Samsung buys Symbian stake, dares Microsoft

CANNES, France: Samsung, which 12 months ago was not even a Symbian licensee and appeared firmly in the emerging Microsoft camp, said it feared a rerun of the history of the personal computer industry if Microsoft and its chip ally Intel were left unchallenged.

"We have good reason to be concerned. They (Microsoft and Intel) took all the value and left hardware makers as clone producers. We don't want a repeat of that situation," San-Jing Park, head of mobile handsets at Samsung, told Reuters on the sidelines of 3GSM, the world's largest wireless trade show here.

The South Korean company, the world's fastest growing handset maker with a global market share of around 10 percent, would own Symbian jointly with its top five rivals -- Nokia of Finland, Motorola of the United States, Siemens of Germany and Sony Ericsson.

"The terminal manufacturers have come together to promote one operating system," he said. "Symbian has greater growth potential (than Microsoft), particularly because it's an open platform."

Symbian and Microsoft are battling for the emerging market of so-called smart phones. They both aspire to deliver the basic operating software and set the software standard for the tiny devices. Two out every five phones sold in 2005 could be smartphones, said Microsoft, which targets the cell phone market now that computer sales are stagnating.

Samsung will also launch devices based on Microsoft software, mainly pushed by its U.S. corporate customers and operators, who have their business applications running on Microsoft software and want their employees in the field to run the same programmes on their handheld devices.

Samsung showed a new handheld computer phone based on Microsoft software here in Cannes. Meanwhile Microsoft showed new devices using its software made by Asian contract manufacturers, which will build to order for operators.

Park said the decision to invest in Symbian was partly based on Symbian's promise to help develop software that ensures all Symbian devices will work with corporate applications. It is backed by Nokia, Ericsson and software maker Oracle to achieve this.

The first Symbian phone will come in the fourth quarter of this year, and Park said many others will follow. They will initially be for the GSM mobile networks in Europe and parts of Asia, but later on also for the smaller competing networks based on CDMA technology in the Americas and Asia.

Symbian Chief Executive David Levin underlined that Samsung was the world's third largest handset maker but that it had an even bigger market share in the segment for expensive handsets with colour screens, cameras and musical ringtones, for which new applications will be pioneered that make phones 'smart', such as calendars, games, email or corporate software.

Samsung's five percent will dilute the stakes of the other Symbian shareholders, who include Britain's Psion and telecom equipment maker Ericsson. Symbian has invested a total of 300 million pounds in its mobile software, CEO Levin told Reuters.

© Reuters