Sendo's end

Sendo has lost the fight to survive in today's competitive mobile market. There are lessons for anyone intent on innovation

The UK's only home-grown mobile phone maker is no more. It's a story that highlights many of the risks in the high-tech consumer market, where technical merit is just a small part of what it takes to succeed.

The company had a solid, original and effective game plan. Using the UK's excellent engineering and commercial skills base, and working with Far Eastern companies that wanted to make phones and get into the European market, Sendo felt it could combine the best of both worlds.

It realised that its customers were the mobile phone networks, not the end users. In the same way that Boeing built the world's first successful commercial jet airliners by adding features to boost the airlines' profits, Sendo created phones that could be swiftly customised for new services. The idea was to produce bread-and-butter models in large numbers, then to move into the high margin game with advanced smartphones.

Although the strategy was sound, reality proved harder work. Sendo made some very attractive phones, but they weren't robust and high failure rates led to network dissatisfaction. Good ideas and good people need to be backed up with an absolute commitment to quality if they're not to be squandered, a lesson frequently ignored in the history of UK high-tech manufacturing.

But the real drama came with the smartphone. We will never know the full story, which lies entombed like radioactive waste under miles of dense legal shielding. The facts are hot enough: Sendo worked with Microsoft for years under the impression that they were co-creating the first Windows mobile phone, called the Z100. Just before launch, Sendo was astounded by the appearance of another device from Hong Kong's HTC — and withdrew the Z100 a fortnight later. The lawsuits flew, with Sendo allegingthat Microsoft had taken Sendo's intellectual property and used it to seed development elsewhere.

The case was settled out of court, and Sendo restarted its smartphone programme with Symbian. But it had lost momentum, and the resultant Sendo X looked clumsy and crude compared to the competition. There was to be no third chance.

The lesson is clear. If you have to deal with a company much bigger and richer than you, and with interests not directly aligned with your own, you have to be very careful indeed. It may be that no matter how good the deal looks, you won't have the resources to defend yourself if it goes sour. In which case, it's better to step back and find another way.

Yet Sendo stepped forward. It may have lost the gamble, but it won't be forgotten.