Ballmer: Windows Phone 7 not successful yet

IDG News Service - While Microsoft has enjoyed many successes over the past year, Windows Phone 7 hasn't been among them, admitted Microsoft CEO Steve Ballmer during the opening keynote Monday at the 2011 Microsoft Worldwide Partner Conference, being held this week in Los Angeles.

Ballmer took time to celebrate some of the successes the company has had over the past year, such as the success of Microsoft Office and Windows 7. He did display some modesty in admitting that the company did not make major in-roads with Windows Phone 7. "In a year, we've gone from very small to ... very small," he said, referring to the market share that the phone operating system has made since its introduction last year.

Last month, survey firm Nielsen estimated that Microsoft Phone 7 was in only about 1% of all the handsets now being used in the U.S.

Nonetheless, Ballmer maintained confidence that it would draw more users in the years to come. "You will see a lot of progress in the market going forward," he said.

Using the Windows operating system, Ballmer seemingly took the opportunity to bash competitor Apple with its success with the iPad, though he did not mention that company by name.

He noted that Microsoft had sold more than 350 million licenses for Windows 7, while other unnamed companies, presumably Apple, were celebrating success with only 20 million copies of their OS. "350 is a lot more than 20," he said.

Much of the opening WPC talk focused on the work that Microsoft partners have done in helping the company, most notably in the emerging field of cloud computing.

In his keynote, Jon Roskill, Microsoft's corporate vice president of the worldwide partner group, noted that Microsoft has more than 640,000 partner companies, which collectively have 15 million employees. About 95% of Microsoft revenue comes from partner-related work, he said. For every $1 Microsoft makes on its software, partners make $8.70 in additional revenue servicing and customizing these products, he said.

About 58% of partners at the conference "are working with the cloud," though in most cases the use is still exploratory, Roskill said.

Ballmer repeatedly stressed that one of Microsoft's unique advantages is that it works with both on-premise software and cloud services. He noted that technologies from competitors such as Oracle and VMware "[have] merit, but what we think what customers want to do is match between the public and private clouds," he said.

This year's WPC is pivotal for the company. Microsoft is under a lot of pressure to produce an operating system that manufacturers could use to compete with Apple's iPad.

Attendees, consisting mostly of Microsoft partner businesses, will also be eager to hear of news this week about Microsoft's Azure cloud service offering. More than 12,000 participants are attending this year's WPC.

Joab Jackson covers enterprise software and general technology breaking news for The IDG News Service. Follow Joab on Twitter at @Joab_Jackson. Joab's e-mail address is Joab_Jackson@idg.com