Cheetah
Deity
This is my translation of an article written for Dagens IT and thus Dagens Næringsliv - the Norwegian equivalent of Wall Street Journal:
An unbelievable story
ANALYSIS: Four years ago everyone were laughing of the Americans - now they draw in everything.
The comeback is almost unbelievable. USA was the country the entire mobile industry was laughing of. The world foremost technological power - who had barely started using SMS a few years ago. They had the mobile phone producer Motorola, but other than that it was the Nordic and East Asian companies and markets who were the world leaders - with the biggest producers and the most advanced mobile phones, services and users.
But on Friday Nokia CEO Stephen Elop proudly declared that the world of mobile phones now is a race with three competing horses: Apple, Google and Microsoft. USA, USA and USA.
Changed the rules of the game
The giant Nokia capitulated on Friday - they abandon their own mobile system Symbian. The process is perhaps best described with Elop's own words: Unbelievable!
Two years ago Nokia dominated the mobile world with 40% market share, but in June 2008 Apple opened its App Store, and the process that would change the entire dynamic began.
- The game has evolved from a battle between mobile phones to a war between ecosystems, says Elop, when explaining Nokia's capitulation.
Nokia suddenly competed not only with Apple on making good mobile phones - they also had to fight their mercenary army of developers, who have made several hundreds of thousands of apps which make the iPhone even more tempting. Apple has gained an ecosystem that makes them much more powerful than they can be on their own.
At the same time Google entered the competition and created Android - an alternative ecosystem for all the other mobile producers. They got a huge response - and merely two years after the launch they have now become the world's most sold smart phone system. They have created the biggest system, without ever having produced a single mobile phone themselves.
Until recently it was Nokia's Symbian who was the biggest, but now it is going to be abandoned, and Nokia is betting everything on the Windows Phone ecosystem. If this maneuver succeeds American companies will control the three dominating ecosystems for mobile software. They will barely produce any phones themselves, but it will still be them who will set the premises for the continuing developments.
Has never been any good
Why did this happen? Trolltech entrepreneur Eirik Chambe-Eng probably had part of the answer, when he (before he was bought by Nokia) pointed out that mobile producers were never any good at making software. In this perspective it is not surprising that they get beaten soundly by software specialists from the computer world.
They last couple of years the mobile phones have become powerful, small computers, and they accomplish many of the same tasks - and similarily the hardware, which the mobile producers excel at, has moved out of the spotlight. The majority of today's phones already has everything of GPS, gyro sensors, cameras and polyphonic ring tones. Now it is the software that really differentiates, and therefore the mobile producers are drawn towards Google and Microsoft. The mobile phone has become like a PC - not the other way around.
Thinks bigger
Nokia never managed to make a functioning ecosystem around Symbian. They tried, but few app-developers were tempted to join in. Symbian was seen as old fashioned, and the market share fell.
The fall could partly be blamed on the fact that they weren't good enough at making user friendly software, but there also seems to be something special with American companies. The Swedish broadband visionary Jonas Birgersson pointed out that American companies thinks much more strategically than Nordic companies. He might be correct about that.
For it isn't the first time that American companies do this. If one looks at the software industry in general, almost all the large ecosystems, with the exception of German SAP, is built around American companies. The Americans have also done this within other industries, not least the entertainment industry.
The American companies seems to excel completely at creating a gravitational field around them. Like large suns they have a multitude of planets and moons orbiting them. This is the companies' ecosystems, who make a living out of selling products built on top of what the Americans create. They contribute income and creativity, and both strengthens the system's core.
The X-factor
One explanation for this pattern might be a large and advanced home market, but for mobiles this explanation is not enough. American mobile users were definitely not the world's most advanced, and the competitors had much larger volumes. Even so, American companies have managed to maneuver themselves in as premise givers, in a market where the two largest American mobile producers on total delivers less than 6 percent of the world's mobile phones.
Nokia CEO Elop describes Google as a "black hole" which pulls towards it everything of innovation within the mobile phone universe. Within such an imagery it must be clear that the USA must be the largest black hole in the world - a description Elop underlines as positive.
- We dream bigger, said Microsoft CEO Steve Ballmer, during a presentation of Nokia's capitulation.
Perhaps the explanation is that simple?
