Microsoft has recently done some reshuffling of key executive posts, which includes its Windows Phone 7 chief. In assigning Andy Lees a new non-executive "contributor" role working directly under the CEO, is Microsoft on its way to merging its desktop and mobile operating systems?

Microsoft CEO Steve Ballmer has recently reshuffled some key positions in its top management, and there are questions on how this will impact business moving forward. Andy Lees, who has headed development of the company's mobile platform as president of the Windows Phone Division will leave his post and will be working directly with Ballmer in an undisclosed project.

I have asked Andy Lees to move to a new role working for me on a time-critical opportunity focused on driving maximum impact in 2012 with Windows Phone and Windows 8. We have tremendous potential with Windows Phone and Windows 8, and this move sets us up to really deliver against that potential.

The CEO's announcement is quite cryptic, although it suggests that the company might be working on combining the Windows 8 and Windows Phone code base, such that there will be a unified operating system that will run on both desktop computers and mobile devices like smartphones and tablets.

One OS to Rule Them All ...

In fact, there is precedence in converting a desktop operating system for use on mobile devices. When Apple first built the iPhone, Steve Jobs' developers stripped down Mac OS X to its most basic components and incorporated a touch-friendly user interface meant for small screens. As such, iOS shares the same Unix-like Darwin underpinnings of OS X without the bulk.

In launching its upcoming Windows 8 operating system the same way, Microsoft will, in effect, fit its desktop operating system into a phone, but this will result in advantages relating to application development. Also, a common user experience and platform will encourage users to adopt Microsoft's smartphone and tablet platform more easily. Microsoft is already making a big move toward adopting its Metro user experience in applications meant for Windows 8. Metro, which initially launched with Windows Phone 7, features a touch-friendly tile-based interface that can work well in both big- and small-screen scenarios.

Or Is it a Sign of Surrender?

However, the recent restructuring at Microsoft may not necessarily be a good thing for Andy Lees. The executive essentially loses his "president" title, and will be moving to an independent contributor role. There are speculations that he is being quietly being sent to the sidelines due to the failure of Windows Phone 7 to gain any traction in the market. The mobile platform has reportedly lost market share amid the meteoric rise in popularity of Google's Android and Apple's iPhone. WP7's user base has declined from 2.7% in 2010 to 1.5% in Q3 2011.

Microsoft is heavily banking on the recent launch of Nokia's WP7-powered Lumia 800 and Lumia 710 smartphones, which will help determine whether their smartphone platform will be viable in the long term. Whether it's a smart move to merge its desktop and mobile operating systems, the market will determine by next year. Windows 8 is set to launch by mid-2012, and Gartner says "a true turnaround won't take place until the second half of 2012," noting how a big marketing push by both Microsoft and Nokia this Q4 2011 might affect the Windows Phone platform's popularity among smartphone consumers.