By Silicon el 24-Jun-2008 |
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Why is Nokia (NOK) spending $410 million to buy the rest of Symbian, the smartphone operating system it co-owned with Sony Ericsson and others? Because its continued dominance of the smartphone market -- 60% of the install base, according to its press release -- is anything but guaranteed.
Buying Symbian won't help Nokia build sexier-looking, high-end gadgets. But in theory, Nokia's ownership will speed up Symbian's platform development and could allow Nokia -- its biggest customer -- to come out with more phones, faster.
That's important as new competitors enter the market with sexier, more exciting products, like Apple's (AAPL) iPhone, which is just opening up to outside developers. So far, Apple's success has mostly been in the U.S. But this year, it will start selling its iPhone in more than 70 countries, at a lower, subsidized price.
Add new BlackBerry gadgets from Research In Motion (RIMM), Microsoft's (MSFT) continued success with Windows Mobile, and potentially exciting Linux-based platforms from Google (GOOG) and the LiMo foundation, and Nokia could have a lot to lose: Smartphones over $300 accounted for just 7% of the phones Nokia sold last year -- but they represented about 15-20% of its cellphone revenue and 20-25% of its gross profit, according to AmTech analyst Mark McKechnie.
One key move: Nokia will create a master platform by combining different flavors of Symbian's software, including Symbian OS and its S60 software, plus UIQ software from Sony Ericsson and Motorola (MOT), and MOAP from DoCoMo. This means that developers can write one app for all of them, instead of different editions for each -- a problem that frustrated coders.
Also important: Symbian will now be free, which gives carriers and device makers one more reason to choose it over Windows Mobile, Android, LiMo, or a different smartphone OS.
See Also: Nokia Blindsided By iPhone, BlackBerry -- No 'Credible' Answer Where Nokia Could Fail: Competing With Apple And RIM Nokia Picks Up Social Networking Service Plazes

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