LG has announced it will run Android in more than half of its smartphones in 2010. It is a significant change from the company's current strategy. In 2009, only one LG smartphone ran Android and the rest were running Windows Mobile. It is a big hit for Microsoft as other companies such as Motorola, Samsung and HTC move away from Windows Mobile as well.
About a year ago Balmer dismissed , Google as a player on the mobile market. And in 2007 he dismissed iPhone as a threat to Windows Mobile. Now MS obviously is losing its once-dominating market position and doing it very quickly. Both iPhone and Android will likely dominate mobile markets for the next decade.
Besides the Google business model, which is definitely more appealing to the mobile service providers than Microsoft's, user satisfaction is another very important factor. Both iPhone and Android have very well designed, user-centered user interfaces.