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Licensing deal is a first for Opera's highly successful mobile effort

Norway's Opera Software ASA (STO:OPERAO), known for its speedy internet browser, has long played the role of creative underdog, pioneering tabs, server-side page-caching, and other technologies later embraced by larger browsermakers.  In the mobile space, it's a far more serious challenger, having offered smartphone browsers since the form factor first emerged in the middle of last decade.  
 
Opera boasts that its mobile browser, Opera Mini, currently has 250 million active users, of which 100 million are on Google Inc.'s (GOOG) Android OS platform (Opera is also available for iOS and other platforms).
 
But for all its mobile gains, Opera was never the official browser of a software platform (to our knowledge) -- certainly not an official browser of a high volume smartphone platform, at least.  That's what makes Opera's new licensing deal with Microsoft Corp. (MSFT) both historic and intriguing.
 
Announced on Thursday, Microsoft has decided to license Opera Mini as the official browser for its S30, S40, and Asha Symbian Nokia phones, which can be viewed either as entry-level budget smartphone devices or smartphone-like feature phones.

Opera Mini on Asha

On the PC, Opera competes with Microsoft's Internet Explorer.  But rather than try to tune Internet Explorer to run efficiently on the low-end ARM Holdings plc (LON:ARM) instruction set architecture (ISA) processors in these budget phones, Microsoft made the decision of simply striking up a licensing deal with its more established rival, rather than trying to squeeze Internet Explorer into a niche it had little experience in.

Opera Mini

Microsoft's Rich Bernardo, who heads what Microsoft titles humorously its "legacy phone business" unit, cheers:

We continue to sell and support classic first and feature phones as well as the Asha range, which have performed well with millions of people who want new mobile experiences at lower price points.  The agreement with Opera will enable us to provide continuity of service as we transition from Xpress Browser to Opera Mini.

Opera's CEO Lars Boilesen, who took over from founding CEO Jon Stephenson von Tetzchner in 2010, adds:

This is a great opportunity to spread the benefits of Opera Mini to millions more consumers in our core markets. There are still massive numbers of people who have not moved to smartphones, but Opera Mini can provide them with an amazing browsing experience right now.

The impact of the deal remains to be seen, as it depends somewhat of how many of the legacy devices Microsoft continues to choose to sell.  The S30, S40, and Asha phones are primarily sold in developing markets such as Southeast Asia, Africa, and the Middle East, but also have seen some sales success in Europe where buyers covet low-cost unlocked handsets.  More recent S Series and Asha models have mirrored the distinctive vibrant, colorful design style better known to U.S. consumers from Nokia's Lumia Windows Phones.
Nokia Asha 230
A Nokia Asha 230

Since Microsoft finished its acquisition of Nokia Devices from Finland's Nokia Oyj. (HEL:NOK1V) the future of Asha and the S Series devices has been made uncertain.  Sales have slumped, somewhat, but demand remains relatively high in aforementioned developing markets where the brand has a strong image.
 
Opera says it has 350 million total browser users, which implies that it has roughly 100 million PC users.  Or put differently, roughly 71 percent of Opera's browser users are mobile, 29 percent are PC-bound.
 
Prior to this deal Opera monetized through licensing deals with 130+ OEMs and carriers who bundled Opera Mini as part of their customized "experience" package for users.  Opera also traditionally has monetized by selling default search engine access to the highest bidder.  Most recently, it has added a browser app/extension market and in-browser advertising for mobile browsers.  The mobile ads represent a particularly lucrative new revenue stream.

Source: Opera Software [press release]





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