Remember back way back when, when there were several new OS platfoms coming and I said I thought Tizen was strongest bet? Well its been down hill ever since.
I've reported here that there were delays. Then carriers starrted to depart. Then the launch customer - prestigious NTT DoCoMo the largest operator/carrier of Japan and member of Tizen's Board announced they weren't going to launch the first Tizen devices. Then there were more delays and suddenly Samsung's first Tizen device wasn't even a smartphone, it was their watches. Then more carriers pulled out, and more and more delays. Then Tizen was supposed to have two actual smartphones launched this year (but not up to Galaxy flagship specs) and launch market was to be Russia. Then the smart watch evolution ended and shifts back to Android. Now we hear that Russia's phone launch is again delayed... And as I've been reporting on these news, each one has hurt Tizen's chances as I've written here on this blog and in my Tweets. At this point Tizen is nowhere near a threat to anybody in the OS wars, not even Blackberry's microscopic market share haha...
What is going on? We do know that operators/carreirs do want to have a third ecosystem alongside world-dominant Android and the luxury-end iOS. They already made it patently clear that Windows Phone will never be that third OS and Nokia actually owned that segment with Symbian-to-MeeGo-and-Meltemi but obviously then-CEO and worst CEO of all time Stephen Elop destroyed all that so he could pocket his 31 million dollar personal bonus after wrecking Nokia's total handset business (something the Financial Times said was a crime against Nokia shareholders similar to what Bernie Madoff did in Wall Street scams).
So yes, there is a desire to have a third ecosystem and very few options. Samsung inherited a lot of operator/carrier relationships to Tizen out of the past work by the MeeGo partnership of Nokia and Intel. Intel continues as Tizen partner as Nokia pulled out and Samsung stepped in to the project in 2011. Intel has found a lot of hardware vendors to join in what otherwise they might have viewed an OS by Nokia alone as too risky - an OS developed by a competitor - and meanwhile Nokia's side to the MeeGo partnership brought a lot of major carriers/operators starting with Nokia's long-standing partner NTT DoCoMo (who was famously spit in the face by Stephen Elop when he didn't even bother to tell them about the sudden switch from Symbian-MeeGo-Meltemi to Windows Phone. NTT DoCoMo was a Board member also with Symbian).
Tizen had a lot of major operators involved with it. They have been departing or lessening their interest. Why would that be? Samsung has thrown quite a lot of money at Tizen including creating those two smart watches earlier this year and creating close enough specs for two first smartphones to show their mock-ups and prototypes already. Thats a lot of R&D. And they have been recruiting developers to make Tizen apps with all sorts of incentives and contests and rewards. And yes at least technically there were a handful of name brand handset makers committed to launching Tizen smartphones too or other hardware like tablets or wearables. And several other interested parties from game makers to car manufacturers. And Tizen already powers some smart TVs at Samsung.
THIS IS WHAT I THINK
I don't know what is wrong. But the OS development with Intel as hardware partner and many carriers is of course a very sensitive issue of personalities and human issues. What did Telefonica want and was it in line with what NTT DoCoMo wanted or SK Telecom or Intel or Samsung. Were Samsung execs starting to make decisions that seemed like dictatorship in what was supposed to be a democrcy? Why did the carriers seem to revolt all about the same time towards the end of last year? Yes, maybe they saw the first prototype suggested Tizen smartphones and were not impressed. And/or maybe they saw what app offering was out there and how much Blackberry and Windows Phone were suffering and didn't want their names involved in similar failures. But come on. If Samsung wanted to make this happen, they can EASILY afford to simply pay to make it happen anyway. There is no 'retail boycott' against Samsung as we saw against Windows Phone or against Nokia. And with the carriers involved in the app store etc, then the gains and benefits out of Tizen should be far greater than anything they could expect out of Android or iOS for that matter. Why on earth not?
I do think its one of two things and possibly combination of both. I think its personalities and vanishing resources. We do know that developing a modern OS is very expensive and time-consuming. Obviously. And some companies like Apple and Google (and Microsoft) have spent countless billions in treasure and time to make their smartphone OS's reasonably modern and updated reasonably often and offering most reasonable features and needs (multitasking, alarm clocks, idle screens, MMS support, etc etc etc). So yeah. Maybe someone or some people at Samsung (possibly also Intel, who knows) upset some important people on the carrier/operator side. Maybe some promised resources didn't come or were removed. The project was probably already behind schedule and costlier than expected, and with the increasing pressures of the various competitors - like Blackberry's momentarily amazing BB 10 OS - would keep adding pressure to the project. Was Samsung (and possibly Intel) starting to limit budgets and resources?
The chance here is unique and amazingly big and hugely profitable. But it requires focus and commitment from the top. Tizen cannot be a side-line hobby project. That is what it seems to have been at Samsung especially. What is the madness of shifting from Android-based smart watches to Tizen, and now only mnoths later, to announce they are shifting back to Android? That is exactly the wrong message to send to anyone left in the Tizen alliance. That sets a very dangerous precedent that this will also happen with the first two Tizen smartphones. That next year Samsung announces, we'll go back to Android (at least they can't go back to bada haha).
WHY ONLY SAMSUNG
The reason only Samsung could do something 'certain' with a new OS is Samsung's scale. Samsung ship 1 million phones every day. They have nearly 20% market share of all phones, about 30% market share of smartphones. If Samsung decided over the next two years to shift all of their dumbphone production only, ignoring their current smartphones - to Tizen - that alone would produce a market share of 8% for Tizen worldwide. This alone, without any other handset vendors adding to the total. And make no mistake, Samsung is dedicated to shifting all of its remaining dumbphone production to smartphones just as how Sony has already done and what was the Motorola unit of Google until bought by Lenovo.
