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April 20, 2004

Telecoms: mobile giants deny handset power play

Six of the world's largest mobile operators have denied speculation that they are in the process of forming a cartel to put pressure on handset and software vendors to meet their requirements. But such a body would clearly have an immense impact on the future direction of the industry.

By CBR Staff Writer

Vodafone, mmO2, Orange, Telefonica Moviles, TIM, T-Mobile and Smart are teaming up.

Even if they are not planning to increase pressure on vendors, the formation of a group including Vodafone [VOD.L] and mmO2 [OOM.L] in addition to existing allies Orange [ORA.PA], Telefonica Moviles [TEM.MC], Telecom Italia Mobile [TIM.MI], and T-Mobile, could have profound effects on the mobile landscape.

The group, which also includes Philippines-based operator Smart, was reported to have picked Java-based mobile OS vendor SavaJe Technologies as its preferred supplier of OS software. However, both the operators and SavaJe denied that any such plans had been made.

News of the alliance was leaked to the UK’s Financial Times, which interpreted the plans as an effort by the operators to destabilize the grip on their customers that handset vendors, particularly Nokia [NOK.HE], and mobile operating system vendors such as Symbian, Microsoft [MSFT] and PalmSource [PSRC] currently enjoy, or are perceived to enjoy.

A grouping of major operators around a set of well-defined handset specifications could tip this balance. It could also provide considerable economies of scale when purchasing handsets that could be passed on to end users. However, the operators involved were quick to deny any underhand motives for their plans, which do not appear to be advanced.

Many in the industry see the SavaJe OS as a potential rival to established mobile OSs. Where these have been designed principally with C and C++ developers in mind (albeit usually with a Java runtime available), SavaJe OS has been designed from the ground up to make use of Java and therefore to appeal to the 2.8 million Java developers worldwide.

Java has rapidly become the most widely deployed application runtime for mobile handsets in its Java 2 Micro Edition, Mobile Information Device Profile form. SavaJe provides a native, multi-tasking environment for both these and applications built using the J2ME Personal Basis Profile, greatly improving performance over today’s handsets.

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SavaJe’s links to the new operator grouping are not entirely unexpected: both Orange’s and Vodafone’s venture capital arms are investors in the company.

This article is based on material originally published by ComputerWire

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