These Tech Stocks Should Watch Out for Mozilla

Samsung and Apple  (NASDAQ: AAPL  )  may steal all of the spotlight when their new phones debut, or even when rumors of their phones surface, but some think there's room in the mobile OS space for more competition -- and Mozilla wants in.

A new hope
Right now, Google's  (NASDAQ: GOOGL  )  Android and Apple's iOS take a whopping 85% of the global smartphone mobile OS market share. BlackBerry (NASDAQ: BBRY  ) and Microsoft (NASDAQ: MSFT  ) currently spar over the third place position, but according to the latest calculations from Gartner, Microsoft's platform is expected to far outpace the Canadian company's OS by 2017 -- and leave BlackBerry in a realm of potential mobile insignificance.

Firefox Mobile OS. Source: Mozilla.

But despite Microsoft's possible dominance over BlackBerry, Mr. Softy is still struggling to find its way in mobile tech and only has about 3% of the smartphone market share right now. Because iOS and Android are so far ahead of the pack, the opportunity for companies like Mozilla to wiggle into that space is wide open.

Mozilla's plan is already under way, and just yesterday the non-profit company sold out of 1,000 developer-launch phones loaded with the Mozilla OS in just a few hours. The company, in collaboration with Geeksphone, sold $119 Keon models and $194 high-end versions called Peak for developers to test in real-world situations and on mobile networks.

Unlike the other mobile tech companies, Mozilla's OS is built on HTML5. Because its apps will run off the new web standard, the Mozilla OS phones require less internal storage than traditional smartphones. This difference is expected to keep the cost of phones much lower than even low-end phones running Android. OEMs could benefit from the OS because it will help them keep costs down and still sell products with similar capabilities of more expensive phones.

For carriers, of which Mozilla already has 17 signed up, the benefit lies in being able to sell comparable phones for less money. Additionally, since the apps are built on HTML 5, developers can create apps that work across multiple devices and have less restrictions than app stores.

Who might lose in all of this?
Mozilla will officially launch the new mobile OS this summer in countries like Poland, Spain, Venezuela, Hungary, Brazil, and Mexico, with a U.S. and U.K. launch planned for sometime in 2014.

It's not likely that a newcomer like Mozilla OS will have any significant impact on Apple and Android, at least not in the sense of knocking either one of them out of their top spots. But Mozilla will increase competition among the smaller players, as well as others trying to enter the mobile OS market. Mozilla currently has one of the world's most popular web browsers, with half a billion users. There's room for significant mobile influence when you're talking about those kind of numbers.

That's bad news for tech stocks like BlackBerry, who will likely face the stiffest competition over the next few years, but it should also be troubling for Windows Phone maker Nokia  (NYSE: NOK  ) . Unlike some other Windows Phone makers, Nokia is completely dependent on the Microsoft platform succeeding. If Mozilla becomes a formidable opponent to Windows Phone, then Nokia could suffer. Nokia's stock has already taken a pounding over the past few years as the company has lost its mobile dominance throughout the world, and a new competitor wouldn't help. 

For Samsung, which already enjoys mobile dominance right now, two scenarios could play out. The first being that Samsung sticks with Android and experiences a slight decline in market share as Windows Phone and Mozilla creep up over the next four or five years. The company's currently in a great position against practically every competitor, so it's doubtful this scenario would hurt it too much.

The second scenario involves Samsung launching a full-scale mobile approach with its own mobile OS, Tizen. The company will sell a few Tizen phones in small markets later this year, but the company's still extremely dependent on Google. If Samsung does move away from Android, it could also team up with Mozilla and use the company's OS instead of its own version. Mozilla and Samsung are already working on a new mobile browser in an effort to cut out Google's Android and Chrome browsers. A mobile OS agreement between the two could be mutually beneficial for both companies. Samsung could move away from Android, while Mozilla would gain significant OS share because of Samsung's current reach.

But like so many things in the mobile space, we'll have to wait and see how this all plays out. Investors in tech stocks would be wise to keep track of Mozilla's new OS, as well as its partnership with Samsung. The fate of many technology companies rests on mobile, and any increased competition could be fatal for some.

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Read/Post Comments (10) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 25, 2013, at 5:04 AM, Mikeycollins13 wrote:

    Truly only a FOOL would lay all the negativity from this OS to Blackberry.

    Clearly, Blackberry is going to lose all its Enterprise clients, BBM fans, Keyboard lovers, and B10 fans to this new Firefox OS?

