Microsoft Expects Windows Phone-Powered Smartphones to Cost $100 - $150

From X-bit Labs: Microsoft Corp. believes that thanks to affordability of components going forward, the price of all electronic devices in general and smartphones running Windows Phone operating system in particular will get dramatically lower. In particular, Microsoft believes that eventually companies like Nokia will be able to address mainstream market of handsets with WP-powered smartphones.

"If you look even at the price of smartphones, a year ago all smartphones cost over $400 when they left their hardware manufacturer. Today, they're down to about $200, and next year, a smartphone that can run something like Windows Phone 7 will actually be down to $100 to $150," said Andrew Lees, the president of Windows Phone division at Microsoft, during the worldwide partner conference.

Microsoft recently admitted that its smartphone market share did not increase with the launch of Windows Phone 7 operating system late last year and even declined to comment how many WP7-powered devices had been sold. Independent analysts believe that the Windows Phone platform commands from 2% to 3.8% of the smarphone market at present. Therefore, it is not a surprise that Microsoft needs to work hard not only on improving the Windows Phone itself, but to a lot more to attract customers and partners among operators and hardware makers.

"What we want to do [with operators] is provide the largest geo-footprint that we can. We are going to more than double the size of the market that we have in Windows Phone "Mango". We significantly increased the number of countries, and we will lower the price of the phones by half, increasing the total addressable market very, very dramatically," added Mr. Lees.

Last year the software giant imposed strict guidelines for smartphones powered by Windows Phone 7 operating systems. Manufacturers have to install certain processors, certain amount of memory and flash as well as use screens with no less than 480*800 resolution. As a result of such demands from Microsoft, there are no truly affordable Windows Phone 7-based handsets at the moment.

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