Does the mobile OS matter?

Yes and no.

But mostly no. It doesn't matter the way the OS companies want it to.

Recently two telecom analysts in Europe published essays saying that there isn't going to be a winner in the mobile OS wars. The UK research firm ARC Chart wrote, "far from the market consolidating around one or two of major OS platforms, the number of middleware systems for which applications can be developed for is actually increasing.... The mobile OS story is no longer simply about a war between Microsoft and Nokia."

(Actually, the story was never simply between Microsoft and Nokia, even if you're watching only the European market. But that doesn't invalidate their main point.)

Then analyst Dean Bubley chimed in: "Let's face it, heterogeneity in mobile phone OS is permanent. At the bare minimum, Nokia will continue to champion Symbian, Motorola will push Linux, HTC is making a good living with Windows Mobile, and assorted proprietary OS's continue to make traction because consumers don't care.... OS diversity is a baseline. Most manufacturers recognise this, and most mobile operators as well."

Unfortunately, ARC Chart went on to theorize that middleware software platforms are going to take on the standard-setting role that the OS was supposed to play. They cite products like Brew, Savaje, and Action Engine as examples.

I don't think so, not if they behave the way the mobile OS vendors have behaved. I think the most important words were Dean's: consumers don't care. I wouldn't make the statement so categorically, but I think it is true that most customers don't care. Here's why.

The PC fallacy

As I mentioned in my post on the Myth of the Smartphone Market, one of the most common mistakes made by people in the mobile industry is assuming that their market will work like the PC market does. More often than not, it doesn't. If you use PC assumptions and PC reflexes to run a mobile company, chances are you'll lose your shirt.

This is why people who've worked a long time in the few really successful mobile data companies, like RIM and Palm, sometimes come off as smug and dismissive when they get advice from outsiders. If you approach them from a PC perspective, they'll tune you out faster than I tune out country music when I run into it on the radio.

One of the most basic assumptions of the PC world is that one OS eventually wins. Even if two operating systems start out even, one of them eventually gets a little better sales. Seeing a better chance of selling applications on that platform, more developers concentrate on it. The higher number of apps brings in more customers, who draw more developers, who attract even more customers. The process feeds off itself, and pretty soon one OS has 90% of the market and the other is called Macintosh.

For years almost everyone (including me) assumed the same effect would operate in mobile devices. But does it? Let's look at the evidence.

At the end of the century, the Palm OS took a commanding lead in mobile application development. The company's developer base grew from about 3,000 registered developers in 1998 to 23,000 in 1999 to 130,000 in 2000. The application base grew at the same rate, vastly outstripping everything else on the market. By all the rules of the PC market, this should have been the end of the game. As licensing increased the base of Palm OS devices, every other mobile platform should have been wiped out of existence.

But it didn't happen.

There are a lot of reasons why. Microsoft and Nokia were both willing to endlessly subsidize competing platforms, for example. But another key factor was that the "network effect," the bandwagon process in which a leading platform sucks up all the customers, simply didn't work. The users didn't behave the way they were supposed to.

It's the solution, stupid

What are the two most successful smart mobile devices on the market today? iPod and RIM Blackberry. What operating systems do they run?

Uh, well...

Last I heard, the iPod runs a mashup of software from Portal Player and Pixo. RIM runs its own embedded OS (I don't know if it's proprietary or derived from an outside product), plus Java. Neither of them have fully mature software platforms with a large range of third party applications, and yet they outsell the products that do.

"Wait," someone might object. "Those products just sell the best because they work best. If someone had a really good product on an open operating system, it might sell the best." And that's exactly my point. In PCs, the industry-standard operating system can propel even inferior hardware designs to leading sales (ask any Mac owner). The PC OS generates demand. In mobile devices, the "solution" – the device's main functionality – is usually what generates demand. The mobile OS doesn't matter. Or a more accurate statement would be, something else matters a lot more.

This wouldn't be as much of a problem if the mobile device companies were good at creating mobile data solutions on their own. Then they'd pick the OS with the best plumbing and build a great product on top of it. The OS still wouldn't matter to most users (it would be equivalent to a no-name embedded RTOS, something like TTPCom's Ajar or OpenWave's client software), but at least you could count on it to be an element in the best mobile devices.

Symbian has tried to follow this route. It's owned by mobile phone companies, and they generally don't want it to have anything to do with creating end-user value – the phone companies, particularly Nokia, view that as their turf. The restrictions are so tight that Colly Myers, former head of Symbian, says the company shouldn't have even tried to create a user interface for its product.

