Analysis: Nokia bets on Linux and Symbian

Nokia is extending its knowledge base in the free Linux operating system as the mobile software battle with Google hots up.

The world's leading handset manufacturer has made a big bet on Symbian software, offering $410 million (221 million) to buy out other shareholders in the consortium and committing to opening the software up for free use when the deal is approved.

Nokia says Symbian plays a central role in its software strategy, but analysts say the role of Linux in the company's Nokia phones is also set to increase, reflecting a mindset shift for a company that has long shunned using software from multiple vendors.

"It is unlikely Nokia would be prepared to open-source a strategically important platform if it did not have another one in development," said Ben Wood, research director at CCS Insight.

"We believe Nokia needs a more powerful mobile software platform to compete with the iPhone and similar products," Wood said, pointing to Linux as the likely candidate.

Symbian, which has already some 250 million users, is the leading smartphone operating system, controlling more than half of the market. But the competition has heated up over last year with new players looking for a slice of a market that gives access to billions of users.

"Linux will (serve) for the flagship phones, Symbian for mass-market," said eQ analyst Jari Honko.

Smaller handset vendors like Samsung and Motorola have used several operating systems in their phones, while Nokia has kept its focus on Symbian.

However, the Finnish firm has for years dabbled with Linux, using it in "internet tablets" - sleek phone-like devices used to access the Web that have lacked mass-market appeal due to their lack of a cellular radio.

Nokia last week told delegates at a technology conference the next version of its Linux maemo software will give devices access to 3G networks, while it also upgraded its membership in the Linux Foundation to gold level.

"Nokia's vision is to bring open source and Linux to the consumer mainstream," Ari Jaaksi, head of Nokia's Linux software development, said in his blog.

Just like Google, Nokia hopes opening the software code to developers for free usage would boost its takeup among industry and developers who are often shy of using one-firm dominated platforms.

"Look at what we have done with Symbian: that's going towards open and what we have already done with maemo - it's very open. You see where we are putting our bets," Nokia's chief technology officer Bob Iannucci told Reuters.

Computer operating system Linux has had so far little success on cellphones, but it has started to gain traction with launch of LiMo Foundation, a wide industry grouping. Google has also built its Android platform using Linux.

Linux is the most popular type of open-source operating system -- one available to the public to be used, revised and shared -- meaning it has a large developer community that could result in more attractive programmes and lower costs for companies like Nokia.

Nokia's chief financial officer Rick Simonson in May called Linux's role "terribly important" at an investor conference, saying Nokia had been developing the next generation of Linux-based products, which are starting to come to the market.