Why can't Microsoft or Google just build a really really really great phone? Software isn't enough.

Windows Phone 7 or WinPho7 (sounds like a tech noodle restaurant) launched today. A definite step up from Windows Mobile but still not enough to make people jump from Android or iPhone. Microsoft is definitely looking for the portion of the population that hasn't made the move to a smartphone yet but unfortunately for them, so is Google and Apple.

What gives me pause about this phone is not the interface. I haven't played with one yet but it looks intuitive and has some innovative features. My issue is the hardware which interestingly enough comes from the same manufacturers of Android phones. Samsung, LG, HTC, etc. just don't make amazing phones. They all make good phones but nothing earth shattering which is what it'll take to overtake the likes of Apple. Every Android phone I've held feels cheap, big, clunky, etc. It'll probably be the same with the new WinPho7 models. The bad part is that because the operating systems need to support multiple models, there will be compromises made to the least common denominator. A recipe for making a mediocre product.

Microsoft and Google have more than enough resources to throw at great industrial design. If this is truly a key market for them then they need to develop their own phone. The money is not in software alone. Google gives away the operating system and makes money on app sales and ads. Microsoft will most likely charge a nominal licensing fee for a WinPho7 license. Apple makes nearly 60% in gross margins on the iPhone because of hardware and software. That's about $300+ per iPhone but it's not all about the money - it's about building a phone that will blow away the competition.

Palm Pre - Pretty cool, but so what?

CrunchGear has a demo video from CES of the Palm Pre. Overall, I think it looks pretty cool. Definitely a huge step up from where the PalmOS was before, but I can't help but feel like it's a very "Me, too" product. The Card View method of viewing applications is nice and there are some pretty nice innovations on the Contacts side of things. If you don't currently own a touch screen smart phone, I think the Pre is a very viable alternative to the iPhone, Blackberry Storm, or anything from HTC.
 
Rumor has it that they are going to price the phone at $399 SUBSIDIZED, which would put it at the high end of touch screen smart phones. A quote from Palm CEO Ed Colligan, as reported by Peter Kafka, when asked if Palm considered pricing the Pre at $200 or below to compete with the iPhone was "Why would we do that when we have a significantly better product?" Well Ed, you don't really have a significantly better product. You can make the argument that the Pre is as good, at best slightly better than the iPhone (though I wouldn't). In other words, I wouldn't switch to the Pre from my 1st generation iPhone because there's nothing that much better in the Pre. And let's not forget that anything that can be claimed to be better on the Pre can easily be copied in future iPhone software updates.

As someone who has had a litany of smart phones, it took a significant feature or service improvement from one device to another for me to make the switch. I started with the original Sidekick, moved to a color Sidekick (for the color, of course), then to a T-Mobile MDA (Edge performance increase plus more flexibility in adding apps on Windows Mobile), and finally to an iPhone (my first video iPod plus all the amazing UI features). I even bypassed an upgrade to the 3G iPhone because faster data speed wasn't enough for me to pay extra for essentially the same UI. Suffice it to say, simply being a little bit better (if at all) is not enough for someone to want to pay $100-$200 more for a Pre than a 3G iPhone.