Portable Penguins

“Linux, the original computer virus.”

That line used to be said of UNIX, but no single flavor of UNIX ever spread across so many platforms and onto so many handsets.  Those handsets, the oft predicted unified communications solution, are the new OS battleground.  In a relatively short time we have seen:

  • Google issue Android and, with partners Motorola and Verizon, shook Steve Jobs so bad he nearly busted a spleen (but I hear he can buy replacement parts easily enough)
  • Flush from that success, Motorola decides that owning a Linux distro might be a good long-term option and buys Azingo
  • Intel bought Wind River, the leader in embedded operating systems, and one who was grooming the embedded Linux market, including handsets, a chip target high on Intel’s priority list
  • HP, unhappy that Apple iPads beat them to the Slate market, and seemingly unhappy with Microsoft’s offerings for slab devices, buys Palm to own WebOS and thus bring down the cost of cranking-out hPads (and produce a device that does not require rebooting every other minute)
  • And, of course, RIM created and maintains the BlackBerry OS, which has proven to be so addictive that the FDA has considered regulating it

The interesting twin market dynamics are that every hardware manufacturer wants a slick mobile operating system, and nobody wants to be beholden to a software company.  Apple, HP and Nokia own theirs, Google and Motorola leveraged Open Source for their operating system (OS-OS?) and market leader Nokia did both, buying then outing Symbian.  Microsoft is found … well, it isn’t.  The factors that are driving this market change are:

Cost: Microsoft embedded OSs go for $3-16 per unit.  If you sell a million handsets in a year, that is real money and owning and OS or leveraging a ‘free’ operating system like Linux makes economic sanity.  Given that you can retail a smart phone for under $300, eliminating 5% of the cost of manufacture is a Good Thingâ„¢.

Control: For Apple, control is everything (they won’t even cede control of any part of the user experience to Adobe Flash).  Many Windows handset vendors felt they had little control over the user experience, which was largely bad anyway.  Buying an OS or influencing Linux development makes everything possible.

Innovation: If you do not have the ability to alter or extend the OS, then you have limited ability to extend the user experience — just ask anyone who waited an eternity to get copy/paste on an iPhone.  Having access to the OS source code means you can either mandate or influence core functionality.

The customer: People like what they know.  If you create a good daily user experience early in a product relationship, then the customer is more likely to stay with you in future purchases, especially if you have special lock-ins that make switching difficult. Owning or manipulating the OS makes this more likely.

Unclear is if the recent OS buying binge will soon abate.  Some of the alternate handset makers — Samsung, HTC, etc. — who have played the field might see the wall writing and hedge their bets by buying a mobile OS, or become specialists in one or more of the open varieties.  The real question is which strategy will win in the long term.

Don’t bet on Apple.  Walled gardens keep people out as well as in.

Don’t bet on Windows because their partners aren’t.

Don’t bet on WebOS because HP will not have the market breadth to make it a widely known and loved OS (and, as RTE, MPE and HP-UX have shown, operating systems are not HP’s strong suits).

Don’t bet on Motorola/Azingo because Moto is not a software company and lacks the creative energy to enhance Linux.

Place a side wager on Symbian because it is better than most people think and might be a dark horse.

Bet big on Android.  Google is driven, creative, knows how to lead and Linux has the power of an ecstatic developer community.  And being the original computer virus, it will handily port everywhere while stuff like Blackberry OS, iPhone OS and WebOS don’t.  Change often comes from the inspired or frustrated masses and Google can channel that into Android, as can their partners who have the skills and the motivation to make it happen.

UPDATE: A few hours after this blog was posted, a report hit our desk showing that Android OS is now selling faster that iPhone by seven market share points.  Double down?


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