Mobile Musings, Mostly

The announcement of the purchase of the rest of Symbian by Nokia and the concurrent launch of the Symbian Foundation attracted a lot of (web) ink in its immediate aftermath, including from yours truly.

Observers have commented on the implications of this announcement, but I would recommend a recent one from Andreas Constantinou on the VisionMobile blog. Andreas had done a good job of taking all the other events that have transpired over the past several months including the launch of the iPhone SDK, Android, Nokia’s acquisition of Trolltech, etc. and created a framework to think of the evolving landscape.

He states that there are now seven centres of gravity in mobile..

As the dust is clearing after the storm, a new landscape is unveiling in the mobile industry; one where the balance of power is concentrating around 7 centres of gravity: Adobe, Apple, Google, LiMo, Microsoft, Nokia and Qualcomm.

By focusing on what each of these entities brings to the table from a technical and commercial standpoint, Andreas has provided some much needed perspective and a framework with which to track the evolution of the mobile space. Of the 7 players in Andreas’ list, two of them have not yet shipped a single device yet in 2008 - Google and LiMo (yes there are devices with common stack objects from LiMo that have shipped). So it will be interesting to see how the Android device launch pans out this year.

However, he has interestingly left out RIM from this list. Although a niche player in the enterprise segment, trying to expand into the consumer space, RIM has to be treated as a contender. They have a developer environment, solid install base, and decent carrier GTM relationships. How that translates into their ability to deal with the scale and resources that the others can bring to the market is open.

Some of you may have read this announcement yesterday, from Nokia to the effect that

• They have made a cash offer of approximately EUR 264 million to buy out the remaining 52% ownership of Symbian Ltd. they did not already own.

• This would be the first step in the creation of the Symbian Foundation to “provide royalty-free open platform and accelerate innovation“.

Parsing through the press releases, we learn that

1. The cash offer has been OK’ed by shareholders (Sony Ericsson, Ericsson, Panasonic, Siemens) who own close to 91% of Symbian Ltd.
2. Symbian Ltd. will be acquired by Nokia; the transaction is expected to close by Q408
3. The Symbian Foundation will unite the Symbian OS, and the various UIs that have sprung up, specifically - S60, UIQ, and MOAP(S). The Foundation will combine all these parts to create a new OS and UI.
4. When the Foundation launches (tentatively in first half of 2009), source code will be available for free to all Foundation members.
5. The intent is to move the entire platform to open source in two years.

So what does all this mean ? Well, here are some initial observations :

1. This is an attempt by Symbian to position itself as a compelling alternative to both Google and Apple. Although Symbian has been the leading mobile platform for quite some time (with Linux and Microsoft nipping at its heels), the past twelve months have seen this relatively stable landscape feel a pretty major earthquake with the launch of the iPhone and the Open Handset Alliance.
2. By going the open source route, the Foundation hopes to entice developers to its platform - The Symbian Foundation currently includes Nokia, Sony Ericsson, Motorola, NTT DoCoMo, AT&T, LG Electronics, Samsung Electronics, STMicroelectronics, Texas Instruments and Vodafone among others. A quick scan of the current membership of the Symbian Foundation, the Open Handset Alliance and the LiMo Foundation reveals some players who are in all three - Motorola, Samsung, LG.
3. Microsoft now has its work cut out as it tries to keep justifying the operating system cost of Windows Mobile to device OEMs, while also attracting developers who might feel that their odds of innovating (and making money) are better in less restrictive developer paradigms.
4. As a developer, this introduces more competition in the market at an interesting time - with Google running into some glitches in the launch of Android handsets as reported here and Apple getting its iPhone developer program in shape.
5. However, it doesn’t do anything to resolve the fragmentation in the mobile device platform space that makes application development painful to say the least.
6. My feeling is that developers like the rest of us will try to find the path of least resistance - going with platform that offers the most innovative ways to develop applications, provides access to broadest set of customers, and places the fewest constraints on my business model. Which seems to indicate that unless there are some changes to the Microsoft and Apple models, they might find it difficult to become the preferred developer platform on mobile devices.

