Will Microsoft Corporation Cede This $14 Billion Market to Apple Inc. and Google Inc.?

Last April, Microsoft unveiled Windows In The Car, a conceptual infotainment platform to compete against Apple 's CarPlay and Google 's Android Auto. Like those two products, Windows In The Car mirrored a smartphone's display onto a dashboard, but it added Cortana as a co-driver.

Android Auto. Source: Google.

So, where does that leave Microsoft?

When Microsoft unveiled the concept for Windows In The Car, there were two big problems. First, it ran on MirrorLink, a standard that was losing ground to OAA and CarPlay. Second, the platform presumably ran on top of Windows Embedded, which was losing ground to QNX. Ford notably replaced Windows Embedded with QNX in its Ford and Lincoln vehicles last year in response to reports of software crashes.

Therefore, for Microsoft to make progress against Android Auto and CarPlay, it would have to launch a more universal solution compatible with QNX and OAA standards. This would make it easier for automakers to add Windows Phone compatibility as a third mirroring option.

It's about ecosystem growth

The in-car infotainment market could grow at a CAGR of 12.1% to $14.4 billion between 2011 and 2016, according to research company Markets and Markets. However, most of that revenue will go to hardware and software companies like Pioneer, Alpine, Intel , and Nuance Communications .

For Microsoft, Google, and Apple, expanding into the connected car market is all about ecosystem growth. All three companies intend to tether their mobile devices to the larger Internet of Things (IoT) market, which consists of connected cars, smart homes, and wearable devices. For example, data gathered from a user's travel habits could prove useful for crafting targeted ads.

In my opinion, Microsoft put Windows In The Car on the back burner because of the upcoming launch of Windows 10. Since Windows 10 can be scaled up and down across phones, tablets, and PCs, it might be more effectively mirrored to a dashboard than the conceptual version.

The connected road ahead

As CarPlay and Android Auto reach more cars later this year, Windows Phone users could be left out in the cold. That would just be another reason -- in addition to a lack of NFC mobile payment solutions and compatible smartwatches -- to avoid Windows Phones altogether.

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Leo Sun owns shares of Apple. The Motley Fool recommends Apple, Ford, Google (A shares), Google (C shares), Intel, and Nuance Communications. The Motley Fool owns shares of Apple, Ford, Google (A shares), Google (C shares), and Nuance Communications. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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