood that happy employees are productive employees and the rest is history.

  10. Patrick3D

    While Windows Mobile was a nightmare best left forgotten, it sure seemed like the service providers were determined to kill Windows 8/10 based phones no matter what. Lack of Verizon support was the deal breaker for me. Guess they lost too much money with previous efforts from Microsoft in the phone arena. I do wish there was a 3rd contender, I don't care to do business with either Apple or Google.

    • hrlngrv

      In reply to Patrick3D:

      It wasn't active ill will. Carriers were indifferent to Windows phones.

      When did Verizon not sell Windows phones? OTOH, when did Verizon ever make it easy to buy any phone from anyone else but use it on Verizon's network?

      As for only 2 options, not unusual: consider VHS and Betamax. Besides, a #3 phone OS with at least 5% worldwide user share may be possible, but that's not large enough share to interest MSFT, Amazon or any player with worldwide reach. Until there are a ton of PWAs and most phone users using PWAs instead of traditional phone apps, I can't see a 3rd mobile OS able to establish itself.

  11. Bats

    The biggest mistake that Microsoft made, with regards to Windows Phone, was their own over-valuing of the Windows OS and Office product. Plain and simple...that's it.


    I remember Bill Gates saying (and I paraphrase) "People are frustrated. They want to use Office....."  


    Clearly, years after that statement was made, it's proves to be not true. 


    I have said this before and I'll say it again, Microsoft failed to create a viable ecosystem for Windows Phone. Where Apple and Google were creating services for music, video, gaming, productivity, information, etc.... Microsoft created half baked equivalents. 


    As for Bill Gates talking about mis-management. Please Bill, I've heard it all before. Was there mismanagement for Microsoft Money? Photodraw/PictureIt? Zune? LOL....Continuum? 


    Clearly, ya can't be a market leader if you R&D Department is Google and Apple. 


  12. glenn8878

    Microsoft under Ballmer bought companies that he didn't know what do with. He tried to buy itself a win against Google and failed. He bought several mobile companies and failed. Microsoft should be the Developer everyone aspires to become, but they didn't know what they are doing. Platforms should be it's bread and butter since they knew how to evolve Windows successfully, but they stumbled each time it tried to accommodate the latest trend. Windows cannot be all things to everyone yet they always find a way to merge it into failure. Merging Windows Phone 7 into 8 was a huge mistake. It lost a lot of momentum. Merging Windows 8 into 10 was a huge mistake. Windows 8 as the tablet interface should be in it's own track. Windows 10 should be a desktop computer. Unification means disintegration.

  13. Andi

    You can't win them all. Maybe it was MS' turn to have a historical downturn like Apple itself had in the past. Anyway, MS shouldn't lambaste itself so much. They forget that Android had inside access to Apple's mobile plans through Eric Schmidt.

    • PeteB

      In reply to Andi:

      Well, Microsoft had a huge headstart with Winmobile before iPhone even existed. Years before. But as usual their complacency, arrogance and monopoly-mentality opened the gates for others to do a mobile phone right.


      I'll never forget a cackling Ballmer when iPhone was announced .. people will never buy that!" What a dope.

      • hrlngrv

        In reply to PeteB:

        In fairness to Ballmer, RIM/Blackberry also utterly failed to comprehend the full implications of the iPhone. Both MSFT and RIM (and Palm) were selling shirt pocket computers which could make phone calls in the mid 2000s, and they failed to see the potential of consumer smartphones.

      • skane2600

        In reply to PeteB:

        Microsoft had a head-start going down what would become the wrong path. A future refinement of Winmobile would have been unlikely to resemble an iPhone had the iPhone not come along.

  14. red.radar

    The reason Microsoft failed in windows phone:

    1. Android was free.
    2. Windows Phone was too late



  15. skane2600

    I think there were two main reasons why Microsoft failed at mobile. The first early mistake was a lack of vision. They made their mobile OS's mirror the full Windows UI too closely - scrollbars and styluses instead of a finger-touch interface. Apple didn't try to make a "Pocket Mac", but instead thought about how a mobile device should work.


    The second problem was related to the first: Microsoft tried to (sort of) merge mobile with the desktop in Windows 8 resulting in a mobile platform that was anchored to desktop Windows and a Windows desktop that was anchored to mobile The result was a less than optimized mobile platform and a desktop platform that unnecessarily annoyed their core constituency. Having missed the opportunity to get to an iPhone like UI before Apple did and falling behind Android, their efforts might have failed regardless of what they did, however.


    • hrlngrv

      In reply to skane2600:

      1st point perhaps more subtle: there were Pocket PCs back in the 1990s. The first Windows phones were Pocket PCs with phone features added rather than phone-first devices.