Funnily enough, this announcement came out on Symbian’s tenth anniversary. Not to let that go, their website proclaims this announcement as “a nod to the past and a look to the future as the most significant transformation of the company since its inception is announced.“

So, the back and forth regarding what constitutes “open access” continues. In a recent filing with the FCC, Google has expressed concerns about Verizon’s real intentions regarding open access on the C block spectrum it has acquired as part of the 700 Mhz auction. The auction rules had specified that the winner had to support any device running any application on the network.

In the filing, Google says : The Commission’s open access rule is clear that C Block licensees “shall not deny, limit, or restrict the ability of their customers to use the devices and applications of their choice….” The rule also is explicit that C Block licensees may not “disable features on handsets it provides to customers.”The rule thus plainly proscribes a C Block licensee from selling handsets to customers that hinder a customer’s ability to use applications of their choice, and applies to all customers of a C Block licensee.

Google now claims that Verizon is proceeding with its plans to create to create two separate classes of service (interestingly enough characterized as a “two-door” plan) with their part of the “C block” spectrum. According to this plan, Verizon-subsidized handsets with traditional Verizon service would be offered as part of door #1. Consumers wanting to bring their own device and applications will be part of door #2. Google’s contention is is that consumers with subsidized handsets will be offered a restricted set of applications and services (e.g. constraints on WiFi usage, ringtone options, etc.) , which is in violation of the C block licensee rules.

Reading through all the statements and petitions, two things strike me

• What Google is trying to do is have a play on potentially all of Verizon’s handsets (subsidized or not) for the C block spectrum. And trying to force the FCC to make Verizon yield on the subsidized handsets. Because, maybe they dont trust what lies behind door #2. Like say, when the Android handsets for this part of the spectrum come out, the device manufacturers just could spend a lot of time getting the devices certified, which could be a tad bit annoying. Details on the certification process for Verizon’s ODI are still vague at best.

• Verizon, having plonked down $9.6billion (yes, that’s with a B) for the C block licenses, is not going to let this go without a fight. They didn’t spend all this money to just turn it over to all and sundry to cash in. As Susan Crawford notes here, “Where’s the revenue in being a commodity transport provider? VZ is a broadcaster!” Watch for First Amendment claims from VZ in response to the Google petition.”Amidst all this talk about “open”, Verizon has announced their support for the mobile Linux effort, by joining the LiMo Foundation. For now, this is in contrast to the other N.American carriers who have hitched themselves to the Android bandwagon.

And talking about certification and interoperability testing, anyone remember OSMINE ?- No, it is not a place where you go prospecting for valuable operating systems….

Sprint’s WiMAX network, formerly known as Xohm, has now been reincarnated as a joint venture (JV) in a deal announced a few days ago. A multi-headed monster, the JV will include (besides Sprint of course) - Clearwire, Comcast, Intel, Google, TimeWarner Cable, Brighthouse Networks, and Trilogy Equity Partners.

Essentially the infrastructure of Xohm and Clearwire will be consolidated with an infusion of upwards of $3billion from the other parties; with the new company being called Clearwire and Sprint owning 51% of the new entity.

It is instructure to look at some of the background to this announcement to tease out the motivations of the various parties

