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Telefonica's Yotam Ben-Ami fights for Firefox phones (Q&A)

The Spanish carrier has a lot riding on Mozilla's mobile OS. Its director of open Web devices reveals Latin America sales data that show Firefox OS has a shot at becoming the third mobile OS.

Yotam Ben-Ami, leader of Telefonica's effort to sell Firefox OS phones and to get the phone to catch on with mobile app developers.
Yotam Ben-Ami, leader of Telefonica's effort to sell Firefox OS phones and to get the phone to catch on with mobile app developers.

Android and iOS won the mobile operating system wars, right?

Not if you're Yotam Ben-Ami, who as director of open Web services at Spanish carrier Telefonica is responsible for bringing a new competitor to market, Firefox OS. Last week, Mozilla finished Firefox OS 1.1, but even with some shortcomings fixed, the smartphone operating system faces immense challenges competing against Google's Android and Apple's iOS.

But Ben-Ami has some evidence that the open-source, browser-based operating system has a shot at becoming the third operating system for mobile devices. Since its first Firefox OS phones went on sale in July, including the ZTE Open, they've grown to account for 12 percent of the company's smartphone sales in Venezuela, Ben-Ami told CNET.

That's a real foothold, and Firefox OS is developing rapidly, but iOS and Android are hardly standing still. Happily for Mozilla and Telefonica, some other competitors aren't as strong as they could be. Microsoft has a head start with Windows Phone, but has had a hard time competing directly against iOS and Android. BlackBerry OS is in peril. Other options such as Ubuntu Touch have yet to really get started.

Telefonica likes Firefox OS because it brings something different: control. The mobile network operators have ceded a lot of power with the rise of Apple and Google, relegated in many cases to being mere purveyors of dumb pipes. Apple and Google have pushed the carriers aside when it comes to online services such as finding music and buying apps. Firefox OS holds the potential to wrest some of that control away through services that use Web sites and Web apps, not native software written just for iOS or Android.

Ben-Ami, who leads Telefonica's sales, marketing, and ecosystem development push around Firefox OS and the HTML5 technology it uses, discussed his plans with CNET's Stephen Shankland. Here's an edited transcript.

Shankland: What's the biggest reason Telefonica embraced Firefox OS? You had a similar project of your own under way beforehand, correct?
Ben-Ami: We believe that the current mobile landscape is problematic for most stakeholders, as the effective duopoly stifles innovation, limits choices for customers, restricts distribution options for developers, leaves little room for [phone manufacturer] differentiation, and makes mobile network operators' relationships with our most valuable customers problematic. We are backing Firefox OS and by implication open standards in smartphones to redress this imbalance, provide greater choice to our customers, and create more of a level playing field in the sector.

The history of the project is that a team within our R&D department was working on a project to create an HTML5-based operating system. They came across Mozilla's work on Boot2Gecko, which has a similar objective, and approached the team there. Rather than continue working on separate projects we decided to combine our efforts, and this is where Firefox OS originated from. However, as an open-source project, Firefox OS continues to benefit from contributions from various parties, not limited to Mozilla and Telefonica.

How have sales gone so far?
We are very excited about our sales traction to date. We cannot divulge exact sales figures, but we can mention that Firefox now represents over 12 percent of smartphone sales in Venezuela and almost 9 percent in Colombia. Spain figures are also tracking our forecasts.

Android and iOS may have been unpleasant for carriers and handset makers, but customers sure seem to be enjoying the new mobile OSes. Why would they pick Firefox OS over the Android and iOS?
As with any duopoly, customers suffer from lack of innovation and competition. In the case of the current closed ecosystems, customers who wish to switch from one ecosystem to another find that they are locked in since their content purchases are non-transferable. Content purchased on Firefox OS benefits from the truly open nature of the platform and is not locked into any one device or OS. In addition, Firefox OS delivers a streamlined, dynamic, and personalized experience that leverages the open power of the Web to deliver richness in local and long-tail apps, far superior discoverability (a major pain point in today's closed ecosystems) and an exciting user experience. Also, Firefox OS delivers almost a 20 percent battery-life advantage over equivalent Android devices and is a very intuitive and simple to use platform.

