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By Ingrid Lunden

Google’s (GOOG) Android smartphone OS is facing a lot of challengers in the low-cost smartphone segment, from Huawei, ZTE, Samsung and Nokia (NOK) at the vendor end to Mozilla coming from its position in browser software. But for the short term it appears as if there is little for Android to worry about from any single contender. Research out today from Strategy Analytics notes that one of these, Firefox OS, (Mozilla’s mobile effort) will only sit on 1% of all global smartphone shipments in 2013. That's vs. 67% for Android, and it could take up to two years for it to turn that around.

To be fair, Firefox has made some headway with carriers and OEMs with its low-cost focused smartphone OS -- those that backed the company’s mobile OS efforts in July include Telefonica, Sprint (S), Deutsche Telekom and ZTE. The low-cost, sub-$100 device smartphone segment is a growing one, with Deloitte projecting there will be 500 million of these sold this year alone.

But for now, that growth is a story with Android as the protagonist. Strategy Analytics says Firefox OS will continue to remain "niche" because of low brand awareness, limited retail presence (especially in the U.S.), and an ecosystem of developers that is still too small. Those are challenges that will also give it problems growing market share in tablets, an area where it hopes to make some headway not only against the iPad but lower-cost Android-based tablets.

The first handsets built on Firefox OS are expected to come out in the first half of 2013. They will be targeting the low-cost smartphone segment rather than doing battle at the higher end with Apple (AAPL) and Samsung’s Galaxy line. That is an area that, up to now, has been largely dominated by Android, with phones costing as little as $100 or less without any subsidies. Among other challenges, Nokia is trying to take its still-strong position in the feature phone market and leverage it better in the smartphone segment, where it has been struggling for years.

Firefox OS, like Android, is open-source. Rather than looking at creating a native ecosystem, it is putting its eggs into the HTML5 mobile web basket. But is coming into the low-cost market at a time when Google has cornered it in just about every region. "Overcoming Android will not be an easy task," says Neil Mawston, analyst with Strategy Analytics.

But he also points out that this doesn’t mean Firefox is doomed -- just that Mozilla and its partners will need to remain patient to see whether it takes off. "It took Android just two years from commercial launch to overtake Symbian and go from new entrant to established global leader, so things can change extremely fast in the smartphone industry," Mawston told TechCrunch. Android launched commercially in Q4 2008 and was No. 1 by Q4 2010, according to Strategy Analytics' calculations. And the challenges are not exclusive to Firefox OS. "At the moment, none of the emerging smartphone platforms, such as Firefox and Tizen, has the hardware, software and services capabilities to match Android or Apple," he said.

But as the smartphone market continues to grow, it will see further price pressure -- especially from developing markets full of first-time smartphone buyers. That presents a chance for growth. Mawston said that Firefox and Tizen are "cost-competitive, and this gives them an opportunity to make some gains among price-sensitive mass-market consumers in the early phases of their strategies."

Still, he notes that new platforms like Firefox OS and Tizen are "Android challengers rather than Android killers at this stage."

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Original Post

Source: Firefox OS Will Have 'Niche' 1% Of Smartphones In 2013, As Android Corners Low-Cost Segment