Microsoft to arm itself with Mango for smartphone wars

Windows Phone 7 (s msft) will get the long awaited update to Mango 7.5 today, in time to celebrate the one year anniversary of the platform. The software update will roll out to existing Windows Phone 7 devices starting today and should get to all handsets within a matter of weeks.

The update is packed with improvements including more intelligent live tiles, multitasking and a new web marketplace for buying apps from a computer. There’s also better app integration into Bing searches so searches will pull up relevant apps, both on the phone and available in the Windows Phone Marketplace. Also promised is better communication across multiple channels and groups for contacts. My colleague Kevin had a good, early review of the software last month.

I talked with Greg Sullivan, senior product manager of Windows Phone 7, about Mango and what it means for the platform as it heads into Year 2. He said Microsoft knew it would struggle through a slow first year with fewer devices in fewer languages on a small number of carriers. But he said with Mango’s release, Microsoft is building toward long-term success.

“We knew the most important thing was to build a phone that people loved,” Sullivan said. “We needed a progression of events that cumulatively would lead to success. We hesitate to predict the future but the things that need to happen are happening.”

Sullivan said Mango improves the user experience and the Marketplace now fields more than 30,000 apps with 90 percent of the most desired iOS (s aapl) and Android (s goog) apps now available on Windows Phone 7. The number of supported languages is up to 21 and talks with manufacturers and carriers are going well.

We recently mentioned the growth opportunities for Windows Phone 7 with 44 percent of NPD survey respondents saying they were open to buying a WP7 device. One of the challenges, NPD noted, was “app lock-in”, in which smartphone users are reluctant to switch platforms because of their investment in apps on Android or iOS. Sullivan said there’s still a lot of opportunity in reaching out to new smartphone users who haven’t invested in a lot of apps. The notion that users are completely wedded to a set of apps on one platform is overstated, he added. Also, with Windows Phone 7’s integration with apps, which are integrated into Bing search, apps are more valuable on WP7, Sullivan said.

Though Android still outsells Windows Phone 7 by a wide margin, Sullivan said Google’s operating system is increasingly challenged by battery concerns, malware and fragmentation while WP7 looks better each day. The relatively quick planned roll out of Mango across all devices, compared to the often slow and incomplete update process on Android, also shows that Microsoft is working hard to ensure a consistent experience across devices, Sullivan said. He said Windows Phone 7 is now an “obvious choice” over Android, something that was harder to say before.

“Android has a set of challenges that will get worse as time goes and we have a set of advantages that get more obvious,” Sullivan.

It’s hard to say that Android will immediately suffer in the face of a new Windows Phone 7 update considering it’s been on fire this past summer,¬†accounting for 56 percent of recent smartphone sales in the U.S.¬†But WP7 now feels more polished, speedy and robust with many gaps filled. It will take time and a lot of work for Microsoft to inject itself into the competition between the iPhone and Android. But the time is now for Microsoft to move.

It wasn’t until Year 2 that Android started taking off. And while Google’s platform is a world beater and stands in the way of WP7 success, it’s a hopeful sign for Microsoft that with hard work in the first year, good things can come. Microsoft has to execute almost perfectly across the board but if it does, some of the bravado and tough talk might actually prove true.