FLOSS Beats Closed/Proprietary In a Competitive Environment

FLOSS has huge advantages for businesses working in a competitive environment where agility and speed of product development is very important:

  • the wheel does not re-inventing,
  • thousands of outside developers contribute at no extra cost, and
  • a much larger set of ideas goes into the pot producing better soup.

Nokia has found this out as Android smartphones have eaten Nokia’s lunch. You can read about it at Thinq.

Page 2 of that article contains a memo circulated in Nokia:
“In ordinary circumstances, the man would never consider plunging into icy waters. But these were not ordinary times – his platform was on fire. The man survived the fall and the waters. After he was rescued, he noted that a “burning platform” caused a radical change in his behaviour. We too, are standing on a “burning platform,” and we must decide how we are going to change our behaviour.

In about two years, Android created a platform that attracts application developers, service providers and hardware manufacturers. Android came in at the high-end, they are now winning the mid-range, and quickly they are going downstream to phones under €100. Google has become a gravitational force, drawing much of the industry’s innovation to its core. Let’s not forget about the low-end price range. In 2008, MediaTek supplied complete reference designs for phone chipsets, which enabled manufacturers in the Shenzhen region of China to produce phones at an unbelievable pace. By some accounts, this ecosystem now produces more than one third of the phones sold globally – taking share from us in emerging markets.

This means we’re going to have to decide how we either build, catalyse or join an ecosystem. This is one of the decisions we need to make. In the meantime, we’ve lost market share, we’ve lost mind share and we’ve lost time.”

Rumour has it that Nokia will switch either to Phoney 7 or Android. Are they crazy enough to jump from a burning platform to a sinking ship? I think they will go with Android so they can instantly offer what the competition offers and add their own expertise with phones. That will offer more than the competition and they will win share on brand recognition and features. The question remains what they will do about price. With Android they can provide a range of products all for similar cost of production but they can also sell some added value for higher prices.

For Nokia to go with Phoney 7 would be like a man who had just lost his house to go to Vegas to win back his money…

About Robert Pogson

I am a retired teacher in Canada. I taught in the subject areas where I have worked for almost forty years: maths, physics, chemistry and computers. I love hunting, fishing, picking berries and mushrooms, too.
This entry was posted in technology. Bookmark the permalink.

3 Responses to FLOSS Beats Closed/Proprietary In a Competitive Environment

  1. I wonder if this is a lesson for makers of PCs. Relying on M$ to drive the business is no advantage if everyone does that and “the tax” is a wedge between the customer and the maker. With a 50-50 split on licensing fees, the maker of the PC is essentially breaking even on selling the product while giving M$ a lot of free labour. This is not in the best interest of the maker. The makers of smartphones are laughing. They supply a great OS which the customers love and it costs the makers of smartphones nothing.

  2. Richard Chapman says:

    This is a very interesting situation. Nokia has a choice to win or lose. Microsoft’s Windows Phone 7 will lose no matter what. If Nokia chooses to go with WP7 they will also lose. That choice will also demonstrate that even a world class mobile phone company cannot breathe life into Microsoft’s product.

    If Nokia does choose to take on Microsoft’s product then at least other companies should take notice. Look what happens when a company’s top management is replaced by ex-Microsoft management. Decision making is cookie-cutter to favor Microsoft at the expense of the host (now drone) company.

  3. Ray says:

    You also have to realize that Nokia has it’s own special thing that sets it out from other competitors. It has to consider that before jumping onto the Droid/7 wagon.

Leave a Reply