Research firm Zelos Group predicts that by 2008 sales of full-featured handsets, mobile phones or smartphones that incorporate full-featured operating systems such as Symbian, Windows Mobile, Palm OS and Linux, will grow to about 290 million, or about 43% of global handset sales.

Evern more interesting is Zelos' prediction that mainstream adoption of these devices will have a significant, disruptive impact on the entire mobile electronics sector. "The mass adoption of full-featured handsets will be disruptive," said Seamus McAteer, senior analyst and managing partner, Zelos Group, the report's author. "Consumers will substitute use of PDAs, digital cameras, gaming consoles and music players. An early indication of this is Nokia becoming a leading distributor of digital cameras."

Zelos thinks there is no economic reason to question why growth will not be explosive, as full-featured handsets will be available from manufacturers at price points as low as $157 in 2006, close to the market average selling price for a mobile phone of about $138 in that year.

Based on Zelos analysis, the long-term prospects for Linux as the preferred operating system for connected devices are very strong. Zelos Group scored all mobile platforms across five criteria: business viability, completeness, cost, end user appeal and openness. Linux scored highest on the two criteria that matter most to OEMs and carriers: openness and low cost, whereas Microsoft scored lowest in these criteria.

Although Microsoft will be a powerful contender against Symbian in the next two years, it will not dominate the market in the long-term. Microsoft will seek a premium for the Windows brand and will seek to promote its own proprietary take on open standards.

"Symbian beats Microsoft due to the flexibility of its licensing terms," commented McAteer. "Microsoft's prospects will be stymied to an extent by its desire to strictly manage how its brand is used. Although we expect at least five million Windows mobile devices to ship in 2004, we find it doubtful that Microsoft will succeed in its stated goal of shipping over 100 million mobile devices running Windows in 2007."