There’s a disruption around the corner for the smartphone industry

Smartphones have been a very profitable business. But now things are changing, what does this mean for SMEs?

It’s been a long time since we’ve had a three or four-way war in the technology industry, with most sectors settling down into a two-way fight between alternatives.

Mozilla’s promised $25 smartphone project threatens to open the mobile industry into a three-way battle just as it appeared the market had comfortably settled down into an Android and iOS duopoly.

Now we see a three-way race and possibly four if Samsung can get traction with its Tizen operating system that it’s bundling into the latest version of the Gear smartwatch.

One positive aspect of this is that three of the participants – Firefox, Tizen and Android are relatively open, so compatibility between them isn’t impossible.

For Google and Apple though, this four-way tussle presents a problem to their business plans.

Apple’s iOS ambitions of putting the software in smarthomes, connected cars and, possibly most lucratively of all, into retailing with iBeacon are threatened by a fragmented market and a rapidly eroding market share.

For Google, both Firefox and Tizen threaten the dominant position of their Android operating system that forms a plank in the company’s ambition to control the planet’s data and become an ‘identity service’.

Worse still for Google’s information ambitions, Firefox is working with Deutsche Telekom on a security initiative that will lock away users’ data.

So the stakes are high in the smartphone operating systems wars.

It’s early days to forecast the demise of either Android or Apple iOS, which is unlikely in the short term, but if Firefox’s operating system does take hold it will mean the smartphone industry is about to become a lot more complex.

For the rest of us this means opportunities as new business models evolve around the new breed of cheap smartphones.

There’s also a broader issue to consider with the smartphone wars; that no matter how profitable your business is, there’s a disruption waiting around the corner.