Vertical Integration Wins for Devices, Gives Microsoft Troubles

Vertically integrated software/hardware companies have a powerful advantage in the mobile device market over software-only vendors. The iPod and the Blackberry are examples of the decisive role form-factor and hardware usability play in mobile success. Without hands-on hardware design control, Microsoft can deliver the most robust Windows Media Player software or Pocket PC operating system, but will be hard-pressed to match the success of a device where the software and hardware were designed in concert. In the world of portable computing, the smaller a device the more critical the tactile human interface is to its popular acceptance.