1. Sprint itself has been going through extremely difficult times, which has seen a reduction in their subscriber numbers, a new CEO, and possible sale of the Nextel business. This deal has been a lifeline for a key piece of their future strategy, as they had been pretty much the only carrier pushing WiMAX in a ‘bet the farm’ kind of way. Without this deal, it is hard to imagine how long Xohm could have gone on, especially when they had already slipped on their rollout plans.
2. Clearwire gets access to a whole bunch of investment and also access to Sprint’s engineering resources (including their WiMAX IP) to help them with their rollout.
3. Google - With all their activity and eventual non-purchase of any spectrum at the 700Mhz auctions earlier this year, Google has now found a relatively inexpensive ($500 million) way to get into the wireless business. By providing the default web and local search on the new Clearwire service, with other offerings like Google Maps, Gmail, etc. preloaded onto Sprint devices on this new network, Google has managed to get itself into a strong position into this new nationwide wireless buildout. Yet another way to add to the advertising inventory, and another place to try out those Android-based devices that should be coming out soon.
4. Intel - As an early promoter and cheerleader of WiMAX, Intel had to figure out a way to make Xohm and Clearwire both viable entities. Since the arrival of their first WiMAX chip (codename Rosedale) and the recent Montevina chipset, Intel has been pushing to get WiMax connectivity built into various parts of the stack - CPE, laptops, mobile devices, etc. Build it (i.e. WiMax chips) and they will come was beginning to get just a little bit dicey for Intel.
5. Cable companies/MSOs - With the experience from their not-so-successful cellular JV, called Pivot, with Sprint, the cable companies had been looking for better ways to add a wireless offering to their triple-play bundle that has been so successful. Here is an interview with Comcast’s Tom Nagel - it gives you the MSO perpsective on this deal.

If you consider yourself moderately interested in the US wireless telecommunications market, you have probably heard something about the recently concluded 700 MHz auction. This part of the spectrum is slated to become vacant with the switch to digital television, scheduled to be completed in February 2009.

And in the months leading upto, during, and after the auction; you also witnessed what could be termed as a wireless telecom version of Sturm and Drang.

Driven primarily by Google’s letter to the FCC last year, a great part of this debate focused on the concept of open - to what extent would this auction ‘open’ up the airwaves ?

It is instructive to understand that that ‘open’ can mean different things to different people. Kind of - Where you stand (on open) depends on where you sit.

• If you are a mobile device manufacturer, you would interpret open to mean the ability to offer compelling devices to end consumers without really having to go through wireless carrier’s seemingly Kafkaesque certification procedures.
• If you are a mobile applications developer, you know that getting applications ‘on deck’ is not for the faint of heart. You want open to mean the ability to spend more energy on cranking out innovative applications and not worry disproportionately about the actual process to getting the carrier to approve the application on their network. The business model for the mobile application - well, that is another issue altogether. Apple’s recent announcement in the wake of its iPhone launch is a first step in simplifying the application/content discovery and business model for mobile applications.
• And when it comes to us poor consumers, we would like to BYOD - bring your own devices (and any other software/application with it). We want to use the devices we like with the carrier+calling plan, as opposed to using only the handful of devices that are available to us under the current model of carrier-locked devices for most calling plans.

Now, lets talk about the carriers themselves. After a great deal of back and forth, including Verizon suing the FCC on its open access rules for the auction, they have now made pronouncements that indicate an opening up of their networks to some degree.

Verizon Wireless launched their ‘Open Development Iniative (ODI) ‘ with much fanfare, promising to allow any device and any application to access their network. Under this program, devices are supposed to take 4-8 weeks to be approved by Verizon - potentially a dramatic reduction in the approval process.

What the costs will be for such an approval is unknown, as is the kind of data plan such a device would need. Part of the ODI launch is the intriguing possibility mentioned by Verizon about non-traditional devices (e.g. vending machines, gaming consoles, etc.) being able to connect to their network. Seems like a good way to hedge your bets in the M2M market, something I will visit in a future post.

AT&T however, insisted that their network had always been open - i.e. you could use any GSM device on the AT&T network.

And for those of you waiting with bated breath for WiMAX, Sprint announced their plans to release an SDK and open APIs (by the end of 2008) for Xohm - their WiMAX network. They are hoping to entice developers and hardware manufacturers to tie into the hooks for things like location services, device management, identity, and QoS and build some interesting (and hopefully revenue generating) applications.

Does this mean that the open access holy grail is just around the corner ? Not so fast - the wireless stack is one that wireless carriers have a great deal of incentive to control for as long as they can. Because with the control comes a large share of the consumer’s wallet.

However, it does seem like the degree of control they have historically exercised is slowly being eroded - it is interesting to note that it took someone with the muscle of Google (although not acting in a completely altruistic fashion) to initiate this process. I think the first real test of this will be when the first set of devices based on the Open Handset Alliance platform hit the US market - sometime by the end of 2008.

May we live in interesting times..