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Siemens Takes Stake in Symbian

Light Reading
LR Mobile News Analysis
Light Reading
4/23/2002

The Siemens Information and Communication Mobile Group (IC Mobile) is the latest major handset vendor to take a stake in smartphone operating system vendor Symbian Ltd. London-based Symbian now has virtually all of the major handset vendors on its roster, so where are the devices?

Siemens said at the Symbian Developers Expo in London on Tuesday that it has stumped up €22.8 million (US$20.26 million) for a 5 percent stake in the venture. “[This is] a clear signal to the market and all application developers,” said Rudi Lamprecht, member of the managing board at Siemens AG, in a statement. “Having licensed Symbian OS for our smartphone development last year, now we also want to take the chance to strongly influence the open standard for smartphones.”

Siemens Mobile taking a stake means that Symbian now boasts four of the world’s top five handset makers in its ranks. Nokia Corp., Motorola Inc., and Sony Ericsson Mobile Communications all have stakes in the company. Psion PLC and Matsushita are the other shareholders.

“Symbian has some great technology -- it was building on the solid foundation of Psion's EPOC OS -- and is well poised to dominate the smartphone sector,” says Seamus McAteer, senior analyst at Zelos Group. But where are the fruits of that technology? Symbian lists five handsets as “Open Symbian OS phones” on its Website -- and three of those are “coming soon."

An unscientific survey of the local mobile phone stores near Unstrung’s office in downtown Manhattan revealed precisely zero Symbian-branded devices on sale. Symbian was established in June 1998, and since then only one device that it is happy to call a Symbian smartphone -- the Nokia 9210 Communicator -- has come on the market.

Where the product is actually available, it does well against rival OS offerings from the likes of Microsoft Corp. and Palm Inc. IDC says that Nokia’s Communicator has been the top- or second-best-selling handheld in Europe for the last couple of quarters. Not bad for a device that typically retails at well over $500.

But the Communicator has attained semi-mythical status outside of Europe, cruelly kept behind glass at trade shows, the subject of hushed whispers among the gadget-hungry masses. “Symbian’s share of the U.S. and Asian markets is not discernible at this time,” McAteer says. He reckons that Nokia and Ericsson devices will arrive stateside later this year.

At least one of Symbian's partners has been here before. Once upon a time, EPOC developer Psion was a force to be reckoned with in the personal organizer market, but it couldn’t break out of its European stronghold and sell into the U.S market. So last year, it withdrew from the handheld market it helped to create, with its tail between its legs. In theory, this couldn’t happen to Symbian, since the handset companies that back it already have global channels to shift product. But Symbian cannot afford to let the grass grow under its feet. Microsoft is aggressively targeting operators with devices based on its Smartphone 2002 OS.

In fact, McAteer says the strength Symbian has because it's backed by the leading handset vendors could also help to explain some of the problems the company has with execution.

“Managing the competing priorities of its sundry investors" is Symbian’s toughest challenge, he says “That challenge just got tougher with Siemens’ commitment. Symbian's lack of autonomy has already cost it two good CEOs -- most recently, Colly Meyers, who left a few days before the most important event of the year, the 3GSM World Congress in Cannes."

The remainder of this year is likely to show whether Symbian can make it in the market. All the elements are in place for the company to take a lead in the smartphone OS market. “Always-on” networks are available in Europe, Asia, and the U.S. Corporate customers are looking for a device that does more than wireless email and text messaging, and operators want to sell it to them (along with a juicy wireless data long-term service contract). But Symbian faces brutal competition from Microsoft and others in this market, so we’ll just have to wait for the smartphone to drop to see how this one plays out.

— Dan Jones, Senior Editor, Unstrung
http://www.unstrung.com

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