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September 18, 2008 3:37 PM

Ballmer fired up at company meeting, tells employees why Microsoft wouldn't build an iPhone

Posted by Benjamin J. Romano

KEN LAMBERT / THE SEATTLE TIMES

Employees arrive at Microsoft's annual company meeting.

At Microsoft's company meeting today, CEO Steve Ballmer was in full cheerleader mode, running around the stage, high-fiving Microsoft employees at Safeco Field, breathing hard and yelling into the microphone, said one observer, who asked to remain anonymous while describing an event that was closed to the public.

Ballmer sought to put employees' concerns to rest, particularly around competitors Google and Apple, our tipster said.

In particular, Ballmer said he is often asked why Microsoft doesn't do its own iPhone.

Speculation that it would do something like an iPhone (either bringing music features to Windows mobile, or building a ZunePhone) was fueled by Microsoft's acquisition of phone-software maker Danger and the formation of a premium mobile experiences team at Microsoft led by Roz Ho, who was previously in charge of the company's Mac business unit.

According to our tipster, Ballmer explained to the assembled Microsoft crowd today that one phone is never going to have more than 25 percent of the market because different people want different things out of their devices. Ballmer said that if you build the phone operating system -- as Microsoft does with Windows Mobile -- there's a much larger potential market to capture because the software can run on a wide variety of devices.

Windows Mobile was on 12 percent of the smartphones sold in the second quarter, trailing Symbian (57.1 percent) and Research in Motion (17.4 percent), according to Gartner. Apple's Mac OS X, a version of which powers the iPhone, had 2.8 percent.

Do you think Microsoft should build an iPhone competitor?

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