The Nokia 900 Lumia was Microsoft’s latest best chance at turning the smartphone battle into a three way race.

Unfortunately for Microsoft, the first reviews are out, and they’re not great.

They’re not awful, but they’re not great. And any Windows Phone has to be great to have a chance against Apple’s iPhone, which sold 37 million units just last quarter, and phones running Google’s Android platform, which are selling around 850,000 per day (based on Google’s activation numbers).

Meanwhile, Microsoft has been at this game for way too long, with way too many do-overs and false starts.

The iPhone was announced in January 2007. At that time, Microsoft’s Windows Mobile platform had 14% market share, according to research firm Canalys.

The iPhone made Windows Mobile look totally irrelevant, and it quickly started losing market share.

It took Microsoft more than three years to come up with its answer: Windows Phone Series 7. It was announced in February 2010. (Microsoft later dropped the “Series” from the name. It ought to drop the “Windows” too, but that’s another story.)

The first phones shipped that fall. The software looked fresh and new — at least it wasn’t a blatant ripoff of the iPhone like Android. But it also wasn’t good enough. No multitasking, no copy and paste, no apps.

By then, Microsoft’s global smartphone market share had dropped to 3%.

In February 2011, Microsoft signed its big deal with Nokia, committing more than $1 billion up front to joint marketing and other incentives. The first Nokia Windows Phone, the Lumia 800, shipped in England in October 2011.

By the end of 2011, Microsoft’s global market share had dropped to 1.4%.

Now it looks like the Lumia 900 won’t be the savior either.

To recap: Microsoft has had FIVE FULL YEARS to come up with an answer to the iPhone. It still isn’t there.

So how long until we can declare Microsoft’s smartphone ambitions dead once and for all?

Another year? Two? Five?

The trouble is, this isn’t some hobby project like the Zune where Microsoft can quietly withdraw and pretend the whole thing never happened. Losing in mobile could eventually bring the entire company down.

Smartphones are already outselling PCs. That has huge implications for Windows ($20 billion a year in sales), Microsoft’s business apps like Office and Exchange email (another $20 billion a year), and just about everything else the company does.

Microsoft knows this.

From everything we hear from sources close to and within the company, mobile is the new Bing. Microsoft will keep at this market for as long as it takes, and spend as much as it possibly can get away with, to become number three. The next step, from what we hear, is to make Windows Phone more like Windows, which will help developers build for PCs, tablets, and phones all at once.

What if that fails? Then what? Buy what’s left of RIM? Buy Nokia?

Maybe. Whatever it takes.

Remember: Microsoft dropped more than $10 billion on the Xbox before it ever turned a dime in profit (that’s operating loss — not including acquisitions. It’s still about $4 billion in the hole, lifetime.) Microsoft has also lost $10 billion (operating loss) on Bing and other consumer online services just since 2007.

This is way more important. Expect the commitment to go even deeper, and to drag on even longer if necessary.

Which means this zombie is going to keep walking for a long, long time.

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Microsoft Office On The iPad Is Killing Windows
Windows is dead. Microsoft Office killed it. Or it will, once Microsoft ports Office to the iPad. For just as porting Office to Mac OS X back in 2001 sowed the seeds of Apple’s relevance as a credible desktop alternative to Windows, so too will Microsoft’s capitulation to the iPad ensure that Windows will die even as Office takes on a new, multi-billion dollar relevance. Right now, Microsoft’s only real money in mobile comes from Android licensees. So Microsoft needs a winner in mobile, and Windows isn’t it. At least, not anytime soon. All said and done, Windows is still the number one operating system. But rivals are changing that, and quickly. In a recent survey, 68% believe iOS and Android will take over desktops as well.

Source: The Register

Apple is firing on all cylinders. Today, its stock hit a high of 496.75 just shy of $500. At that share price, Apple is bigger than both Microsoft and Google combined. Here is some excellent analysis from AppleInsider:

Apple’s stock soared to new heights on Thursday, pushing the company’s market capitalization to $456 billion, a number that is greater than the values of rivals Google and Microsoft combined.

As of Thursday morning, Microsoft’s market cap was around $256.7 billion, while Google was valued at around $198.9 billion. With Apple’s stock up more than 3 percent in morning trading, the company surpassed the combined totals of both Google and Microsoft.

The milestone comes soon after Apple reported its best quarter ever, earning $13.06 billion on sales of 37 million iPhones, 15 million iPads and 5.2 million Macs. Total revenue for Apple’s holiday quarter was $46.33 billion.

But Google’s shares fell more than 9 percent last month after the company missed expectations on Wall Street for both earnings and revenue. And while Microsoft met Wall Street expectations, revenue from its Windows operating system fell 6 percent to $4.74 billion.

Apple’s market capitalization passed Microsoft alone in May of 2010 when the iPhone maker’s value hit around $222 billion. And last August was the first time that Apple passed Exxon to become the world’s largest company by market cap, then with a value of $346.74 billion.

