Barriers to Entry and Exit (Symbian)

Topics: Smartphone, Mobile phone, Personal digital assistant Pages: 4 (1367 words) Published: October 2, 2008
Market entry and exit constitute major business strategy decisions reflecting a strategic initiative on the part of a firm to develop, or reshape, its product or market positioning Barriers to entry are obstacles in the way of firms attempting to enter a particular market, which may operate to give established firms particular advantage over investment. They are factors that allow incumbent firms to earn positive economic profits, while making it unprofitable for new comers to enter the industry. Barriers to entry may be structural or strategic. Structural entry barriers result when the incumbent has natural costs or marketing advantages or benefits from favorable regulations. Strategic entry barriers result when the incumbent aggressively deters entry. The mobile phone industry has been continuously growing rapidly, with the sales of mobile phone hardware increasing more than 20 percent annually. Originally, cellular phones were just that –telephones. Today, with the third generation (3G) technology, mobile phones have evolved to more than just a normal portable, wireless telephone. These gadgets have since gained the title of ‘Smartphone’. The capabilities of a smartphone depend on its operating software (OS) or its software and this has captured the attention of the giant in the software manufacturing industry, Microsoft. Since then, Microsoft has been an aggressive second mover after the launch of Symbian by the 4 giants in the mobile phone manufacturing industry in 1998. The Symbian OS is an operating system, specially designed for mobile devices with associated libraries, user interface frameworks and reference implementations of common tools. It was successfully launched in 1998. The Symbian OS, based in Psion Software’s EPOC, is structured to work like any personal computer with a fully customizable user interface and since its launch, it has accounted for more than 60 percent of market share worldwide. Thus forming a formidable barrier to entry for the...
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