21. A new world of openness
Trend extrapolation can be misleading. For example, consider the following sequence of “million unit milestone months” – the dates at which sales of Symbian phones first reached an integer multiple of a million units in a single month.
- 1 million: December 2003
- 2 million: December 2004
- 3 million: June 2005
- 4 million: February 2006
- 5 million: October 2006
- 6 million: April 2007
- 7 million: July 2007
- 8 million: November 2007.
Looking at this trend, we seemed well on track towards “10-10-10” target that had been announced by the Symbian Leadership Team at the 2007 company Kick Off in January that year:
Before 2010 we want to be shipping 10 million Symbian devices per month
If we do that, we will be in 1 in 10 mobile phones shipping across the planet.
That target had struck some of us as modest when first announced. As a fan of having a “BHAG” – a “Big, Hairy, Audacious Goal” – I had suggested “40-40-12” instead: Symbian phone sales could reach 40% of all mobile phones, upwards of 40 million units a month, by 2012. But “10-10-10” had a cleaner ring to it, and made fewer assumptions about things that were likely to be outside of our control. So we stuck with the simpler target.
But in the first half of 2008, sales slowed. Sales in 2008 generally were no higher than those in the corresponding month one year earlier, and sometimes even dipped to around the level of two years earlier, 2006. The trend had become unstuck.
We could see three factors at work:
- The iPhone was starting to take a notable market share
- New flagship Nokia projects continued to reach the market later than expected, and had mixed reviews on their release
- The announcement of Android led more of the market into a “wait and see” mode.
It wasn’t just the decline of sales volumes that concerned us. We worried about:
- The fact that news and media discussions about smartphones often paid much more attention to the iPhone and Android than to Symbian
- The especially poor market performance of Symbian phones in North America: Symbian’s paltry presence in North America provided a fertile ground for the new seeds of excitement about iPhone and Android
- The loss of high-end sales (sales of expensive phones) – one area where the iPhone was proving successful
- The risk of losing some of our existing licensees to Android.
Ironically, it was conceivable that we might even achieve the 10-10-10 target, but lose the larger battle for industry mindshare; Symbian would become yesterday’s mobile operating system, used only in legacy projects.
The alternative view to this despondent forecast was that industry excitement about the newcomer mobile operating systems would be a temporary phenomenon. In this alternative, “steady as she goes” view, fundamentals would win out. Nokia’s well-honed expertise in telephony, in supply chain management, in robust hardware, and in creating huge numbers of variants, would have more lasting significance than cute changes in the user interface. The rich portfolio of efficient software in Symbian OS and S60 would enable licensees to continue differentiating, and would win back market support after the end of the iPhone honeymoon period.
This “steady as she goes” attitude assumed that the smartphone market would continue to follow the same core parameters as before – parameters which had generally served Symbian (and our licensees) well:
- Telephony was the most important application
- Phone manufacturers should prioritise meeting the requests of network operators
- Third party applications were a nice “extra”, but didn’t make any fundamental difference
- Most innovation in smartphones came from within the mobile industry, rather than from Silicon Valley
- The US market was a laggard in the adoption of smartphone technology; it was better to invest in Japan, China, or even India, than in the US.
In this viewpoint, Symbian should continue to execute broadly the same as before – admittedly with lots of scope for improving working relations with the software teams inside Nokia.
But the counter viewpoint was that the smartphone universe had fundamentally changed:
- The Internet (and particularly the web browser) was now the most important application
- Phone manufacturers should prioritise meeting the requests of Silicon Valley entrepreneurs
- Third party applications – and, more generally, openness to external innovators – could bring fundamental new value
- The US market would dramatically influence the way new smartphone technology was adopted around the world.
In this counter view, the New World of North America would herald in a new world of openness and accelerated innovation in smartphones.
Struggles in North America
In one way, Symbian had plenty of evidence about the importance of North America. I had shared the following note on the company’s “Symbian News” broadcast system as far back as January 2003:
As the worldwide Symbian business ecosystem has been gathering momentum during 2002, the importance of our American-based partners has become increasingly clear to us all. The US and Canada host a number of critical clusters of companies who are very significant players in the IT and wireless industries. For example, there are major collections of key actual and potential partners of ours in Texas (e.g. in Austin and Dallas), in Ontario/Waterloo in Canada, around Atlanta Georgia, around San Diego in Southern California, around Seattle and Vancouver, around New York and New England, around RTP in North Carolina, and not forgetting Silicon Valley. At the latest count, around 45% of Symbian’s signed Platinum Partners are headquartered in North America.
These platinum partners included tools companies, middleware companies, semiconductor vendors, as well as apps developers who needed more information about Symbian programming interfaces. But this interest failed to transform into sales of Symbian-powered devices in the USA itself. The US-based platinum partners sold their solutions, instead, into overseas projects. Even Motorola – a US-based company – considered Symbian just for use in non-US markets.
Four reasons stood out for this lack of Symbian sales in the USA:
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