Fire sale on Windows Phone 7

AT&T cuts price of its WP7 phone by half -- again

AT&T this week cut the price of two Microsoft Windows Phone 7 handsets after having already cut the price in half a few months earlier, another bad sign for the beleaguered mobile OS. To be sure, discounting is par for the course in the mobile handset market and retailing in general, but it’s also a common indicator of a problem: We’ve gotta move this stuff.

AT&T Storefront
AT&T says it’s slashing the contract price for the Samsung Focus and the LG Quantum to $49.99, from $99.99 in January and $199.99 when they were introduced in November 2010. T-Mobile, meanwhile, is selling ts HTC D7 for $99.99. Also, Sprint began selling its first WP7 device, the HTC Arrive, March 20 at $199.99, which I reviewed. And the HTC Trophy is due out from Verizon soon, price unknown, but my guess it would be $199.99 for starters.

To be sure, discounting is done all the time and to be fair to Microsoft, AT&T also announced price cuts on a Samsung phone running Google Android and two RIM BlackBerry models. But the thing is Apple doesn’t usually have to do discounts, except when it’s replacing the iPhone 3GS with the iPhone 4, for example. But AT&T, for instance, doesn’t have anything with WP7 coming in behind the Samsung Focus or LG Quantum to make those the discontinued devices, although it is teasing the HTC D7S as “coming soon” -- no price or release date yet -- still, that’s just one model and as I’ve noted before, Android seems to be busy with more handset introductions than others to keep its buzz going.

AT&T’s spokesman in San Francisco, John Britton, declined to discuss it’s pricing strategy given that it’s “very competitive and very proprietary.” But the numbers speak for themselves that Microsoft is still trying to gain traction for WP7 in a market where Android and Apple have the momentum.

Microsoft has reason to hope for traction in the wake of Nokia’s decision to adopt WP7 as the OS on its next generation of smartphones and should find encouragement from an IDC forecast released Tuesday that says Microsoft is on track to surpass iPhone and BlackBerry, growing to almost a 21 percent share of the global smartphone market by 2015 with an impressive compound annual growth rate of 67 percent. IDC’s predictions are based on Microsoft and Nokia being able to convert massive numbers of low-end Nokia wireless phone users to WP7 devices, which is questionable if WP7 also tries to compete at the high end smartphone market.

Ballmer and company better hope those IDC predictions come true and that they don’t do anything to screw it up.

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Copyright © 2011 IDG Communications, Inc.

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