This was not the announcement that Todd Brix had hoped for.

Motorola, he was told, will release 20 to 30 phones running Google’s Android OS in the next 12 months. The company was rejecting Microsoft and choosing the Google operating system as the primary platform for its mid-tier to high-end phones.

Effectively, as the San Francisco Chronicle reported, although there may still be a Windows Mobile phone somewhere in the mix, Motorola is betting the company on Android.

For Google, the news is a major boost. And it comes primarily at Microsoft’s expense.

To make matters worse, Motorola hopes to encourage software developers to participate in its new App Accelerator Program and make use of its MOTODEV Studio for Android.

As Senior Director for Mobile Platform Services Product Management at Microsoft, Todd Brix needs those developers. His responsibility is to ensure that when the Windows Marketplace for Mobile application store eventually opens for business towards the end of the year, anybody with a WinMo phone will be able to download the apps they desire.

In a blog posting Brix wrote: “Our strategy for all of this is pretty straightforward; we want to create a global marketplace for Windows Phones where developers and users meet to sell and buy high quality and high value applications that make work easier and life more fulfilling.”

To succeed, Brix first has to persuade developers to write those high quality and high value applications.

The question is: why should they bother?

In response Microsoft proposes to promote the Race to Market Challenge, a contest that will end with four winning developers being given four touchscreen Microsoft Surface tables.

By comparison, Google's first Android Developer Challenge offered 10 teams the opportunity to each win a $275,000 prize, a further 10 teams a $100,000 cheque, and each of the top 50 finalists $25,000 as incentives to program the 'best' of the first-ever Android applications.

Of course, should the Race to Market Challenge fail to provide sufficient stimulation, Brix could quote new market projections from Juniper Research, showing that the number of mobile application downloads will approach almost 20 billion per annum by 2014.

With the 1.5 billion apps downloaded from the iPhone App Store in the 12 months since it first opened estimated to have generated sales worth around $0.5 billion, there is no doubting the market’s potential.

So it is perhaps not surprising that everybody from Nokia to LG have already decided to jump on the App Store bandwagon. 

Similarly, venture capitalists want their share. Kleiner Perkins Caufield & Byers operates a $100 million iFund for developers of iPhone applications. JLA Ventures runs a $150 million BlackBerry Partners Fund for BlackBerry developers.

“We are,” as Brix has already admitted, “late to market.”

However Brix estimates the software customer base for Windows mobile phone applications to be around 30 million people. So developers might be seduced by the potential of a market that size.

By comparison Apple can now boast now more than 40 million iPhone and iPod Touch users, with 5.2 million iPhones having been sold in the second quarter of this year alone.

Consequently Brix could argue that if Apple customers can download 1.5 billion apps in a year, on a pro rata basis the Windows Marketplace for Mobile application store has potential for 1.1 billion.

Unfortunately that makes no allowance for any differences or limitations imposed by either operating system. Nor does it factor in what owners of WinMo 6.0 and 6.1 OS handsets will do when the time comes to upgrade.

Because the problem that many users will face, even if they do wish to remain loyal to Microsoft, and that must be questionable, is deciding what phone to buy.

Given the critical mauling that Toshiba have received for choosing Windows Mobile for the TG01, the enthusiasm that has greeted HTC’s choice of Android for the Hero and Nokia’s continuing commitment to Symbian, their options were already likely to shrink.

Now, with Motorola deciding to commit to Android, the future for Windows Mobile looks even bleaker.

The threat Google poses to Microsoft has been previously discussed elsewhere on this blog.

Put simply, to remain a player in the mobile market Microsoft must ensure that first WinMo 6.5 and subsequently WinMo 7.0 are considerable improvements on their predecessors.

But that alone will not suffice. Because, by itself, even a good OS is no longer enough. Soon, without apps, no platform will be able to compete.

Brix, too, has to succeed.

Microsoft are caught in a downward spiral. Their uncompetitive OS is being installed on fewer handsets, making that platform less attractive to developers, in turn making it less attractive to users. As a result it becomes even less attractive to manufacturers, reducing the number of available handsets still further, further discouraging developers, so forcing users to look elsewhere for alternatives.

To break this spiral Brix has to get developers on board. And giving away four touchscreen Microsoft Surface tables is not the answer.

Instead he and Microsoft have little choice but to throw money at the problem. Their only option is to bribe the most innovative developers to develop for Windows Mobile in preference to any other platform.

In 1995, in The Road Ahead, Bill Gates wrote: “Success is a lousy teacher. It seduces smart people into thinking they can't lose.”

Yet a few years later, in 2001 in a speech he gave at the Computer History Museum, he was quoted as saying: “Microsoft has had clear competitors in the past. It’s a good thing we have museums to document that.”

With those words the ancient Greeks would have thought him guilty of hubris, the excessive pride or arrogance that precedes disaster.

Perhaps the directors of Microsoft should instead remember what their founder first said. And quickly start writing those cheques.