Kate Bulkley, Media Analyst.

Profile of Colly Meyers CEO Symbian

By Kate Bulkley

The Independent

Nov 22, 2000

Colly Meyers has a problem. The founding CEO of Symbian has shaped a team of software developers into a company that has a good shot at being the operating system of choice for the nascent mobile Internet revolution. The problem is that Microsoft has set its eyes on the same prize and the Redmond, Washington-based software giant is lining up some heavy artillery against the small, London-based firm.

What's at stake is the evolving and potentially huge market for the next generation of wireless devices, ones that combine a mobile phone with Net-enabled computer functions. These so-called smart phones receive and send e-mails while you are on the move, let you shop on-line and allow real-time information like sports scores and weather updates --as well as changes in your calendar or updates to your address book-- to be piped directly to you wherever you are.

The battle between Symbian and Microsoft is over the sophisticated software that turns today's mobile phones into devices that look more like programmable computers capable of downloading software, games and even video from the Net. According to banker Merrill Lynch the global market for these devices could be worth $205 billion by 2005 and clearly represents the next wave of computing. The question for Microsoft is clear: can the software giant create the same software dominance in the wireless Net arena that it has in the PC world? With a big part of its future at stake, Microsoft is committing a lot of resources to make sure that it comes out on top. "The bulk of R&D (research and development) today is invested in wireless and enabling information on various wireless devices," says Adam Anger Microsoft's business manager for its mobile devices group. One concrete example is Microsoft's new, 300-person Mobility Solutions Centre near Stockholm opened in July to co-ordinate its mobile efforts with big handset makers like Ericsson and Nokia.

To his credit Meyers, the serious-minded head of Symbian, is holding his nerve against the Microsoft behemoth. It helps that the 46-year-old South African and Zimbabwe-raised Meyers is a trained software developer who has a deep and articulate understanding of what technology works best, yet his critics say that this strength has also become Symbian's biggest Achilles' heel. As Microsoft revs up its global resources from R&D to marketing to a 6,000-strong group of developers who write for Microsoft Windows software, the 720-person Symbian team looks out-manned and out-gunned. There is even speculation that Meyers should move over to make way for a more dynamic salesman at the top of Symbian. "Colly has done an excellent job of roping together a bunch of technology companies and getting them to work together," says William Fellows, a technology writer at information site 451.com. "The challenge now is to find someone to market it and evangelise Symbian." Meyers is not unaware of the size of the Microsoft threat, but he is quick to point out that Symbian's software is already licensed to the biggest names in the mobile business and that the company's shareholders also carry a great deal of their own clout.

Symbian was founded in early 1998 by a consortium led by UK handheld device company Psion, where Meyers had been working as a software engineer for 17 years, and mobile phone manufacturing giants Nokia, Ericsson and Motorola. A year later Matsushita, owner of Panasonic, joined as a shareholder. Symbian was created because the hand-held device makers were frustrated by Microsoft's unwillingness to design an efficient operating software for portables. "Microsoft's answer was Windows CE, which was only a scaled down version of Windows," recalls Peter Bodor, a spokesman for Ericsson. "Symbian's software called EPOC was developed specifically for portables with good user interfaces and good power use." Soon after Symbian was launched, Bill Gates called the consortium one of the "greatest threats" to Microsoft, signaling a shift in the company toward wooing the mobile manufacturers. Microsoft has been playing catch-up to develop a leaner version of its Windows CE software which consumes less power and uses less precious memory space.

Significantly, a prototype phone with Microsoft's new Stinger software was unveiled in London last month, sooner than most in the industry had expected. "The reaction was extremely positive," says Microsoft's Anger. "Most manufacturers were pleasantly surprised by the progress Microsoft has made." Sony, Benefon, Sagem and Samsung have all lined up releases of Stinger, but Symbian beat Microsoft to the punch with the release this month of Ericsson's R380, the first smart phone using Symbian's EPOC operating system. And more are on the way. Symbian has licensed its operating software to all its shareholders as well as to Sanyo, Sony and most recently Kenwood. Japan is going to be a very big early market for smart phones because it will roll out the world's first so-called 3G or third generation high-speed mobile phone networks next April. "This is a very important market for us and you should not infer that just because we haven't announced other names that we haven't been talking," says Meyers.

Symbian has also announced Pearl, an updated version of its EPOC software that is meant to rival Stinger, as well as a software platform called Quartz & Crystal that will better allow mobile networks and devices to work together. Products based on Pearl and the Quart & Crystal software will be commercially available next year. "Symbian is a bit like an iceberg," says Meyers. "You've only seen one-tenth of it at the moment. The other nine-tenths are coming with the delivery of the Quartz & Crystal platform."

