This all sounds like "Nyah nyah, we still think we're better than you..." to me. Unfortunately, for them, they're not.
Personally its all well and good, but until they put a proper, non-desktop UI on their devices, and make it compatible with the other platforms out there (i.e. OSX, Linux, using standards), then it will die on the vine like other niche technologies.
No phone, smartphone or otherwise, should depend on the operating system running on a desktop to function at full capacity. My Nokia and Motorola phones certainly do not, and their OS is far superior in usability to this Microsoft "Play-Doh".
Edit: After fetching the video, it becomes even more clear that Windows Mobile is heading the wrong direction.
- DirectX and real-time networked games... on a phone?
- Using an onboard GPS to "track assets"? (i.e. figure out where all of your employees are at any one time, using Microsoft Location Server to zoom in and plot it by address, business and location)?
- Always-on, downloading-in-the-background, capabilities? Not unless I can disable it, and select when and where and what times these bits of data are downloaded
- Remotely disable/wipe the phone? (only available when using Exchange 5 with SP2 of course).
- RSS feeds? Come on, we've had that on PDAs for 2+ years now already. (And he specifically mentioned this capability in IE7, as if it wasn't already a feature in Firefox/Mozilla/Safari that they simply ripped off and rebranded as "News Caching").
They're playing catch-up, and they know it.
For the privacy advocate, Windows Mobile 5.0 screams
RUN!
I heard nothing at all about the quality of the phones themselves. I don't care about having a 1gb SD card or a 3gb microdrive in my phone.
- How well does it work as a phone?
- What about the PIM capabilities? Can I beam a contact to my Palm, transparently?
- Does it work with anything but Microsoft products? (hint: No.)
- What about battery life? They danced right around that question when asked and jumped right back to the "Ooo, but look at the shiny things!" OCD.
Instead of broadening their market, they're collapsing it by making the devices depend on very specific versions of very specific software packages.
Dead end. Yes, I'm being pessimistic, but not everyone wants a "desktop" in a phone, and certainly not one that loses 80% of its capabilities if you don't run the complementary Microsoft Windows desktop operating system.
Show me that it works as a phone, connects and communicates with my existing devices using standards-compliant protocols, in a way that doesn't enforce a specific version of a specific application running on a specific desktop operating system, and I'll consider it.