The first smartphone with the Linux-based OS shipped at the end of 2013. Adoption of Sailfish has been weak, however, and Jolla is selling only one smartphone model, via the company's website, for about US$303. It's a Jolla-branded phone, made by a third-party contract manufacturer. A tablet is also available for preorder.
Jolla is restructuring debt in its home country, Finland, after a round of funding fell through. The company announced Friday that it will lay off "a big part" of its staff, without giving many details of future plans. The company did say it would be tailoring the OS to fit the needs of different clients, and that it has several "major and smaller potential clients." It also said Sailfish is stable and ready for licensing.
For analysts, Jolla's collapse wasn't a surprise. In a copycat market, Sailfish offers cool customization features, for example. But it doesn't have the backing of device makers or carriers, which is crucial for survival.
The China market was a big focus for Jolla, but Xiaomi took the country by storm with end-to-end offerings including OS, user interface and hardware, along with the creation of a developer ecosystem, said Carolina Milanesi, chief of research and head of Kantar Worldpanel ComTech.
Many alternative mobile OSes like Ubuntu, Firefox, WebOS, Blackberry and others are in the same boat as Sailfish, trying to find a niche in a market ruled by Apple and Google. The biggest competitor to Android and iOS is Microsoft's Windows Phone, which had just a 1.7 percent market share in mobile handsets, with 5.87 million units shipping during the third quarter this year, according to Gartner. That is down from 3 percent (9.03 million handsets shipped) in the same quarter a year earlier.
A Gartner analyst said Windows Phone could find adopters in the enterprise market. But Jolla doesn't have the resources of Microsoft, of course, and this raises questions about the future of Sailfish.
There are some exceptions in the tough mobile OS market, like Tizen, which has carved out a niche in wearables, vehicles, appliances and electronics with backing from Samsung. To try to stay afloat, Jolla may pursue a similar strategy, trying to get Sailfish into devices other than mobile phones, Milanesi said.
Jolla expanded Sailfish from smartphones to tablets, and could scale the OS down to wearables, said Chris Jones, co-founder of Canalys Research.
There is space for a new OS in wearables, a market that is now emerging, but Sailfish would need to be different from offerings like Android Wear and Apple's watchOS, Jones said.
It is also of primary importance that Jolla retain and attract more app developers for Sailfish, analysts said.
As for the small number of Sailfish users, the recent events at Jolla raise questions about the OS's future. Users of Jolla phones, some of whom are enthusiasts and helped develop Sailfish, will likely be loyal to the OS and "will stick with it if they can," Jones said. However, if the company fails to develop the OS in a timely manner even loyal fans may switch over to Android or iOS devices.