Deutsche Telekom Joins Telefonica on Mozilla Mobile-Phone System

Deutsche Telekom AG (DTE) and Sprint Nextel Corp. (S) will join Telefonica SA (TEF) in developing an open mobile operating system powered by Mozilla Corp. to build out a range of cheaper smartphones and take on Google Inc. (GOOG)

Telefonica, Spain’s biggest phone company, will offer the first handsets running the software in Brazil in early 2013 after previously saying the devices will be available this year, according to an e-mailed statement today. Chinese manufacturers ZTE Corp. (762) and TCL Communication Technology Holdings Ltd. (2618) will build the devices, the statement said.

Telefonica teamed up with Mozilla, the developer of the Firefox web browser, on a rival operating system to Google’s Android system to regain more control over the software that powers smartphones. By adding operators, the partners are seeking to build out a viable platform. Deutsche Telekom, Sprint Nextel, Telecom Italia SpA (TIT), Telenor ASA (TEL) and Etisalat are backing the open Firefox system, according to today’s statement.

“Firefox OS will deliver a higher performance than current low cost smartphones can achieve,” said Matthew Key, chief executive officer of Telefonica’s digital unit. “This is crucial for us to accelerate the adoption of smartphones in developing markets.”

To contact the reporter on this story: Jonathan Browning in London at jbrowning9@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

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