Nokia buys new OS for featurephone push
As rumors of Microsoft acquisition swirl, Finnish giant takes Smarterphone to boost its presence in non-smartphone world
Published: 9 January, 2012
The new year's favorite recycled rumor is that Microsoft will buy Nokia this year, and indeed there are reports that the companies' respective CEOs, Steve Ballmer and Stephen Elop, will meet at this week's Consumer Electronics Show to seal the deal. There are all kinds of reasons why Microsoft, which has Nokia in its pocket anyway, should not burden itself with a hardware business, but it is possible that, in the wake of Google's Motorola Mobility deal, it is eyeing an intergrated hardware/software platform and a tame provider for the ARM/Windows combinations.
In the meantime, Nokia has made a more concrete acquisition, which reveals the continuing importance of its strengths in featurephones (uninteresting to Microsoft or the media, but vital to the Finnish giant's market share, cashflow and global brand recognition). Nokia has bought mobile OS developer, Smarterphone of Norway, for an undisclosed amount. The smaller firm was privately held and backed by Ferd Capital.
This brings Nokia a featurephone OS which boasts a smartphone-like user experience on low cost hardware, as well as a high level of flexibility, allowing the UE to be customized by different operators or partners. The challenge of delivering 'smart' experiences, and driving data service revenue, on low end phones and networks, is an important one in the emerging markets, where featurephones will remain the biggest part of the base for many years. The issue has been addressed by software firms like Myriad, Opera and others, and by hardware suppliers like MediaTek, which offers reference designs for low end handsets with integrated web services.
Smarterphone is a small player - Ferd Capital has invested a total of €6.5m over its four-year life - but comes with an interesting pedigree, and capabilities which could achieve significant reach on the back of Nokia's Series 40 platform, which - with Java and some Linux variants - dominates the featurephone OS segment. The Norwegian firm was founded by Egil Kvaleberg, also its chief software architect and well known in this field, while other financial backers include Haavard Nord, the founder of Trolltech, one of the most influential of the cross-platform mobile software frameworks, and also acquired by Nokia.
The latest purchase highlights the continuing innovation going into Nokia's low end offering, whose latest quartet of devices, the Asha family, almost matched the Lumia WP7 smartphones at its most recent major launch event. In September, the Finnish giant was reported to be developing a new low end software platform, Meltemi, which could now incorporate Smarterphone. Meltemi will major on having a simple user interface, which could be that of Smarterphone, and will work with very low end hardware and connections, but aims to go well beyond S40 in functionality.
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