Opera has proved a resilient niche player in the browser market, despite the fact that most analysts years ago called that battle in Microsoft's favour. The scrappy private company has geared its business toward areas where Microsoft was thought to be weak -- particularly the market for cellphone and Internet appliance browsers, whose makers are wary of reliance on Microsoft, an operating system competitor. But analysts say that Opera faces an increasingly difficult sell as more and more device manufacturers opt for open-source alternatives -- as Apple did with its selection of KHTML. "The axis against Microsoft, certainly rooted in the (mobile phone) carriers but with the Japanese CE companies starting to make overtures there, is looking more toward open-source solutions," Rubin said. "So Opera is between the rock of Microsoft and the hard space of open source." In addition to their free licensing terms, open-source alternatives give companies like Apple the option of altering the code themselves to suit their own applications. And those advantages are proving open source to be a formidable competitor to small companies like Opera. Tetzchner cited anecdotal evidence to suggest that Opera was continuing to do well on Linux-based devices, and pointed to the company's relationship with IBM, and others, to demonstrate the company's ability to cut deals in the era of open source. He said the primary open-source alternative, the AOL Time Warner-supported Mozilla.org project, was simply too large to be used on small browsing devices. "Code bloat" was indeed a key factor in Mozilla's failure to win the Apple account. But that loss didn't benefit Opera -- it benefited KHTML. Tetzchner brushed off the notion that KHTML would erode Opera's share of the market. "KHTML is not a bad browser," said Tetzchner. "But we believe we have a stronger product."
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