Microsoft on Tuesday announced a set of devices designed to advance the company's vision of running its newest operating system and "universal apps" across all its devices.
The lineup also attempts to realize the strategy Microsoft laid out earlier this year, putting the focus on mobile software and the cloud.
"What matters most is the mobility of your experience, not the mobility of a single device," Microsoft CEO Satya Nadella said at an event in New York. As devices come and go, "you persist," he said, adding that no single device will be hub of activity forever. "The hub is you."
The company's new products include smartphones, a Surface Pro 4 tablet, a wearable fitness tracker, a laptop called the Surface Book and the HoloLens, a virtual/augmented reality device the company has been prototyping.
They run on Windows 10, which executives said has been installed on 110 million devices since its introduction in July. They also said the company's share of devices has grown since the debut of Windows 10, but did not elaborate.
Microsoft's new flagship phone, the Lumia 950, will have a 5.2-inch screen and will be available in November for $549, while a larger Lumia 950 XL will offer a 5.7 inch screen and retail at $649.
Although the company used the event to say its new phones help launch Windows 10 mobile, with a processor that makes them some of the most powerful Windows phones yet, the real focus is Microsoft's vision for true consumer mobility across devices. Windows 10 and Microsoft's universal apps, for example, are meant to work across all the company's products, including not just phones and tablets but PCs and the Xbox One gaming console. That pitch, including the idea that the Lumia can itself work as an actual PC when necessary, are meant to differentiate Microsoft's phones from those of Apple and Google, which both introduced new editions last month.
The Lumia can plug into a monitor and provide the user with a PC-like experience, with apps adapting to the screen, the company said. That's particularly useful in developing markets, where phones can be people's first and sometimes only computers, Mr. Nadella said.
A place in innovation
Microsoft has been chasing the smartphone business since 2010, but hasn't fully realized its potential amid intense competition from Apple and phones using Google's Android operating system. With the phones announced today, the company hopes to turn its fortunes around, or at least show what it could be capable of in the future.
"Microsoft is relevant to conversation now about how people do computing, in a way they haven't been in a long time," said J.P. Gownder, analyst at Forrester. "Before before it was 'How much are they going to lose in mobile?' But now they have a place in innovation."
Still, Microsoft's market share in the smartphone world is miniscule. In the second quarter its global share of shipments from manufacturers was 2.6%, according to IDC. Google's Android had 82.8% and Apple's iOS had 13.9%. In the second quarter, Blackberry had 0.3%, but even that company seems to have recognized defeat in the operating system game and in September announced an Android-enabled smartphone, Priv. Microsoft's results for the U.S. aren't much better, with 2.9% share in July, according to ComScore.
The company to some extent must know that it will likely never rival Apple and Google in market dominance -- at least any time soon -- and aside from universal apps, it's been working to offer its products on their platforms. Earlier this year, Samsung, the biggest Android-running phone manufacturer in the world, made Microsoft apps availble to its Galaxy S6 phone and some tablets. Companies such as Sony and LG offer something similar, sometimes with Microsoft products pre-installed on the phones.
Universal apps, meanwhile, may help Microsoft slowly grind out progress on market share. The company doesn't have as many apps because developers don't generally want to build for an audience as small as Microsoft's, according to Mr. Gownder, the Forrester analyst. But Windows 10 is a "Trojan horse," he said, because it's the same operating system for PCs, tablets and phones, meaning developers have to tweak very little for their apps to function device to device. In the long term, more developer interest could make Microsoft's app store more competitive with Apple's and Google's, in turn benefiting its device sales.
The company said developer revenue and app use has increased since the Windows 10 rollout, though it didn't offer details. Facebook will be introducing universal apps for Facebook proper, Instagram and Facebook Messenger, it added.
As it is doing with its Lumia phones, Microsoft pushed its new Surface Pro 4 tablet as a productivity machine that can replace your laptop and connect with all Windows devices. The company described it as thinner, brighter and 30% faster than its predecessor, as well as 50% faster than the MacBook Air. It starts at $899 with a release date of Oct. 26.
"This challenge of the tablet or the laptop, which do you buy? Remember that problem?" said Panos Panay, corporate VP, Microsoft. "That problem is gone."
Three years ago the company introduced the Surface Pro. Now, the hybrid laptop generates more than $3.5 billion annually in sales, the company said. This latest one comes after Google last week unveiled the Pixel C tablet and Apple last month touted the iPad Pro and Apple Pencil stylus.
The iPad Pro, however, was also positioned as an enterprise powerhouse. Apple even brought a Microsoft VP to the stage to demonstrate Office on the new iPad and show how well Office works with Apple Pencil.
Microsoft, of course, offered a tablet stylus for years while Apple refused to do the same, and on Tuesday it discussed the improvements it has made there. Its stylus now comes with a digital eraser, magnetically attaches to the side of the device and comes in five colors and different pen-tip styles. Holding the pen's eraser will prompt the Surface Pro 4 to launch Cortana, the Microsoft voice search that's connected to Bing as well as Windows 10.
The Surface Book is designed to appeal to consumers who want a bigger screen and the functionality of a full keyboard ... and may not have bought in on the "tablet" concept yet: Though it's marketed as a laptop, the Surface Book keyboard is detachable.
Execs at the event compared it to Apple's Mac Book Pro, and said it was "two times faster" than Apple's computer. It will be available Oct. 26.
Microsoft also introduced its newest wearable, the Microsoft Band 2, which offers some improvements over its previous iteration. Microsoft added a barometer to give it real-time elevation tracking, a feature yet to show up on other smartwatches. The device can also be connected to apps that will be available across all mobile operating systems, including iOS and Android.
Band 2 will be available Oct. 30 and has a price point of $249.
While wearables have yet to gain mass adoption, the market is certainly lucrative: some 111 million units are expected to ship by 2018, according to a study published by IDC.
And Microsoft presented HoloLens, its "mixed reality" device that the company said is more than virtual reality, because it uses holograms for its graphics to "bring experiences in the real world." The company didn't say when HoloLens would be available to the public, but said developers can apply for a $3,000 development kit early next year.