But most mobile device companies, especially the big ones, are terrible at creating integrated hardware-software solutions. They're hardware companies, not software companies. The mobile operators are little better; they generally understand voice but not data. So you get a three-way traffic jam of OS vendor, hardware company, and operator (if the device is a phone), none of whom are in a position to architect the whole solution and make mobile data sing.

I do think there's hope for an application platform to establish itself as a standard in the mobile world, but it needs to be structured and managed differently from anything that's on the market today. I'll write about that later this month. In the meantime, the industry needs to understand that smart mobile devices today are basically appliances. Most people buy them to solve one major problem in their lives, and they'll favor the device that is the best solution to that particular problem. Blackberry is the best solution for mobile e-mail, so people buy it even though it sucks at almost every other function. iPod is the best solution for mobile music, so people buy it even though it can't do much of anything else.

There are a relatively small number of users, like me, who care so much about having a multifunction mobile device that we'll pay more and compromise on other features (such as weight and simplicity) to get it. The Palm OS ones are very loyal to Palm OS, and the Windows Mobile ones are very loyal to Windows Mobile. Although we're very noisy on the web, we're actually a relatively small percentage of the population. There aren't enough of us to create the sort of mass horizontal market the consumer electronics and phone companies are looking for.

Does that mean mobile operating systems are dead? Nah, but if the OS companies want to have a major impact on the market, they need to step up to providing full solutions to major user problems, rather than just plumbing. Picture a version of Windows Mobile that includes a well integrated system for downloading and playing music. Or a version of Palm OS that comes bundled with a great corporate e-mail solution and software to handle attachments. Those mobile software products could sell well. What's dead (or at least uninteresting and low value) is mobile operating systems that try to succeed by just being great infrastructure. That worked in PCs, but it won't work in mobility.


Anonymous said...

Really in line with you, see my comments here :

Anonymous said...

REALLY enjoying your blog, Michael. You're formulating a lot of ideas that I've been struggling to articulate for a while.

Jim Kayne said...

Hi Mike -

Reading your thoughts on mobile OSes, and the links to ARC Chart and Dean Bubley articles, the question that arose was whether there's an approach to the intertwined problems that's "smart enough". I agree: mostly, users don't care about the OS.

From the operator side of the equation, there's a number of problems with OSes, that stem from proprietary systems, and developmental difficulties associated with them. Whether you're talking SavaJe, Symbian, Linux, or MS Mobile, it's first a question of market segment - and we have, by exclusion, addressed the largest segment: not the savvy high-end SmartPhone user, but the less discriminating Feature Phone user. A choice from any of these OSes is really a choice for different sets of tradeoffs: development costs, adaptability, IP costs, etc.

I suggest that will always be the case

Your article doesn't state explicitly what the desired featues in this segment are, beyond voice, but they're fairly clear to most industry observers - email, messaging, and then, various combination of other features, such as listening to downloaded tunes.

For the operator, it would be helpful if these features are married to a "menu" of common features, which can be quickly added by the operator - without months of development time, consultants, or OS tinkering.

The dream scenario for the operator, (and of course for the end-user desiring this or that feature, but not caring about the OS) is that the most widely-used features from the menu could be quickly coded and activated.

What we're speaking of is a question of degree: I don't suppose anyone is suggesting any mobile OS can be all things to all people. At some point any sufficiently complex development will invoke costs. But it would be immensely helpful to have minimal cost and time devoted to selection from the "menu" of widely-used features.

ARC Chart makes reference to Intrinsyc's new OS, which has since emerged with a name: Soleus. The OS uses a stripped-down subset of Win CE components. In demonsrations at Cannes and Barcelona, audiences were polled for suggestions. The suggestions were then coded into the handset/OS, the handset was activated, and a call was made using the requested features. In real time.

The end user may be OS-agnostic, but the operator certainly isn't. There's an operator market segment that needs to be properly addressed by an OS, which allows them to cost-effectively meet the needs of end-users. SavaJe illustrates that some operators were willing to commit millions to developing such an OS, and freeing themselves of legacy/proprietary issues and development costs. The promise of "write once, run everywhere" still comes with some tradeoffs, however.

This is a serious inquiry as to whether many of the needs you and others have touched on haven't been satisfied by this new OS.

I'd appreciated any informed comments.

FYI, a couple of links:


Jim Kayne

Michael Mace said...

Thanks for the interesting comment, Jim, and I'm sorry I was slow to respond to it.

