Many thanks to C. C. for this interesting post: :)
The Ovum View: Future wireless devices - why Microsoft won't clean up
Jessica Figueras, analyst at Ovum, asks whether today's handset giants end up being tomorrow's box-shifters?
There's an interesting idea, currently doing the rounds, which says that soon the mobile handset industry will become like the PC industry of today: a horizontal industry based on standard platforms, where vendors specialise in particular tasks rather than trying to do everything themselves.
More cynically, it could become an industry where manufacturers assemble others' technologies for razor-thin profits and the platform owners make all the money.
Perhaps unsurprisingly, this idea is equated with a wholesale takeover of the handset market by Microsoft - in an extension to its PC platform ownership. Certainly the handset market will become more horizontal but there are many reasons why history will not repeat itself in Microsoft's favour.
Two reasons why the early PC industry went horizontal were a pressing need for interoperability and to cut costs. The days when PC manufacturers could design and build most of their own hardware and software components certainly led to some technically superior, resource-efficient platforms but this model was also very expensive.
High build-costs and low volumes meant high prices. There was also little or no interoperability between all of those technically superior platforms, which critically restricted growth in the embryonic PC software market and severely limited what PCs could do for end users.
So in the early PC market, the process of horizontalisation and platform standardisation became inextricably linked. As PC manufacturers opted to dump their own platforms in favour of licensing them from third parties, horizontalisation helped to cut costs and standardisation helped solve the interoperability problem. Some resource efficiency and robustness was sacrificed but as memory became cheaper and microprocessors faster and cheaper, this became increasingly irrelevant.
Unfortunately for the manufacturers, some of these third parties - particularly Microsoft - ended up owning the sweet spots of the PC value chain. Manufacturers found it increasingly hard to differentiate and add value because all of the value was in the features provided by the platform. But as prices continued to fall and Windows provided more and more features, consumers really didn't care - they were all too busy playing Doom.
News source: silicon.com
View: Mobile handset wars: Nokia will beat Microsoft, says Ovum Worth checking for the rest of the article IMHO