Operators look to Firefox to help them develop more profitable smartphone strategies

SPAIN: Seventeen mobile operators have committed to launch devices using Mozilla’s Firefox OS in an attempt to generate more revenues from mobile services and help them reduce the handset costs they incur from subsidising high-end smartphones.

While the Apple and Android eco-systems have created services that have proven incredibly popular with mobile users in developed markets, there remain many, especially in developing markets, for who it’s not profitable to subsidise a high-end smartphone. It is these users that represent the biggest potential market for devices running Mozilla’s Firefox OS, and initial plans announced at MWC today suggest developing markets will in fact be the main focus, initially at least.

Operators signed-up for Firefox OS devices will also be hoping they can make in-roads into the applications and services market they are currently locked-out of by Apple and Google, with its Android OS. However, operators’ track record of developing services and applications means there is little precedent to suggest the open HTML5 technology underpinning Firefox will by itself help them succeed where they have floundered in the past.

Still, the commitment to Firefox from major operating groups - América Móvil, China Unicom, Deutsche Telekom, Etisalat, Hutchison Three Group, KDDI, KT, MegaFon, Qtel, SingTel, Smart, Sprint, Telecom Italia Group, Telefónica, Telenor, TMN and VimpelCom – means that devices running the operating system stand a good chance of getting into the hands of people who don’t already own a smartphone, and who it is not profitable to target at the moment. As such, Firefox OS represents a good opportunity for operators to cost-effectively increase smartphone penetration.

To make a success of Firefox OS operators will need to do a lot of work to convince the market about the benefits and capabilities of Firefox-based devices. They will also need to work closely with the manufacturers to make sure the devices are compelling enough - from appearance and usage perspectives - to help increase smartphone penetration among their target markets.

Meanwhile, for vendors, Firefox OS devices could help them to take on vendors, especially Nokia with its Asha range, in markets where smartphone penetration has yet to take off. Alcatel, LG and ZTE have signed up to build the first Firefox OS devices, with Huawei to join later in the year.