In an effort to compete against Apple and Google in the mobile app market, Microsoft is paying developers to build mobile apps for Windows Phone 7, according to Businessweek. "The company [Microsoft] is providing financial incentives ranging from free tools and test handsets to funds for software development and marketing," said Todd Brix, a senior director at Microsoft who works with app developers. In some cases, Microsoft is providing revenue guarantees, and will make up the difference if apps don’t sell as well as expected, he said."
Microsoft says that to win customers over they need to have a large number of apps when the Windows Phone 7 handsets are released later this year. Kevin Burden, an analyst at ABI Research, thinks most developers are reluctant to spend the time building apps for Windows Phone 7 because they are not sure it will lure in enough customers to recoup their development costs.
Though Brix declined to comment on the amount of money Microsoft is spending on the program he said, "We are investing a lot to attract developers big and small to Windows Phone 7 to let them understand what the opportunity is and provide as many resources as we can to help them be successful on our platform."
The incentive terms are confidential but according to five individuals, Microsoft approached them and offered financial incentives in exchanged for having apps ready at or near the launch of Windows Phone 7. Since Windows Phone 7 is vastly different from its previous mobile operating, systems none of the old apps will work. Currently there are only 246 apps ready for Windows Phone 7 according to ABI Research compared to Apple"s 225,000 and Google"s 65,000 available apps.
At Microsoft"s WPC Steve Ballmer said, "On the phone side we missed a generation with Windows Mobile. We really did miss almost a release cycle, but Windows Phone 7 which we had a chance to debut at the Mobile World Congress earlier this year has received really quite remarkable reviews." Microsoft needs Windows Phone 7 to be a success to remain competitive in the mobile market especially after the failure of the Kin.