      2nd point: MSFT tried for FORCE PC users to get used to the Windows Phone launcher UI. I blame that on the people in charge at the time who had forced the ribbon UI on Office previously. MSFT believed they could leverage their position in PCs to force its way into the smartphone market. MSFT was rather spectacularly wrong about that, mostly annoying PC users and failing to secure a beachhead in phones.

      • skane2600

        In reply to hrlngrv:

        Yes, I was aware of and owned a Pocket PC, which is why I mentioned a "Pocket Mac" as an analogous device that would have been a mistake for Apple to base their phone on.


        Yes, as I said there was an unnecessary coupling between the desktop and mobile which harmed them both. I have no idea if the mobile strategy was cooked up by the same people who came up with the ribbon UI.

      • CaedenV

        In reply to hrlngrv:

        Have you gone back in time (or used libra office) and tried using modern office features without a ribbon UI? No thank you! It was an annoying adjustment at the time, but you could not pay me to go back.

        And the WP7+ UI is also really clever, but just lacks customization. I mean, I hate the Android launcher... but I can install whatever launcher I want on my phone, so it is not a big deal. MS needed to learn to have a good default, but allow a platform for others to grow on.


        But the thing that really killed WP/Win8 was metro. Not the UI, but the underpinnings behind it. Metro was called metro because it was supposed to be a metro system within the OS to shuffle data between apps. It was supposed to standardize how data was categorized, tagged (xml) and handled so it could move seamlessly between applications without the need for a centralized file system (even though there was a file system behind it all, just not available to the user or the apps).

        The down side to this is that developers could not silo their data in the same way that they could on other platforms. It was the PC way of thinking applied to a mobile platform, in a time when developers wanted their data to stay within their apps, and to charge others for access to that data through an API. There was no buy-in, so then MS kept changing their app platform and APIs which kept developers away because every 'update' broke the previous ones. No developer buy-in, no apps; no apps, no 'killer app' to bring people to the platform; no people and you have a dead platform.


        On the corporate side, there was no buy-in by Gates and others on the board to push it to the consumer markets. Windows Phone was making money hand-over-fist as a patent generating machine. Most things in mobile were first figured out on WP, and MS made patents left and right, making more money on most android devices than Google, or the manufacturer. Without much support, or peskey customers, or development costs, MS was bringing in free money... in their mind they were winning and did not understand that the app stores would grow like crazy and bring in the real money to their respective platforms. It was short-sighted.


        UI being ok or not really does not matter in the grand scheme of things. Apple had/has one of the worst mobile UIs in the world, and people adapt and get accustomed to it. WP was not perfect, but it was a very consistent and intuitive UI. Android... well, pick your flavor; it is a hot mess.

        What makes a platform successful are getting businesses and developers to make great apps and to push your platform. 2 groups that MS repeatedly ignored for 6 years. So they lost the war on mobile.


        The real question though, is what would have happened if MS was successful in mobile. If MS was merely another Google/Android, then they may not have had the motive to become so big in the cloud. And sure, Amazon is bigger in the cloud space, but MS has grown quickly, has more integration, and is making more money per customer. If MS became big in the consumer space, as much as I hate to admit it because I have been burned several times by MS's consumer products, they probably would be doing worse today than they are.

        • Michael Rivers

          In reply to CaedenV:

          No, metro was called metro because it resembled the signs in metro stations. A quick Google search shows lot of references.

        • hrlngrv

          In reply to CaedenV:

          I use LibreOffice Calc a bit, as well as Google Docs and Zoho Office in addition to Excel, Access and Outlook. I mostly use Excel and Access, and for Excel I very much prefer the classic menu. So much so that I've implemented it in my own QAT, e.g.,

          (old image from Excel 2010, but works the same in all subsequent versions).

          Even so, I don't use it much. I use the classic keyboard shortcuts supplemented with a fair number of Application.OnKey keyboard remappings. For me, the ONLY useful ribbon tab is Page Layout. All the others are useless for me. Basically, you can't pay or coerce me to use Excel's ribbon. Choice is good, but sadly only Excel provides this level of choice.

          Re data, MSFT designed Windows Phone to be valuable to MSFT, not ISVs/3rd party developers. Surprise! Those ISVs and developers weren't as stupid as MSFT hoped, so they didn't jump at the opportunity to enrich MSFT.

          The real question is most definitely NOT what MSFT shoulda, woulda, coulda done. The past is the past, and in the present and at least near term future MSFT is at most a vendor of iOS and Android apps in mobile.

  16. Jackwagon

    If failing in the mobile market really is Microsoft's biggest mistake, they're still doing pretty well otherwise. If anything, maybe it's for the best that they didn't become the company, or else they almost certainly would have been broken up.


    As it is, their market cap is somewhere in low earth orbit, and their cloud puts them in a bunch of other companies' back offices. Between that and Office, I'd say they don't have to worry about much of anything for the foreseeable future.

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