Nokia is to acquire Psion's stake in the Symbian mobile operating system and become its majority shareholder with 63 percent of Symbian Ltd. Symbian now looks like a Nokia operating system, with other players likely to use it only for niche products, said analysts.

The deal includes all of Motorola's original holding, which Motorola sold to Nokia and Psion in August 2003. The deal, worth £136 million, comes after rumours that Nokia intended to buy Psion outright to win control of Symbian.

"This confirms the popular belief that Symbian is largely synonymous with Nokia and is now directly controlled by it," said mobile data specialist Dean Bubley of Disruptive Analysis. The remaining Symbian partners declined to buy any of the Motorola or Psion shares, he points out. "This indicates that most other Symbian licencees are using the OS just for niche products, rather than core and strategic parts of their product line." This is especially true of those basing products on Nokia's Series 60 platform, Bubley said.

Nokia promised that Symbian's governing structure would remain independent in a press release. "Symbian will continue to pursue its fair and non-discriminatory licensing business of the standards-based Symbian operating system (OS)," it stated.

Symbian played it diplomatically: "Although this transaction remains to be completed, it is appropriate to recognise the immense contribution Psion made to Symbian in terms of the early development of what has now become Symbian OS and in much of the original strategic vision behind the company," said David Levin, chief executive of Symbian Software. "I am delighted that Nokia is making this commitment to invest further in Symbian and to endorse Symbian's strategy and operational activities, as an independently governed company working with partners across the mobile industry."

Psion, which created the original Symbian operating system and its predecessor EPOC, was a founder of the consortium. Now, it appears it wants to raise cash for its core Teklogix division, which last year launched a non-Symbian handheld computer, the NetBook Pro.

Symbian has gone up significantly in value - from £300m to £436 million - since the August 2003 Motorola sale. Investors obviously feel Psion sold out for too low a price though. Its shares fell more than 30 percent on the announcement, according to the Financial Times.

The deal will see Nokia pay a fixed sum of £93.5 million (US$172.4 million) and a variable payment of £0.84 for each Symbian OS-based device sold during 2004 and 2005. In return, it will see its stake in Symbian rise from 32.2 percent to around 63.3 percent.

Psion estimates 18.7 million Symbian devices will be shipped this year and 31.5 million in 2005 - a market worth £135.7 million. The fixed payment will be made on completion of the deal and the variable payments made in March 2005 and March 2006, said the company. It also retains a right to a higher payout should an IPO (initial public offering) of Symbian take place before the end of 2005.

The other shareholders in Symbian are Panasonic, Samsung, Siemens, Sony Ericsson and Ericsson.