News
Issue #2003 - 25 (September 2003)
(Updated Sept. 12, 2003)

ACQUISITIONS, MERGERS & AGREEMENTS

Motorola to Exit Symbian

Despite just releasing a phone based on the Symbian operating system, Motorola Inc. said it will exit the OS venture. 

Nokia Corp. said it and Psion plc have begun procedures with Motorola to transfer Motorola’s shares in Symbian to Nokia and Psion. 

Once the transaction is completed, Nokia would increase its shareholding from about 19 percent to 32 percent, and Psion would increase its Symbian ownership to about 31 percent. Nokia said the transfer would not affect Motorola’s existing licensing arrangement with Symbian. 

Nokia said the transaction values Symbian at about $470 million. 

Motorola said it would continue to support the Symbian OS for specific customer and business needs, such as its third-generation devices. “However, our primary software focus for the mass market will stay centered on Java, which is also supported by Symbian,” said Scott Durchslag, corporate vice president of Motorola’s Personal Communications Sector. “We believe Java is what ultimately provides our customers worldwide with the most optimized and differentiated mobile experiences.” 

Nokia, Motorola, Psion, Siemens AG, L.M. Ericsson, Panasonic and Samsung formed Symbian in 1998 to develop an OS for advanced smart phones. The company is just beginning to see the first major fruits of its labor, with Symbian reporting last week that Symbian OS unit shipments grew in the first half of the year to 2.68 million from 230,000 in the same period last year. Its royalty revenue increased to $16.2 million in the first half of 2003 from $2.4 million in the same half last year. 

Motorola has been looking at options outside of Symbian for months. The world’s No. 2 mobile-phone maker earlier this year announced major support for the Linux/Java operating system and said it would include the technology in a majority of its devices. In addition, Motorola has been rumored to be working with Microsoft Corp., Symbian’s main competitor, on a phone using Microsoft’s Smartphone OS, although both companies have declined to comment on the rumor. 

Interestingly, just yesterday, Motorola released its first phone based on the Symbian OS. Motorola and 3G operator 3 together introduced the Motorola A920 3G handset featuring a full-color widescreen display designed to showcase video calling capabilities and video content. 

Source: RCRNews

MobileInfo Comments and Advisory: Motorola's exit from Symbian partnership may have more to its corporate strategy and warming up to Microsoft. While Symbian is undoubtedly the strongest OS for 3G devices, role of OS is less important in smart phones than in PDAs and notebooks. Third party application support is not as crucial there because PIM and messaging applications can be very easily integrated into any operating system. Remember that Motorola and Nokia churn out millions of handset devices every year. We do not expect pre-eminence or complete dominance of a single smart phone OS for some more time to come.

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