New "open mobile" architecture could unify wireless market: some see a closed door admission policy by Nokia.

At Comdex, consortium of chip makers, mobile phone vendors, and wireless carriers announced a new initiative for a so-called "open mobile" wireless architecture. The new platform, a somewhat hazy combination of client-side and back-end software standards could, in theory, both standardize the fragmented mobile OS market and at the same time give the mobile phone industry a much-needed infusion of application development.

The consortium, led by phone giant Nokia, was initially greeted with skepticism by the media and industry analysts, many of whom noted the lack of a major software developer among the list of participating companies. But at the end of the year, Nokia announced that a number of heavy software hitters--among them Oracle, Sun, and BEA Systems--have signed on, potentially giving open mobile critical application support and new relevance in a market stung by poor 2001 sales numbers and lackluster demand for advanced, high-speed services.

Grand Opening

The open mobile architecture (it still lacked a formal name at press time) is an attempt to avoid the plague of proprietary software standards that has fragmented other markets (think PDAs and digital audio, not to mention operating systems) and give consumers the ability to use a single phone across the planet and at the same time take advantage of a globally-available set of services while doing so. The consortium's founding companies include a broad cross-section of phone OEMs and carriers, and include AT&T Wireless, Cingular Wireless, MM02, NTT DoCoMo, Telefonica Moviles, Vodafone, Fujitsu, Matsushita, Mitsubishi Electric , Motorola, NEC, Samsung, Sharp, Siemens, Sony, Ericsson, and Toshiba (as well as the aforementioned Nokia).

Look closely, however, and you'll notice a glaring omission: Microsoft, and any other large independent software vendor. In fact, the sole software company named in the initial announcement is Symbian, which develops the operating system used in Nokia phones (among a few others). While according to company literature Symbian is ostensibly a "private, independent company," in reality it is an arm of several powerful phone and chip vendors, and is jointly owned by Ericsson, Matsushita, Motorola, and Nokia, (as well as Psion).

Critics of the open mobile initiative had contended that, since Symbian was the only software name in the group, the initiative was simply a thinly-veiled attempt by the Symbian backers (and Nokia in particular) to control the operating system market for mobile phones. Suspicion grew as Nokia announced that it would license Series 60 (its mobile OS based on Symbian) to other phone makers.

In particular, critics questioned the lack of support from Microsoft. Redmond has its own phone OS, Stinger, and is also angling for a piece of the mobile pie. Any initiative that truly seeks to unify this market, went the logic, would need to include Gates & Company to avoid a fractious standards battle, a divisive war which would have few winners and many corporate and consumer losers.

"Nokia is passionate about keeping Microsoft out of their space," contends Gartner analyst Ken Dulaney. "This standard really isn't a standard at all: it doesn't even have a name yet," Dulaney notes. "It is fundamentally a standard for Nokia phones, although other companies may use some pieces of it."

Nokia disagrees. According to Nokia officials, open mobile will "provide consumers with a wide selection of different competitive, yet interoperable terminals and services, and hence promote significant industry growth, and also aim to ensure that economies of scale are enjoyed throughout the industry." The company contends that far from being an attempt to control the OS market for phones, open mobile seeks to make the relatively closed market available to a number of different vendors using standard, industry-accepted technologies.

"The goal of OMA [the open mobile architecture] is interoperability: to get manufacturers to commit to a standard set of technologies so that applications residing on a phone can share data with other devices," says Randy Roberts, Director of Digital Convergence at Nokia. Roberts does admit that there has been some confusion because of the Nokia announcement--separate from the open mobile initiative--that it is licensing its Series 60 OS to other manufacturers; Series 60 is based on Symbian.

Nokia announced in December that BEA, Borland, HP, IBM, Oracle, and Sun would join the group, and that all have agreed to work with network infrastructure companies to create mobile services using J2EE application servers. Nokia says that to facilitate the specification process for J2EE APIs, the companies have agreed to jointly prepare the specification proposals prior to submitting them to the Java Community Process.

Devil In The Details

Specifics on precisely what technologies open mobile will include, however, are in short supply. The group has said in press materials (and Roberts confirms) that it will make use of WAP2.0/XHTML, MMS (Multimedia Messaging Service), SyncML, and other 3GPP-compliant technologies. The proposed set of technologies would work over GSM networks, which are currently just being rolled out in this country, and presumably over GPRS (General Packet Radio Service) as well.