    The thought process in this article is...well, just lacking.

    The victims here are going to be Apple and Android firstly.

    Sometime UGC blog sites really disappoint in the quality of the writting, this one of them.

  • Report this Comment On April 25, 2013, at 7:36 AM, FoolishGoph wrote:

    You do not mention Sailfish in your article. Also somehow Microsoft is the big winner in the midst of all this competition? The smartphone sector is going to be very interesting the next 18 to 24 months.

  • Report this Comment On April 25, 2013, at 8:17 AM, TIMNPAWC wrote:

    Please stop referencing old Gartner statements! First of all, Gartner collects data, analyzes data and then reports on same data. That means the Gartner report data was six months old on release. This also means that it was collected during the year where Blackberry had not released any products in over a year and had delayed BB10 twice!

    Blackberry had 6% market share at kickoff of BB10 and is trending towards 10% within the 1st year. Apple has 17% international smartphone market share and has started to hit a ceiling, calling for single digit growth. Blackberry has room to grow and could see 50% growth in first two years and 15% international market share by 2015.

  • Report this Comment On April 25, 2013, at 8:21 AM, infektu wrote:

    BBRY has a finished OS, solid, polished and well reviewed, 100k apps for OS10 and counting. Devices started to ship, plenty in channel, with with carriers and resellers, first sales numbers are in.

    But hey, it's "too little too late".

    But then, babaaam!, Mozilla puts out some developer phones (for sale) and suddenly an open project in beta is deemed the next big mobile sliced bread. The developers will magically flock to a completely new platform with an open-source future for unknown reasons, when they can already see that making a buck on Android is tricky.

    This logic eludes me completely. And if indeed Mozilla is to succeed (I personally root for it), it is still incomprehensible why would it harm BBRY more than others, especially since you have noticed yourself its heavy reliance on HTML5, which will supposedly make the devices "much lower cost than even low-end phones running Android".

    Low-cost Android phones is not exactly BBRY's competition and more (and better!) HTML5 apps will be an absolute boon for BB World.

    But hey, you reach the conclusion you want to reach...

    Also, the "latest calculations from Gartner" cracked me. Even the most dishonest crystal-ball fortune teller admits he makes predictions.

    So yes, please do come back to this article in 2017, see how those "calculations" on M$ vs. BBRY :-) will have panned out and entertain us with a spin.

  • Report this Comment On April 25, 2013, at 9:06 AM, TimKnows wrote:

    Too many errors to even comment on this rag.

  • Report this Comment On April 25, 2013, at 9:17 AM, Chippy55 wrote:

    BBRY stock is now shorted to the tune of 164 million shares, 33% of the total float, and ALL those shares HAVE to be bought back. There's also the fees involved to shorting and also a "negative rebate" just for the privilege (lol) of borrowing shares to short. When the big short squeeze happens, which side do you want to be positioned on?

    Key BBRY dates: Q10 will launch in the UK tomorrow and in Canada next week on may 1st, and in late May in the U.S. So in roughly one month we'll have 3 launches on the Q10 and BBRY also has 3 more products slated for debut this year.

  • Report this Comment On April 25, 2013, at 10:23 AM, Oril wrote:

    Every time shorts sell a share they borrowed they create another long.(the buyer of the shorted share).

    That makes two longs, the original owner and the last buyer. Meanwhile the stock keeps going up 3 to 5 percent a day and the shorts keep making more longs as the company goes about its business.

    Someone is going to get hurt in this ponzu scheme by the shorts. Do you feel lucky. Lol

  • Report this Comment On April 25, 2013, at 11:56 AM, verces wrote:

    Somebody had mentioned that the there will be Bears attack today and it's happening.

    It is so pathetic.

  • Report this Comment On April 25, 2013, at 12:28 PM, eidsonb wrote:

    And throw in the whole laughable prediction that Microsoft will have any share in 2017....WP8 is a NIGHTMARE and a dog. One would think that after 18 tries at it that MSFT could get it right....BB10 is a game changer and will be till he next big thing,,,,and unless Apple moves off of the UNIX based iOS it will not be them....

  • Report this Comment On April 25, 2013, at 1:06 PM, verces wrote:

    BBRY and BB investors as I've mentioned should put their position all out for sale at a higher price, this way the system will not allow those shares to be borrowed by shorters. Put it good until cancelled and make modification as necessary. If you dont thise shares will float in the inventory and whatever bullishness we have for Blackberry will be jur a waste of time as those bears can always do whenever they want to degrade the stock -

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