Symbian explains price cuts

Old tariff remains, with Java


3GSM Symbian took time out to explain its lower royalty structure - and admitted it will add a few 'kinks' to its revenue stream.

The lower tariffs make Symbian OS available for as little as $2.50 per phone, with a ceiling of $4.65. Alternatively, licensees can opt for paying two per cent of the trade price. Currently licensees pay $7.25 per unit for the first 2m handsets, and $5 per unit thereafter, and this deal remains. On average, Symbian takes home $5.14 for each unit sold.

It's really an unbundling arrangement. The two new price structures don't include a bundled JVM. Licensees have to have their own arrangements for Java, and under the original tariff were paying for it twice.

Symbian is clearly expecting the OS to move into the mid-range 'feature phone' market, which accounts for around 200m handsets per year, with its 'single chip'-capable OS, based on a new, real-time kernel.

Actually, Symbian is careful to distinguish between single-chip and single-core phones. Single-chip phones feature separate baseband processors and application processors, but put them on the same die. A single-core phone runs the signalling stack as well as the smart-phone OS, Jorgen Behrens, Symbian's VP of product management and strategy told The Register.

Back to the financials. Symbian can certainly afford to introduce lower prices. The company disclosed to its Q4 earnings today, and CFO Thomas Chambers said the company was now comfortably in the black, with £114.8m in revenue in 2005, more than the £80m he said was required to run the 1,000-strong company. Revenues grew 73 per cent over 2004, and shipments rose 136 per cent year on year. In Q4, Symbian sold 10.89m licences, up from 8.54m in Q3.

Royalties brought home £30.7m of the £34.6m of revenue booked. Nine licensees have products in development, down from 12 a year ago. ®

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