Open mobile comes on the heels of the M-Services initiative, announced in June of last year (see the July issue of CTR). M-Services is working to create a standard set of universally available protocols and services for wireless devices that are consistent among carriers and phone makers. It is supported by the entire membership of the GSM Association, which is responsible for the evolution and deployment of all GSM technologies (GSM, GPRS, EDGE, and 3GSM). Several U.S. carriers, among them AT&T, Bell South, Omnipoint, Pac Bell, and VoiceStream, also have announced support for M-Services.

Other features of the new open mobile standard, including specifics on what it would mean for consumers, remain undefined. This makes some observers wary. "I don't think it's going to be broadly adopted," says Gartner's Dulaney. "Certainly Microsoft won't adopt it. The issue is that you need standards when the separate pieces [of the technology] are more developed. This is the problem that WAP had." Dulaney feels that open mobile will simply be a standard for Symbian-based phones--not necessarily a bad thing, but far from a universal standard. "Even if it is just on Symbian phones, you'll still see some benefit: cost savings in application development, for example."

Other analysts agree that there is value in widespread use of Symbian, regardless of whether or not Nokia's motives are truly to open up the mobile phone OS market. "Symbian is popular in Europe, and Nokia, being a European company, probably felt more comfortable working with the Symbian folks," says Allen Nogee, Senior Analyst for Wireless Component Technology at Cahners In-Stat/MDR. "Symbian is a really good choice for a smart phone: It was designed from the start for smart phones, has less overhead than PocketPC, and ultimately allows Nokia to put out products quicker than if [the company] were to use PocketPC."

In some ways, open mobile may be analogous to BREW, a Qualcomm OS initiative for CDMA-based phones. (See the March, 2001 issue of CTR for a full discussion of BREW technology, available at www.wwpi.com). Since Qualcomm makes the CDMA chips, it benefits directly (and doesn't hide this fact) from developers who use the open-source BREW to write phone applications. Similarly, Nokia stands to gain if companies license a Symbian-based open mobile infrastructure as their platform of choice. ("Open mobile is a great way to get Symbian onto mobile phones," says Gartner's Dulaney, only half joking.)

The difference is that claims that open mobile is, well, open, just don't ring true. Companies with competing operating systems (Microsoft is just one example) are not members of the consortium. For example, the Palm OS, the most popular PDA operating system and one now found on mobile phones from companies like Kyocera, is not represented in the initiative (neither Palm nor Handspring are members). Any mobile phone initiative that seeks to define itself as "open" would seem to demand that multiple vendors with mobile operating systems participate.

"Nokia's open mobile initiative is one in a very long line of phone consortiums, from WAP to Symbian," says Michael Mace, chief competitive officer at Palm Inc. "Every time one falters a new initiative is declared. Palm-powered smart phones from Samsung and Kyocera are selling extremely well, and we are very excited about the upcoming Handspring Treo and new wireless products from other licensees," Mace adds. "The Palm platform continues to gain momentum in the smart phone market while the other guys are still talking."

Nokia's Roberts admits that Palm, Handspring, and Microsoft were not invited to join the group but--without naming names--says he expects to see other software companies make some announcements in the near future. Roberts notes that Microsoft, for one, would be welcome to join the open mobile initiative, assuming the company committed to the open standards supported by the group. Still, he says that Nokia believes that by 2004, fifty percent of 3G devices will be based on Symbian, a result that Microsoft et al would presumably be less than thrilled to see develop.

Because its strengths lie in phone software and not in the PC world, Nokia is seeking to create a universal platform for mobile communications that it can still control to some degree. It's probable that the company may fear (and rightly so) that opening its phones up to Windows may in the long run pull Microsoft into the wireless space while at the same time relegating Nokia to the sidelines.

"It's not a secret that Nokia and Microsoft are not the best of friends," says Cahners' Nogee. "Nokia knows that if it allows Microsoft into its handsets, Microsoft will attempt with PocketPC for handsets [Stinger] what it has done with Windows for PCs. The hardware will be relegated into just something supporting the operating system, and that certainly isn't in Nokia's best interest." Nogee also points out that Nokia realizes that Microsoft has little experience in the wireless arena, and it is experience that Nokia would rather not hand over to Redmond.

But Nokia's vision of an open mobile environment separate from the existing world of Windows may be the way of the past, not the road to the future. And make no mistake: The battle for control of the mobile phone operating environment has broad implications. Wireless connectivity is one of the fastest growing segments of the industry, and tens of billions of dollars have been invested in the global wireless infrastructure. As phones and networks hit 3G (and faster) speeds, true wireless connectivity will become a reality; it's a question of when, not whether. It is too soon to tell if the mobile phone will be the main actor in this drama, but many companies are betting it will play an increasingly important role.