Samsung Responds to Google buying Motorola Mobility

Financial Times reported that Samsung is going to work with Intel to extend proprietary Bada operating system to run on Intel chips. Intel has long wanted to compete in the mobile chips space finding itself behind competition. Intel partnership with Nokia on Meego operating system is doomed and new partnership with Samsung, one of the biggest phone makers, makes sense for Intel.

Samsung, on the other hand, privately (along with HTC) expressed concerns about Google buying Motorola Mobility and its further dependency on Android. Google becoming phone maker will directly compete with OEMs who produce phones with Android OS. Also, Android OS is no longer free (patents royalties) and not as opened. Samsung is trying to advance further own mobile operating system (Bada) to reduce the risk of depending too much on Android. There are also Samsung phones with Windows Phone operating system that will reduce dependency on Android further. Today Bada and Windows Phone have about the same global market share: 2%

New Entrants into Mobile Operating Systems Space

This is interesting time in dynamic mobile space. Old incumbent platforms are dying (Blackberry, Symbian, webOS) because the market cannot sustain the fragmentation and but new platforms are emerging.

• August 1, I wrote blog article that Alibaba is releasing own mobile operating system. September 10 the company announced localization in Traditional Chinese and English
• End of August I wrote another article that Korean government endorsed its OEMs to create own mobile operating system, considering Samsung already had own semi-successful OS named BADA
• In a recent interview with The Economic Observer, HTC co-founder and chairwoman Cher Wang said that it is considering purchase of own operating system.

Why all major phone makers suddenly considering building or buying own operating system? Perhaps because free Android is no longer free. Microsoft is charging between $5 and $15 per phone patent royalties, some of which exceed licence fees for Windows Phone 7.

New mobile platform entrant should be aware about the three major problems:

• Gaining market share. Ask yourself, why would you buy something other than iPhone or Android phone? I cannot come up with one reason.
• Developers interest. There are not enough developers to cover half a dozen mobile operating systems and make money the same time. Developers make money on the scale of downloads and the scale decreases with the increase of the platforms. Number and quality of apps are the key to growing market share.
• Monetization. will the platform make money? If not, I am not sure incremental cost of building and supporting own operating system is lower than licensing Windows Phone or paying royalties for Android.

Korean gov't to ask Samsung and LG to develop mobile OS

Google acquiring Motorola sends shiver to Android OEMs. Even before the acquisition when Google making own phone (Nexus One) had Android OEMs concerned that Google would be directly competing with them. Now that threat is even bigger. FT.com reports that Korean government is asking Samsung and LG to develop own operating system to reduce dependency one Android. That would be difficult because of Android attractiveness (50% global market share + free license). Building own Mobile OS when others are dying (Palm webOS, BlackBerry, Symbian) and Chinese Alibaba also in process developing own mobile OS, as I reported earlier.
My recommendation for Samsung and LG to reduce dependency on Android is be to diversify with Windows Phone.

Sales of Microsoft Windows Phone beat by Samsung Bada

Honestly, before today I did not know Samsung had own smartphone operating system. Turns out sales of Windows Phone are lower than a no-name OS. Seattle Times article reported that sales of the phones with the Windows Phone 7 OS are dropping.

For Microsoft, much anticipated Mango update cannot come soon enough as well as the scale with Nokia's partnership