Apple Wobbles as Mobile World's Walls Come Down

Openness. Choice. Balance.

These are the early buzzwords at Mobile World Congress, the industry's massive annual confab whose expected crowd of 70,000 in its third decade of existence gives matches at nearby Futbol Club Barcelona a run for their money, and cabbies in these difficult times for Spain a momentary respite. And it's these A sad Macintosh icon is seen on the exterior of Apple's 14th St store in New York. REUTERS/Lucas …words which, despite the unusually chilly air and even frostier European economic climate, are giving the telecom executives gathered here a bit of a spring in their step.

More than anything, this year's conference seems to mark the end of Apple's (AAPL) mobile world dominance and the rise of rival devices that run on more open, developer- and network-friendly operating systems. Case in point: Mozilla's Sunday-night, unofficial conference kick-off event. The nonprofit whose Firefox browser a decade ago helped dismantle Microsoft's (MSFT) chokehold on web browsers is now similarly looking to upend the mobile device market. The industry at present is "unnaturally controlled by a few parties," Mozilla's chief executive, Gary Kovacs, declared as he unveiled the first generation of Firefox OS devices and partners.

(Read More: Hottest Trends in Mobile Devices)

And the two-dozen telecom execs who helped launch Firefox OS reiterated that sentiment.

"We are changing the industry for the better of everyone," Cesar Alienta, the chief executive of Telefonica, the Spanish-based telecom which is one of the worlds largest, said on-stage at Mozilla's event Sunday night. This after lashing out at "closed operating systems" (read:Apple) and warning that "the smartphone world is moving backwards" from the openness of the web-based internet. Telefonica plans to shortly introduce Firefox OS-based devices to its customers in Spain, Brazil, Colombia, and Venezuela.

America Movil, owned by the world's richest man, Carlos Slim, has meanwhile committed to launch Firefox OS phones in Mexico and "all possible markets" as soon as possible. "I believe this is the beginning of the end of walled gardens," the company's chief marketing officer Marco Quatorze said on Sunday. Deutsche Telekom's outgoing chief executive Rene Obermann, whose company will introduce Firefox OS devices in Poland this summer, called it "an important step on the way to more competition between the different ecosystems."

And Mozilla isn't the only company seeking to level the mobile playing field. Samsung (Korea Stock Exchange: 593-KR)and Intel (INTC) are in development on an operating system known as Tizen that will reportedly be more open and customizable for developers and networks than Apple's iOS certainly, but also Google's (GOOG) Android. Networks, for their part, are drooling over the possibilities to tinker with operating systems in order to interact more directly with customers. As one NTT Docomo executive put it to CNet: "If we become a dumb pipe, our revenue will continue to shrink."

The irony, of course, is that the success of Tizen would lessen Samsung's need to rely on third-party platforms like Google's Android, perhaps giving the company even more power over the mobile market. In other words, the rush of new entries to market isn't just about the greater good of smashing open operating systems.

(Read More: Yahoo CEO Mayer Cracks Down on Remote Workers)

In fact, it may simply be that the rest of the world has finally caught up with Apples once-pioneering mobile platform.The onus is on Apple, then, to innovate its way forward or else be cannibalized by cheaper, more accessible rivals. Trouble is, the smartphone market matured, meaning the real opportunity anyway may lie more in getting mobile devices into the hands of emerging-world users. Call it smartphone wars or "platform wars," but its clearly become a race to the bottom in the mobile world, however lucrative that "bottom billion" may be.

• Cars Are Big Smartphones on Wheels: AT&T CEO
  
• Microsoft Gets Hacked; Similar to Attacks on Apple, Facebook
  
• One Quarter of US Has More Card Debt Than Savings