Nokia to buy Symbian, but still no changes in Mobility

Nokia, which had long owned a substantial portion of Symbian, the company behind the popular proprietary mobile operating system of the same name, announced Tuesday that it would be buying the rest of the company, 52% for approximately $410 million. In addition to purchasing Symbian, Nokia will place the code in the hands of a new vendor-neutral organization: The Symbian Foundation.

Symbian is already the leading open platform for mobile devices. Through this acquisition and the establishment of the Symbian Foundation, it will clearly be the most attractive platform for mobile innovation. Hopefully, this will drive the development of new and forceful Web-enabled applications to delight a new generation of consumers. According to sources at Nokia, code will be released to the public for the first time in either the last quarter of 2008 or the first quarter of 2009. All of Symbian OS and its development tools will be made available by 2010. In short, Symbian and its major interfaces are well on their way to becoming a completely open source operating system and development platform. So far, good news.

In my opinion, all Nokia is doing by acquiring Symbian is to make a defensive play, because even as Symbian has grown into the dominant supplier of smartphone operating systems, it is still being challenged by several new strong players. For instance, Google challenged the commercial/business model, stating that its Android platform has reduced the cost of software to almost zero. Also, the LiMo Foundation, a consortium working on a Linux-based operating system for mobile devices, has strong support from network operators, which have been attracted by its governance model. And, of course, no one can ignore Apple and the iPhone as the company has raised the bar from a technical perspective and consumer’s attraction. But, where is Microsoft in this chess game? I just don’t think they might be able to affect the mobile device market. Certainly, Microsoft may go after BlackBerry powerhouse Research In Motion, but at this point, it’s more likely to see RIM/Google or RIM/Nokia, especially with Microsoft still trying to deal with Yahoo.

In summary, this acquisition will solidify Nokia's presence on the mobile market despite anything that Google, LiMo, or Apple can do. However, let’s not forget that it wasn't so long ago that Apple had no mobile phone market share, and betting against Google or Linux has not been a winning proposition in any market lately. More to come for sure…

Is Yahoo really changing?

At first, the initiatives Yahoo Inc. announced this past week, including new email product offerings and mobile deals in Asia, paint the company as a Web giant bravely regrouping for future battles. But rebel shareholders looking for a proxy battle, top executives heading for the exits and a reported major reorganization may only create even more trouble in an already sinking ship.

Right now, the company has an air of confusion about all of this. First, it's not surprising that Yahoo is reorganizing to try to accelerate growth. However, if the growth doesn't happen, the reorganization won't matter. A reshuffling of product organization could be made public in coming days, with the company centralizing several product groups, including its mail, search and home-page units. But, be careful with reorganizations since sometimes companies focus on looking busy instead of actually working on the company look better.

Secondly, Yahoo pointed to recent acquisitions such as RightMedia and Maven Networks, the expansion of its newspaper consortium and its new search outsourcing deal with Google Inc.

Thirdly, the expansion of email domains it currently offers. Yahoo says its user base of 260 million worldwide can start fresh with an address of their choosing by setting up an account that has ymail.com or rocketmail.com domains as their new email identity. Also, the company has signed deals to be the preferred search service with five more mobile-telecommunications companies in Asia, thus totaling 23 such relationships, increasing its share of the market for mobile-search queries. The focus on e-mail and mobility makes sense because these have traditionally been among Yahoo strengths.

Shareholders do not look happy either. Especially, the public attacks from billionaire investor Carl Icahn, who has repeatedly accused the board of stopping merger talks with Microsoft, and has pressured to replace CEO Jerry Yang if he wins in the upcoming board elections. Further, some senior executives have announced that they are leaving, including Jeff Weiner, executive vice president of the company's network division and Flickr founders Caterina Fake and Stewart Butterfield.

Even before the Microsoft bid went public last February, the company's reputation had been taking a beating for some years. Yahoo has struggled over the troubled introduction of Panama, the delayed technology meant to help Yahoo compete head-to-head with Google in search. To complicate things even more, Microsoft is actively recruiting in Sunnyvale and Yahoo's prestige as a Silicon Valley pioneer has been diminished as a result of recent struggles to regain a competitive edge.

Internet traffic to increase for online video

Cisco Systems Inc. is projecting that traffic on the world’s networks will jump 46% a year from 2007 to 2012. In 2012, Cisco claims Internet video traffic will be a stunning 400x carried on the U.S. Internet backbone in 2000. Video-on-demand, IP-TV, P2P and Internet video will account for 90% of all consumer IP traffic in 2012.

The networking-equipment maker, as part of a study called the Cisco Visual Networking Index, predicts that Internet video, which accounted for 5% of data traffic in 2005, will represent 30% of total data transfers by the end of this year. That will swell to 50% by 2012. Behind the trend is the surging popularity of Web sites such as Google Inc.'s YouTube, where users go to watch and share videos. Video already accounts for more traffic than the entire Internet generated in 2000, according to the study.

Cisco developed the study to help communications carriers make such plans. In recent years, the rapid growth of traffic has worried some Internet providers, which fear that the torrent of data could block their networks. Cisco prepared the study by collecting data from phone and cable customers as well as market researchers and internal experts. Web-based video is projected to overtake file-sharing as a percentage of Internet traffic in two years.

The study also found that Internet traffic is growing fastest in Latin America, followed by Western Europe and the Asia-Pacific region. The upswing in Internet penetration and the increasing number of universities and businesses with high-speed Internet connections will result in Latin America having the highest growth rate through 2012, according to the report.




Cisco Visual Networking Index