The Licensing Challenge

Michael Gartenberg | May 11, 2007, 11:03 AM

One of things that struck me listening to Nokia discuss their plans to license Series 60 is the basic challenge of licensing to competitors. One reason Microsoft was successful in the PC industry is that it never built PCs. Licensing to folks you compete with doesn't work, either your licensees do better than you do, (in which case often the license revenues don't make up the shortfall) or you do better than your licensees (in which case your licensees wise up and go elsewhere). Apple tried this twice, with Newton (Apple did better than the licensees) and Mac OS (where the licensees, notably Power Computing were doing better than Apple) and they eventually gave up on the license idea. Palm tried it as well and eventually had to split in Palm and Palm Source. There are probably other examples as well.

There might be some strategy here to allow for this to happen (and I can even think of one or two) but until someone can give me a ten word answer on how their strategy differs from either Palm or Apple and how they can build an eco-system, while trying to compete with it, I will remain sceptical.