Responding to tough competition from mobile-phone powerhouses Nokia and Motorola, Matsushita (Panasonic) and NEC may form a joint venture around Linux-based mobile phones, according to several news sources in Japan, as reported by Reuters. The venture may focus on Linux OSes and applications, mobile phone hardware, and/or mobile phone chips, and may include Texas Instruments (TI), the news… service reports.

According to the business paper Nihon Keizai, based in Nikkei, Japan, as reported by Reuters, Matsushita Electric Industrial and NEC may form a 50-50 joint venture focused on developing Linux-based operating systems and application software for mobile phones. The paper expects the venture to launch in October, have a capitalization of about 100 million yen (about $857,200), and employ about 200.

Another Japanese business paper, based in Mainichi, says the venture will also develop and manufacture phone hardware, according to Reuters.

The Nikkei paper, meanwhile, has also reported on the possibility of a three-way venture between NEC and NEC Electronics Corp (44 percent), Matsushita and Panasonic Mobile Communications (44 percent), and TI (12 percent). In addition to phone hardware and software, this venture would include mobile phone chip design.

Background

The NEC/Panasonic mobile phone collaboration could be driven by losses at Panasonic Mobile Communications parent company Matsushita Electric. Despite success in Japan, NEC and Panasonic have had trouble competing with comparative giants such as Nokia and Motorola Matsushita in the world phone market, and a Matsushita Electric re-org in December of last year saw the company abandon its GSM phone efforts, in order to focus exclusively on W-CDMA technology.

However, in Europe, where W-CDMA-based FOMA service is increasingly available, sales of Japanese phones have been hurt by their relatively large size, according to Purple Labs, which developed the dimunitive Linux-based G500i Dreamphone marketed by Grundig.

NEC and Matsushita's Panasonic Mobile Communications first collaborated in November of 2004 on a jointly developed Linux stack for 3G phones, which was based on MontaVista Linux. The stack has subsequently been used in three generations of W-CDMA phones from both companies, including NEC's N900x, N901x, and N902x phones, and Panasonic's P900x, P901x, and P902x phones.

NEC and Panasonic also recently partnered with Motorola, DoCoMo, Samsung, and Vodaphone on a project aimed at creating an open Linux implementation for mobile phones.

Additional details may be available in the Reuters story, here.

 
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