Microsoft CEO Steve Ballmer told analysts in New York that the Apple's iPhone is no match for Windows Mobile.
"The real market momentum with operators and the real market momentum with device manufacturers seems to primarily be with Windows Mobile and Android," Ballmer told analyst during a midyear update in New York.
While he acknowledged that the iPhone had "consumer market mojo," he suggested that it did not have the same market potential as the mobile platforms controlled by Microsoft and Google.
Ballmer has a history of iPhone putdowns. Judging by his latest appraisal of the smartphone market, he still has trouble accepting the success of Apple's phone.
But data from a Gartner report from the third quarter of 2008 showed RIM's BlackBerry models and Apple's iPhones in a distant second and third behind Nokia, whose 42 percent market share of phones largely run the Symbian OS.
Gartner's data indicated that Windows Mobile shipped four million units in the quarter, compared to 4.7 million iPhones.
Microsoft has announced plans to open Microsoft stores to counter Apple's retail success, and is also designing a new UI for Windows Mobile 6.5.
However, momentum will be slowed by the fact that the retail stores and new mobile OS are still being developed - Windows Mobile 6.5 won't be available until the second half of the year, and it's not certain when the first Microsoft stores will open. Windows Mobile 7 won't ship until some time next year.
In the meantime, Apple will likely introduce a major revision to its iPhone OS this year, increasing the technology gap between it and Windows Mobile.