I should say that I was also negatively surprised by Dr Jaaski comments. I should also say that I am somewhat uncomfortable with Nokia's ambivalence: clearly, they do great things for open source but they also come from a closed source culture and that shows.


Maybe we should see this from the business point of view. When I hear about the "cell phone industry needing DRM and locked parts" I suppose that Dr Jaaski is thinking about the demands of carriers and the fact that most end users buy subsidized phones with what is basically "pay by lock-in". For this business model, the phone needs DRM and locks so that the customer can be forced to keep paying for the contracts and has no choice where to buy his software (music, games, ringtones, etc...). It is a business model invented by Gillette a century ago: give the razor for free, and make profits on the blades.

This is a good model for the industry, because it ensures a more regular cash-flow (regular payments instead of a one-time buy), and usually brings more revenues, since the total price is hidden (more than one young people ended up broke from their cell phone bill).


But is this the only possible business model? Certainly not. There is a sizeable portion of the market which prefers unlocked phones, and are prepared to pay the upfront costs. And those are the people who bought the tablets, which did not sell so bad at all. Interestingly, most proponents of the open source model are like that, so the reactions to the DRM and locks comments are not surprising.


In the end, it is down to the customers. Many customers prefer subsidized phones, and are prepared to live with locks. That is one side of the market. But Nokia should not forget about the other side of the market: people who want open devices, and are prepared to pay the costs upfront. That market is small, but it cannot be that small. And it is underserved by the industry, so there must be a business opportunity to take.


The challenge will be to keep the upfront price low enough, considering that development costs will be spread on a relatively small market base. For this, Nokia has unique advantages, because it is a world company with good distribution channels in place.