As of Thursday morning, Apple was well ahead of Exxon Mobil, which had a market cap of around $402 billion. That put Apple at a value of more than $50 billion more than the oil giant.

With AAPL stock north of $490, some Wall Street analysts on Thursday began increasing their price targets for the iPhone maker. Charlie Wolf with Needham & Company upped his estimate from $540 to $620, while David Evanson with Canaccord Genuity raised his target on AAPL shares even higher, to $655.

Apple’s earnings were so huge here is a little perspective on how big it was.

Who would have thought 10 years ago that Apple would make more money than Microsoft. This quarter Apple’s revenues came in at $46.33 billion, more than Microsoft’s $20.9 billion. Apple also earned a profit of $13.06, again, more that double Microsoft’s $6.62 billion.

Apple’s profits for the last quarter exceed Google’s entire revenue for the last quarter. Apple’s profit for the entire year now beats Google’s revenue for the entire year.

The Apple iTunes Store alone generated 50 percent more revenue than all of Yahoo did last quarter. The amount Apple paid to third-party developers via the App Store last quarter ($700 million) is more than double Yahoo’s overall profits.

Apple’s profit last quarter was $3 billion more than all of Hollywood’s gross box office receipts for all of last year.

Apple’s stock popped nearly 10 percent from where it closed to $460 a share, after hours. That pushes Apple well beyond the $400 billion market cap — and once again past Exxon as the most valuable public company in the world.

Microsoft (MSFT) is expected to layoff hundreds of people as part of a company wide restructuring of its marketing operations reports Bloomberg.

It not known exactly how many people will be let go but the cuts will start within the next 30 days according to Bloomberg’s sources. Microsoft Chief Executive Officer Steve Ballmer doesn’t think the company is getting enough return on the billions it spends annually on marketing, the sources said.

The cuts would eliminate overlap in job responsibilities and are designed to help the company better respond to threats from Apple (AAPL), Google (GOOG) and Amazon.com (AMZN), which are increasingly targeting Microsoft’s corporate-computing customers.

“The changes may include shifting some of the more technical marketing workers to engineering groups, cutting employees who don’t have needed skills or whose work is duplicated by other workers, and revamping how marketing groups are organized and where they fit into the rest of the company”, the sources told Bloomberg.

Microsoft spent $13.9 billion on sales and marketing in fiscal 2011, up 5.5 percent from the previous year. Microsoft said then that it had 25,000 workers devoted to those tasks, without breaking out how many are focused on marketing. The company had about 90,000 full-time employees in total.

Consumer-focused technology companies like Apple are making inroads in the business world, forcing the information- technology industry to regroup. Apple will sell $10 billion worth of iPads and $9 billion of Mac computers to corporate customers this year, a 58 percent jump, according to Forrester Research.

Microsoft also is facing rising costs because of a shift to cloud software, which is stored in the company’s data centers and delivered over the Internet. Its $8.5 billion purchase of Skype Technologies SA and Xbox gaming products are increasing expenses as well.

The WSJ reports 8 of 10 most read business stories in 2011 were Apple related. Apple dominated news media making headlines with product launches that stoked frenzy to the somber news of Steve Jobs’s death.

1. Death of the Steve Jobs
Steven P. Jobs, the Apple Inc. chairman and co-founder who pioneered the personal-computer industry and changed the way people think about technology, died in October at the age of 56.
(Oct. 5, 2011)

2. Verizon Finally Lands the iPhone
The move for the first time let U.S. consumers choose the network that carries their iPhone.
(Jan. 7, 2011)

3. Jobs Quits as Apple CEO
Steve Jobs, the ailing tech visionary who co-founded Apple Inc., said in August that he was unable to continue as chief executive of the technology giant and handed the reins to Chief Operating Officer Tim Cook.
(Aug. 24, 2011)

4. Apple’s New iPad in Production
Apple Inc. by February had started manufacturing a new version of its iPad tablet computer with a built-in camera and faster processor.
(Feb. 8, 2011)

5. Sprint to Get iPhone
Sprint Nextel Corp. would begin selling the new version of the Apple iPhone in mid-October, filling a huge hole in the No. 3 U.S. carrier’s lineup and giving Apple Inc. another sales channel for its popular gadget.
(Aug. 23, 2011)

6. New iPhone Bows but Fails to Wow
Despite upgrades to its internal components and some new software capabilities, the iPhone 4S looks like its predecessor physically and doesn’t make a big leap in its overall capabilities.
(Oct. 4, 2011)

7. Apple’s Showman Takes the Stage
Steve Jobs asserted Apple Inc.’s command over the hottest market in computing and demonstrated his flair as high-tech’s most celebrated pitchman.
(March 2, 2011)

