Perhaps hoping for a modern remake of David’s victory over Goliath, Opera Software of Norway has taken on none other than mighty Microsoft Corporation as it attempts to get a hold on the emerging mobile phone Internet browser market.
At first glance, it doesn’t look like a very fair fight. As Microsoft prepares to post 35.6 billion dollars (28.9 billion euros) in revenues for 2003, Opera Software scraped by with about 0.03 percent of that last year, compiling a mere 11.3 million dollars (9 million euros).
But being small and nimble could in fact be to the Norwegian software company’s advantage.
While Microsoft seems to have its fingers in virtually every segment of the computer and internet markets, Opera, with only 140 employees, quickly took aim at a very narrow niche market: internet browsers for cell phones. And in that area, it has taken an extraordinary lead.
“We realized we were not going to beat Microsoft in the desktop segment,” Christian Jebsen, Opera Software’s Chief Financial Officer, told AFP.
“So we thought of the other markets we could address and we went for … mobile phones,” he added.
That doesn’t mean that the company, which was founded in 1996, doesn’t also make a pretty penny off the personal computer market.
Eight million Internet users have turned their nose up at Internet Explorer (Microsoft) and Netscape (AOL) and have instead chosen Opera’s downloadable Internet browser, which it claims is compatible with vertually every operating system out there.
Opera, however, basically considers its desktop software a laboratory experiment paving the way for its true passion: a cell phone internet browser.
In that area, the small Norwegian company has so far made amazing headway.
Some of the biggest mobile phone players, including Nokia, Sony Ericsson, Motorola, and Symbian, have already agreed to allow Opera to equip some of their phones with its browser.
“We are not battling head to head with Microsoft. We hang on the back of our customers who battle against Microsoft,” Jebsen said. “If Microsoft people were to crush us, that means that they would also have to crush Nokia or Motorola.”
His confidence may soon be put to the test. While Microsoft has yet to aggressively go after the mobile internet browser market, industry experts predict that the software giant will not remain on the sidelines for long.
“Microsoft, with its enormous research and development budget, will end up penetrating this market with a browser that is at least as good,” Christian Jahr, the editor of the Norwegian edition of Computerworld, told AFP.
“But, an advantage for Opera is that Microsoft can’t hope to hold the same dominant position in mobile telephony as it has in computers,” he added.
Having witnessed the monopolization of the desktop internet browser market, the large mobile telephony equipment providers have been reluctant to become dependent on a single provider that could try to encroach on their margins, Jahr said.
“From a purely technical point of view, Opera is the best on the market. The challenge is not on a technological level, but on a business level: To succeed, this Norwegian Tom Thumb must secure and continue to impose (its solutions) on large equipment vendors like Siemens or Nokia,” he said.
And the real battle has yet to begin. The mobile phone Internet market will not really take shape until after the supposedly imminent launch of third generation (3G) telephony, which has already been postponed several times.
Once that happens, “we expect to have a fairly good market share. It won’t be 0%, it won’t be 100%,” Jebsen said.
In the meantime, Opera Software is preparing to be listed on the Oslo Stock Exchange next month and is hoping to be valued at as much as 32 million euros (40 million dollars).
The question, of course, is whether that will be enough to give this Norwegian company a fighting chance once Microsoft climbs into the ring.