But the pressure is on. The first phone-enabled PDA (personal digital assistant) device using Microsoft's Stinger is being manufactured by Sagem of France and will be on sale before the end of this year. If Stinger is successful, Microsoft can use it to sell its other wireless Internet software like it did with its Windows system for personal computers. "We're thinking about things not only from the device perspective but as an entire solution," says Microsoft's Anger. "The combination of what we provide for smart devices with our software for servers is a strong combination." Indeed, Symbian suffered a blow earlier this year when its high-profile head of marketing Juha Christensen defected to Microsoft because he reportedly felt that Symbian was too focused on the mobile phone market rather than on the "complete software solution" being promoted by Microsoft.

Staff attrition at Symbian has been high at about 18 percent. A public listing could help retain staff, but given the poor acceptance by the market of high-tech offerings, this is still a ways off. Meyers says Symbian is on track to break even on an operating basis in 2002 and he has put in place a new remuneration package to retain staff. He also defends Symbian's strategy saying that focusing on mobile phones makes a lot of sense given that this is the big growth area. "Since Psion began in 1985 they have sold about 4 million PDAs. Sharp has sold another 5 million and with Palm and the rest (of the manufacturers) we are talking about 22 million PDAs sold over the last 15 years. In the mobile phone market they sell 7 million units a week. Now look at our shareholders and our licensees to see our channel to market. We have the platform and the customers who can get that kind of volume to market. You have to ask what the others have in that context."

Symbian's high-powered shareholders are an advantage but loyalty only goes so deep. For example, Symbian shareholder Ericsson will use Microsoft's Mobile Explorer browser in a new handset model. Sony, a non-Symbian shareholder but a key manufacturer, is also playing both sides. This spring it agreed to use Microsoft's Mobile Explorer, which will be incorporated into Microsoft's Stinger, on its products, but a few weeks later the Japanese electronics giant said it would also license Symbian's Pearl software. Meyers says that the Microsoft product is only for Sony's standard phones, while it is Symbian's software that will be on Sony's advanced multimedia products. Sony could not be reached for comment, but the story illustrates the intensity of the fight and underlines the fact that in the end the manufacturers want to sell as many phones as possible and they will use whatever product gets them to their goal the fastest. "We are committed to Symbian but in the future if another device comes up that needs another operating system we'll look at it," says Ericsson's spokesman Peter Bodor. "We are reviewing all kinds of operating systems." And it's not just the equipment manufacturers who are interested in driving the market for advanced mobile devices.

Mobile operators like Vodafone are making huge investments in next generation phone licenses and networks. They need to be able to offer their customers the best mobile applications possible to attract them to their networks and to keep them as loyal, paying customers. These companies are starting to make demands on their hardware suppliers to make sure that the wireless devices they deliver have the right software capabilities, which tips the balance of power a bit and could give Microsoft, with its large suite of software designed for servers, an advantage. In fact Microsoft already has deals with BT, Vodafone and Telefonica to deploy its Mobile Information Server software, which allows secure access to email, for example. But Meyers believes Symbian's parentage and focus on software designed specifically for portable devices is a winning approach. "It's very much about driving a mass consumer market," says Meyers. "It's a very complex market and it's very big and it's going to need each player to do his part. What I believe as a philosophy is that in these big global markets you can't do everything. You can't control all of the different parts of the value chain. You have to focus on what you do to really deliver on the market. That's what we are doing. We're focused on producing just wireless devices for this new opportunity for all those great licensees of ours to get product to market. We're confident that that's the right approach to really grow the market."

As the mobile device becomes more of a Net-enabled computer one opportunitiy for Symbian is to work more closely with the leading PDA maker Palm, which today has its own operating system for its hand-held devices. But such a link-up could create a potentially sticky situation given that Palm is a fierce competitor to Psion, which is Symbian's largest shareholder with a 28% stake. Meyers also looks a bit caught in the middle: he is both an ex-Psion employee as well as half brother to Psion CEO David Potter.

Meyers says that these relationships do not drive Symbians' strategic decisions and that specifically they do not prohibit Symbian striking a deal with Palm. "We have talked to them and we have an open-minded view but Palm have issues as well," says Meyers somewhat cryptically. At the moment Symbian looks to have a slight advantage in the race to capitalise on the growth of connected mobile devices. But the UK company needs its licensees to start churning out devices with Symbian's operating system, or Microsoft's late start getting its own software up and running and accepted by manufacturers and operators will soon be forgotten. "The problem for Symbian is that Microsoft is pervasive," says Gavin Patterson, editor of newsletter 3G Mobile. "People know it and are familiar with it and so that is Symbian's biggest threat."

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