8. Apple, Google Collect User Data
Apple Inc.’s iPhones and Google Inc.’s Android smartphones regularly transmit their locations back to Apple and Google, respectively, according to data and documents analyzed by The Wall Street Journal—intensifying concerns over privacy and the widening trade in personal data.
(April 21, 2011)

9. Borders Forced to Liquidate, Close All Stores
Borders Group Inc. said it would liquidate after the second-largest U.S. bookstore chain failed to receive any offers to save it.
(July 18, 2011)

10. Microsoft Co-Founder Hits Out at Gates
Bill Gates schemed to take shares in Microsoft Corp. from his co-founder during the early days of the software company following his partner’s treatment for cancer, according to a memoir by the billionaire co-founder, Paul Allen.
(March 30, 2011)

The International Trade Commission sided with Apple (AAPL) and ruled that Android handset-maker HTC was copying elements of its iPhone and that its imports of certain phones into the United States be stopped.

The decision, which is subject to a 60-day review by the Obama Administration and will likely be appealed, turns another page in a complicated legal skirmish being tracked by both retailers and analysts because of its possible impact on HTC’s Android business.

It is a closely watched patent battle with potential repercussions for the smartphone industry, in particular smartphone makers who use Google’s (GOOG) Android operating system. Apple, claimed that Taiwan-based HTC, one of the fastest growing players in the mobile-phone industry and the No. 3 smartphone provider in the United States, infringed on two of the patents governing the technology behind its phones. The ITC found that only one of the patents — which allows users to tap on a phone number in an e-mail and immediately be connected — had been infringed by HTC.

The San Jose Mercury reports that by issuing a “limited exclusion order” prohibiting HTC from importing devices that run the software in question, the commission is essentially telling HTC it must figure out a way around the disputed patent or else stop bringing its phones into the United States. The court gave HTC until next April to comply, or else come up with a “workaround” that would resolve the issue.

HTC downplayed the significance of the ruling saying that the disputed feature will be completely removed from all its phones.

“This it just one more step in a long process,” said Bijal V. Vakil, a partner in White & Case’s Intellectual Property Practice and executive partner of its Silicon Valley office who was not involved in the case. “HTC will likely appeal the ruling to the United States Court of Appeals for the Federal Circuit. HTC may also file a request for a stay on the order, which often happens. This not a disastrous ruling at all for HTC.”

According to the Mercury, with Google’s Android system now the most widely used software on smartphones, an order barring or cutting back on the number of HTC phones entering the country would have severe repercussions at the retail level.

In addition to Apple, Oracle (ORCL) has sued Google, claiming Android violates its patents and copyrights. And Microsoft is suing Motorola Mobility over Android.

Today, was a first of many victories to come for Apple. Apple co-founder the Great Steve Jobs’ “vow to kill Android”. That’s materializing.

The International Trade Commission sided with Apple (AAPL) and ruled that Android handset-maker HTC was copying elements of its iPhone and that its imports of certain phones into the United States be stopped.

The decision, which is subject to a 60-day review by the Obama Administration and will likely be appealed, turns another page in a complicated legal skirmish being tracked by both retailers and analysts because of its possible impact on HTC’s Android business.

It is a closely watched patent battle with potential repercussions for the smartphone industry, in particular smartphone makers who use Google’s (GOOG) Android operating system. Apple, claimed that Taiwan-based HTC, one of the fastest growing players in the mobile-phone industry and the No. 3 smartphone provider in the United States, infringed on two of the patents governing the technology behind its phones. The ITC found that only one of the patents (patent 5,946,647), which allows users to tap on a phone number in an e-mail and immediately be connected — had been infringed by HTC.

The San Jose Mercury reports that by issuing a “limited exclusion order” prohibiting HTC from importing devices that run the software in question, the commission is essentially telling HTC it must figure out a way around the disputed patent or else stop bringing its phones into the United States. The court gave HTC until next April to comply, or else come up with a “workaround” that would resolve the issue.

HTC downplayed the significance of the ruling saying that the disputed feature will be completely removed from all its phones.

“This it just one more step in a long process,” said Bijal V. Vakil, a partner in White & Case’s Intellectual Property Practice and executive partner of its Silicon Valley office who was not involved in the case. “HTC will likely appeal the ruling to the United States Court of Appeals for the Federal Circuit. HTC may also file a request for a stay on the order, which often happens. This not a disastrous ruling at all for HTC.”

According to the Mercury, with Google’s Android system now the most widely used software on smartphones, an order barring or cutting back on the number of HTC phones entering the country would have severe repercussions at the retail level.

In addition to Apple, Oracle (ORCL) has sued Google, claiming Android violates its patents and copyrights. And Microsoft is suing Motorola Mobility over Android.

Today, was a first of many victories to come for Apple. Apple co-founder the Great Steve Jobs’ “vow to kill Android”. That’s materializing.