Mobile Terminal OS Competition

1. Mobile Terminal OS Competition Ville Lehtonen, 49515B

2. Scope and agenda • The Market in general • The Operating Systems • Symbian • Windows Mobile • Palm OS • Linux (Montavista) • Other Stakeholders • Brand • Conclusions

3. Mobile Operating Systems • Mobile phone performance has increased drastically in the last 5 years • Color screens • Cameras • Up to 80 Mt of memory • The need for a real operating system is obvious • Marketplace is too big for any major player to ignore • Considerable synergy with other systems • PC, consoles

4. The current market status • PDAs were still the bigger market in 2003, but smart phones will probably beat them in 2004 • PDA sales roughly 10 million a year • 5.3% to 17.9% drop in PDA sales in 2003, depending on source • 60% Symbian, 22% Palm OS and 6,6% Windows in April 2003 (ARC Group, 2003) • The potential is immense • 1.29 billion mobile phone users in September 2003 • 100 million data users in Sept 2003 • Mostly in Korea and Japan • Number of smart phones estimated to reach 45 million by 2007 (ARC Group, 2003)

5. Symbian • Founded by Nokia, Ericsson, Motorola, Panasonic and Psion • However Nokia now owns 63,3% of Symbian • Designed for mobile systems • Small memory footprint • Minimal battery consumption • Minimal hardware requirements • Over 10 million phones using symbian sold by 2003 • Massive industry support • 2,090,000 google hits

6. Windows Mobile • Windows CE name evolution • Windows Smartphone • Pocket PC • Windows Mobile 2003 • Dominant in the PC industry • Does not manage power as well as Symbian or Linux • Significant industry support • Compaq, Dell and Motorola • 3,230,000 google hits • Used “Windows CE”

7. Palm OS • PalmSource, Inc • PalmOne makes hardware • Overall market leader in PDA / Smart phone OS • Over 30 million sold • 20 000 software titles • Expanded to the smart phone market with the Treo product line • Product of Handspring, which Palm bought • Had a 22% share of the market in early 2003 • Has most likely gone down • 3,550,000 google hits

8. Linux based Operating Systems • Montavista Linux CEE by Montavista software is the most serious entrant • Open Source • Low Industry support • Most of it is coming from the far east • Motorola balancing between Windows and Linux • Boasts dynamic power managements • But not much else • Has lost the price advantage • 113,000 google hits

9. The Hardware Industry • Mobile phone producers behind Symbian • Nokia, SonyEricsson, Panasonic, Motorola, Samsung, Lenovo (China), Siemens, NEC, Toshiba • Palm OS • Samsung, Sony, PalmOne, Foundertech, Kyocera, Lenovo • Windows Mobile • Compaq, Motorola, Samsung, Philips, Fujitsu, Orange • Linux • Motorola, Nexterm, ELT, Samsung, Sony, Panasonic, Philips, NEC, Toshiba

10. Software producers • Software makers can make or break OSs • Has been seen before • All the systems are open • Windows software dominates the market • Linux presence negligible • Palm even worse • Symbian nonexistant • Convergence will favor the incumbent Microsoft • Switching costs are already lowest when using Windows Mobile

11. The Gaming Industry • Significance to OSs experienced on the PC side • I-Mode proof that it works in mobiles as well • Games a huge market in their own right • A three way struggle with linux sitting on the sidelines • Massive competition for MMO games for all systems • Palm participates by emulating Nintendo • Will Sony support Symbian?

12. Presence Services and Finances • Presence services and digital identity growing • Verified by Visa • Microsoft Passport • Instant messaging, E-mail on the side • Liberty Alliance • Symbian shareholders with Sun, Intel and others • Getting users is the key • Who will benefit from the convergence? • Credit Card companies, Banks, OS creators, Mobile phone producers, Instant messengers, ISPs? • Will all even survive the process?

13. Telco’s and ISPs • Microsoft control of mobiles might allow it control of the VoIP market • How will the Telco’s react? • Billing becomes increasingly difficult • Microsoft or Nokia ambitions in the presence services troubling • Telco’s and ISPs lose a lot of potential revenue • NTT Docomo, Sprint, Nextel, TeliaSonera among the Telco’s in Liberty Alliance • AOL, Jabber from the internet side • What is left for Telco’s and ISPs?

14. Governments • Digital citizenship for payment purposes allows effective taxation by companies • What’s new? Banks have done this before • Might grow to involve all commerce • Which makes it bigger than banking • Winner-takes-it-all seems unlikely to be allowed • Personal information becoming a commercial product • Not new, but might grow to new dimensions • To what degree will the government allow it?

15. Brand • Differences in the Operating Systems relatively small • The mass market will be won or lost on an emotional level • Microsoft and Nokia the strong brands in the market • Nokia might be a brand name, but Symbian is not • Microsoft #2, Nokia #6 • Many other players have strong brands • Sony, HP, Samsung, Ericsson, Panasonic etc • “Everyone knows Microsoft never loses” • Linux has a niche market feel to it • Relatively poor mass market awareness of Palm OS

16. Conclusions • Brand weight in the market is massive • Microsoft and Nokia dominant • Nokia lacking on the software front • Sony and its gaming empire in a key position • How can interoperability with Microsoft dominated desktop machines be guaranteed? • Linux does not have much going for it • Nor does Palm OS • Hard to tell which way the Far East will go • Might be most significant of all with China’s 260 million users • Lots of local solutions already (I-Mode)