1998 to 2001: Genesis
In 1998, several mobile handset manufacturers gathered around to bid for British company Psion’s embedded operating system, code named “EPOC”. Psion was a PDA manufacturer then, and EPOC was their transition from 16-bit to 32-bit operating systems. The consortium of companies, consisting of Nokia, Motorola, Ericsson, NTT Docomo & Sun Microsystems acquired the EPOC operating system, along with key personnel of Psion, and formed Symbian Ltd. Motorola later left this consortium, and was replaced by other firms like Panasonic, Sony-Ericsson & Samsung.
So why did competing companies come together & agree on a common operating system? To answer this question, one has to look into another industry that closely resembles the smartphone industry – Personal Computers (PC’s). In the PC industry, the computer manufacturers have been reduced to un-differentiated hardware factories, who need to depend heavily on two powerful suppliers – Intel & Microsoft. As any competitive strategy model would tell you, if an industry has high dependency on a few suppliers, and cost of switching from these suppliers is high, then the industry is not an attractive one to be in. Very few consumers would think “Oh, I need to buy a Dell PC”, or “I will buy a Leneno, and not other brand”. The Microsoft OS brand and the Intel processor brand far outweighs the importance of the PC manufacturer brand.
Since the mid-ninties, Microsoft had always had it’s eye on the embedded devices industry, and how to get it’s Windows operating system on these devices. Back in 1996, Microsoft introduced an operating system for embedded devices, known as “Windows CE”. At that time, it was aimed at the PDA (Personal Digital Assistant) market, which was dominated by Palm. Clearly, Microsoft’s strategy was to get their operating systems on as many kinds of embedded devices as possible. Smartphones were naturally one of their main targets, as they had correctly predicted the boom in this industry in the coming years. One of the main reasons the mobile handset makers got together was to counter the threat of Microsoft’s aggressive forays into their industry. Mobile handset manufacturers did not want to have the same fate as the PC manufacturers. A Microsoft-dominated smartphone industry would not be good for anyone.
2002 to 2006: Growth
Symbian was, at that time, an order of magnitude better than the competition (Windows CE). It was also licensed in far better terms (considering that it’s shareholders were also licensees) than Windows CE. This was reflected in the growing market share in the next few years.
Sybmian charged around 4 to 5 US dollars royalty for every handset. Microsoft has been estimated to charge between 15 to 25 US dollars for the same, making it much more expensive. Symbian also followed a source code licensing model, making it easier for licensees to customize the OS according to their own wishes. Microsoft’s licensing was in stark contrast. - object code, with no possibility to modify or customize anything. As David Wood, ex-EVP of research, Symbian Ltd. said,
“Innovation is not the fruit of a single company, it’s the collective outcome of the ingenuity and freedom of an ecosystem that is attracted to the potential of a richly open platform.”
Symbian First Half 2007 review
Whether David really believed this or not, it was (and still is) true. We may now have a fruit company ruling the smartphone industry, but that does not mean that a closed proprietary system is the way to go. Symbian’s open & affordable licensing paid off, and global market share grew phenomenally to touch 70~75% in 2007. But the downfall started after 2007.
2007 to 2010: Decline
While Apple’s 2007 iPhone launch did not dent Symbian market share much, as it was then available only in US, Google’s Android (launched in 2008) started the real downfall of Symbian. In mid-2008, Nokia announced that it would acquire Symbian, and make the OS available in an open source model. This was clearly aimed at taking on the open source model that Google followed with Android. This decision to open-source Symbian came at a time when Symbian was rapidly losing it’s market share.
Probably what was happening was that the smartphone market itself was expanding, as demand grew, and handset manufacturers were pushing more smartphones vs feature-phones. Apple’s entry in 2007, followed by their expansion globally fuelled the demand for high-end touch screen smartphone. But the main competition came from Google’s Android, which was responsible for taking away a major share from Symbian.
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