What have you learned so far about the software, hardware, or marketing since the first Firefox OS phones arrived on the market?
Our main learning is that by targeting the product to the right demographic, primarily first-time smartphone users, we can gain traction and overcome any ecosystem shortfalls in these early stages. By offering a differentiated smartphone experience and superior value to our customers at the entry level of the smartphone range, we are succeeding in capturing a very relevant market share in a very short time. Comprehensive customer insight combined with the fast release cycle of new software versions for Firefox OS -- every 3 months -- will ensure that the product quickly evolves to fill any gaps that may be present in these early versions.

It seems like Firefox OS, if it succeeds, may curtail the power of iOS and Android. But will it actually restore any power to carriers and handset makers? It seems to me that the winner would be the Web, not early Firefox OS partners like Telefonica, Deutsche Telekom, and Telenor.
Firefox OS is not aimed at restoring power and control to operators. It is an open and democratic playing field. As such, it will allow operators to compete as equals against OTT [over-the-top services such as Skype] players and OS providers. Whether operators capitalize or not on that opportunity is up to each individual carrier, but we clearly believe that early and heavy involvement with the platform positions us well for the future.

As an added benefit, we hope to see the current market players gradually open up their own ecosystems for the benefit of all stakeholders.

ZTE Open
Firefox meets the ZTE Open phone. James Martin/CNET

Realistically, iOS and Android are the big powers of the mobile market. How much chance does Firefox OS really have to change things?
Global smartphone penetration is still only around 20 percent. In addition, in certain territories Android and Apple do not have a dominant position even within the smartphone segments. For example, RIM [now BlackBerry] still has a significant presence in some of our footprint. Consequently, we believe that the game is not over and there is still plenty of room to influence the final balance in this space.

This is a long-term effort, I know. How do you hope Firefox OS, its apps, and its phones will look three years from now?
Firefox OS has the distinct advantage of using the Web as the platform. Currently, there are over 700 million Web sites, vs. around 1 million native apps. This provides far greater richness and capillarity to Firefox OS than any closed, native ecosystem. However, there are certain content verticals where the Web is still lagging, such as communications applications. In the next three years we believe we will be able to fill those gaps, resulting in a far richer and more complete content catalogue for Firefox OS than for any one native ecosystem.

What do you think about higher-end Firefox OS phones at higher prices for wealthier customers?
Our decision to focus our initial launches on the entry-level smartphone segment was a tactical one. We believe this is the price point where we can create value for our customers with the early iterations of the platform. However, we certainly do plan on moving both up market and also pushing the envelope in terms of lower-priced devices in the near future, to ensure we cover all customer demographics.

Customers who've seen what happens with many Android phones might be concerned that Firefox OS phones won't be updated very long since it takes work for the carriers to make sure updates work. Should they have that worry for Firefox OS, too? How long will Telefonica support the software?
It is strategically imperative for us to ensure that our customers enjoy the latest version of Firefox OS. Therefore, we will be offering free OTA [over-the-air] updates to the software in most territories which, combined with Mozilla's fast release cycle, will ensure that our customers always have the latest and greatest version of Firefox OS in their hands.

What are your forecasts for Brazil, where you'll launch Firefox OS later this quarter? It's a huge market. How will it differ from Colombia, Venezuela, and Spain?
The opportunity in Brazil is massive, as it is in much of our footprint. Each one of our markets is different, which is why we localize our approach for every launch. This includes our offer (for example, selecting the right devices and price points per country and developing and promoting country-specific content and tariffs), marketing (by identifying the right target demographic and approach to address that demographic in each country) and [sales] channel strategy. We have set similar targets for Brazil in terms of market shares captured as we have for other key markets in our footprint, but through sheer volume alone this is clearly an important launch for us.