EMCC hit by ‘unprecedented turmoil’
A SHAKE-UP of the mobile phone software market dealt a fatal blow to the Manchester company EMCC Software, according to administrators.
The company, which billed itself as the leading technology expert in the mobile phone industry, went into administration in March leaving debts of £1.2m and 90 staff jobless.
But until last year the business had seen steady profit growth, rising to £529,000 on turnover of £6.8m in the year to March 2008.
It had offices in London and Poland and worked with some of the biggest mobile phone manufacturers such as Sony Ericsson, Nokia and Motorola, and supplied software to Blackberry and Apple’s iPhone.
According to administrators at BDO Stoy Hayward changes at the Symbian Foundation, a non-profit foundation which “significantly” controlled the mobile software development market, had a profound effect on EMCC’s fortunes.
In June 2008 it was bought by Nokia which granted royalty free access to the software developed by Symbian. This move caused “unprecedented turmoil in the market”, and undermined EMCC, said BDO in its creditors’ report.
A number of key projects were cancelled or put on hold, said BDO. The company started to cut overheads and launched a fruitless search for private equity cash.
During the period from April 2008 to January 2009 the business racked up a £1m loss on turnover of £4.7m. Faced with mounting debts and little prospect of finding additional finance administrators were called in and the business ceased trading.
A spokesman for Symbian described BDO’s explanation as “highly simplistic” and said other industry changes including the general decline in phone sales would have contributed to EMCC’s situation.
She added: “Open access to source code does not remove the need of third party specialists and various other Symbian consultancy companies who had the same market role as EMCC have continued to thrive, despite the marketplace changes of the last 12 months.”
According to the report EMCC owes the Royal Bank of Scotland £250,000, staff £114,000 and unsecured creditors £860,000.
The business was established in 1998 by director Paul Leigh Edwards. He was later joined by fellow directors Anne Edwards, Garry Partington and Alexander Wilkinson.