>Your article doesn't state explicitly what the desired featues in this segment are

I go into that one in depth in my post on the "Myth of the Smartphone market." You can see the link at right, under "favorites."

I agree strongly with the idea of a provisioning system that can push the apps that a particular user wants onto the device. But some functionality also requires hardware changes, or a deeper change to the OS. Those things would be hard to provision to a device on the fly.

I haven't had a chance to try Soleus, so I can't say much about it. The presentations seem reminiscent of things I've seen for products like Obigo. The focus is on helping phone companies provision various software components to phones, not so much on customizing them for users after purchase.

Better provisioning is interesting and needed, because phone manufacturers have a huge problem with non-reusable code. So I think there's a place for products like this.

I don't buy into the whole feature phone vs. smart phone philosophy, though. I believe customers don't think that way. You can read more about that in the post I mentioned above.

>>This is a serious inquiry as to whether many of the needs you and others have touched on haven't been satisfied by this new OS.

Nope. It's an improvement, but not the full answer in my opinion.

Anyway, good comment, and thanks for sharing it.

Jim Kayne said...

Mike, thanks for your reply.

"I don't buy into the whole feature phone vs. smart phone philosophy, though. I believe customers don't think that way."

Agreed. It's an industry descriptor for a market segment. And a moving target, at that.

In the context of your other comments, and an increasingly fragmented market your reply makes perfect sense.

Soleus will be invisible to users. In comparison to devices such as Blackberry and IPod - Soleus handsets will be relatively boring.

But as you note, the OS does address some known needs. It will be interesting to see the how it fares.


Anonymous said...

I find your comments very illuminating, unlike much of what is written in this area.

Michael Mace said...

The comment above was removed at the author's request. Sorry.

Text to Screen said...

I just got my fiancee a Blackberry Pearl, and I'm trying to figure out what application platform it runs. Does anyone know of Blackberry Bit Torrent Sites where you can get games and applications for it?

text to screen

Daniel Shugrue said...

Hi Mike -- Good food for thought. I have two comments:

1) You make a couple references to the fact that consumers don't care about the OS, and if you are talking about the mass market of consumers, I couldn't agree more. However, I'm not sure I would agree that what the consumer cares about defines what "Matters". An analogy would be the music industry -- do record companies matter? Not to consumers of pop and rock. But do record companies matter? Absolutely. They matter to immensely to artists in terms of the support they can/can't give in terms of promotion, distribution, recording, etc. And the support they give to artists indirectly matters to consumers, even if consumers are not aware of the difference between, say, Warner and Sony music. The same holds true for Mobile OSes. Consumers don't have to know about the Mobile OS in order for them to matter to devices manufacturers and mobile application/service developers. But the fact that the mobile OS does matter to the device manufacturer as well as the service provider does, in the end, matter to the consumer, in terms of the price of the product and the services the product offers, even if the consumers doesn't know *why* their RIM/Palm/Windows/Symbian-based product can do the things it does.

2) You say that the two most successful mobile products are the iPod and the Blackberry. I assume you mean the whole family of iPod products (iPod, Video iPod, Nano, etc) Both of these families of products are successful, but neither is nearly as successful, in terms of volume sales, as products based on SSymbian OS and the S60 platform. Over 100 million S60-based phones have been sold. Granted, most consumers do not know that they are using an S60-based phone. But does it matter if they don't know? I'd argue that for the companies using the OS to create devices which there is clearly strong consumer demand, it matters a great deal.
-Daniel Shugrue
Nokia Software Platforms Marketing

Anonymous said...

Mike, I agree with David Beers you are formulating a lot of complex ideas flawlessly. I'm loving everything I've read here tonight.

My only question about this article in particular is, what about the cloud?

I mean this is just another reason why most people won't care about mobile OS's. As the web develops, and as mobile hardware develops, and the connection speeds and so on and so forth, won't most applications be part of the cloud anyway? The need for OS-specific software is dying. You only have to look at google docs to see that.

In summary I see mobile OS's in the future really as more of a means to connect to the internet than anything else. The only difference between them will be what browser they're running.

Just my 2 cents. Great work on the blog i look forward to reading more.

Michael Mace said...

Hi, Anonymous.

Thanks for the comment. I agree with you about the cloud -- because it can be a consistent platform across mobile devices, I thin it eventually wins as the dominant platform for mobile app development. The trick is predicting when that will happen -- the iPhone has given a lot more momentum to native mobile app development at the moment.

I wrote some more about the fate of mobile app development here.