Bear in mind that just by that level of Tizen sales, Tizen would be as big as Windows Phone and Blackberry, combined - and that number TRIPLED !!! This all without cannibalizing one cent ouf of the Android based Galaxy sales yet... and of course it would be to Samsung's interest to have that ecoystem thrive and shift also part of Samsung's actual smartphone production also to Tizen. So if we say half of Samsung's current smartphone business would also be moved to Tizen, Samsung alone - before any other handset vendors are counted - would have something like 10% of the global handset market.
Why would this matter? I already told you last week about the enormous economic elodorado now unfolding in the center of digital convegence, driven by mobile. 7 Trillion dollars just at the center of the eye of that hurricane. The biggest economic opportunity in humankind's history. And Samsung more than most rivals in that race know what is coming, because Seoul is the nirvana of digital convergence, where digital convergence has proceeded the furthest of any city or country. Yes, more so even than Tokyo or Hong Kong or Singapore. And years ahead of San Francisco or London or Helsinki. So they know it in Gangnam.
And Samsung if anybody knows that hardware is always an industry that becomes commoditized and the early big margins shrink to razor-thin with mass market adoption and scale. Look at television sets or personal computers or MP3 players. They know that the profits in handsets aren't forever. But look at Microsoft, at Google, at IBM, where profits are huge in IT? On the software side. Again, Samsung know this better than most, having gone through so much of the commoditized IT businesses in the past.
WHAT IT WOULD TAKE
Clearly the carriers are not onboard with early Tizen prototypes and performance. This is now a wake-up time for Samsung top management. Do they intend to make Tizen the key to lasting long-term profits and the second largest ecosystem in mobile and digital - and invest in it properfly now (Google has lost billions in the software development R&D of Android, while not collecting any licencing fees to compensate for it. Why is it doing this? Obviously they know the long-run gains are vastly bigger now that they own the future of the OS wars and can replace Microsof'ts position in the past).
Look at Google. In 2006 then-CEO Eric Schmidt wrote the earth-shaking guest column to the Financial Times arguing that the future of the internet was ... mobile. And he was right of course (echoing themes Alan and I had been writing about in our book and this blog and obviously I've said in all of my books since 2002). Then Schmidt ran from meeting to meeting, internal and external, just repeating the mantra: 'mobile mobile mobile' He did that for years. Google was probably the first company outside of telecoms, that became a 'mobile first' company where any project was designed to be 'mobile first'. Now, 8 years later, we see Google reaping the rewards in anything from Android to Admob to Google Glass.
That is what it takes for Samsung. The top management starting with CEO Boo-Keun Yoon has to push Tizen to the front. This is the war that Samsung cannot afford to lose because it drives Samsung's profits in the decade of the 2020s. bada was the experiment. bada grew faster as a new OS than Apple's iPhone iOS did in the same period of time from launch, for the first two years. Samsung has already prototyped this strategy but now it is failing with Tizen. Unbelievable.
So then it means management change obviously. Tizen needs fresh leadership now. Whatever relationships have been damaged with NTT DoCoMo and the other carriers, now need Samsung CEO level personal involvement, to start to fix. The project needs serious public support and commitment from the CEO and the project leadership. And it needs fresh support from the carriers and the other handset makers (and from Intel).
If this means that Samsung has to subsidise some handset development costs at some rivals, that is a TINY price to pay for the long-term gains. If this means that the Tizen project incurs losses in 2014 and 2015, that is PEANUTS over what can be gained over time. But if the carriers decide to go with Firefox instead, then the game is lost. And there are a steady stream of pretty good handsets coming now from the Firefox family.
So Samsung. Go meet the big carriers. What does Telefonica want? What does Sprint want? What most of all does NTT DoCoMo want. Give it to them, whatever it is. You are the biggest tech company on the planet and second most profitable. You can easily afford the expenses of getting Tizen on its feet. You have to support it anyway on your TV sets and some handsets. The money is going to be invested anyway but you can do a half-hearted effort of it, that becomes certainly a long-term waste. Or you can now push to make it a reality.
If the OS itself is not amazing enough, or its user interface is not cool enough or the hardware of the first Tizen phones is not exciting enough - that is ok. Get someone in who knows how to fix that - like say Fjord the design superstars out of the UK whose DNA is all mobile and digital convergence and win all the awards always like say BBC's iPlayer. Yeah, they were bought by Accenture recently but most of the Fjord team is intact and operating as an independent unit with Accenture. Go hire them to come and fix the Tizen OS and help you design a couple of award-winning handsets while you are at it. They can't do miracles in minutes haha, but this time next year you should have real iPhone-killers to show and soon to sell if you get real competence in, who are given the tools to make Tizen the winner it was supposed to be. The DNA of Tizen is sound, Linux, mobile competence from Nokia and NTT DoCoMo on down, and HTML on top of that. Its predecessor, MeeGo was the only OS ever to regularly been called as good as the iPhone iOS in side-by-side user tests - something no other OS has ever achieved. The potential is here. But if Samsung the hardware company is struggling to get this done right - get in the right boss and right competence NOW to make it happen. Look what Apple just did with its iWatch - it hired TAG Heuer's top watchmaker genius to come redesign the misdirected Apple project and get it back on track. The time for Tizen is not done but it needs serious total management commitment NOW.
If you didn't know how big the digital convergence oppotunitity is - ie 10x bigger than automobiles or 20x bigger than computers or 50 times bigger than global advertising or 100 times bigger the total internet economy, read this: Grand Convergence.