Mobile
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Vodafone’s got Internet brands on its mind this week, and announced today that the company will offer YouTube content to its mobile subscribers over Vodafone live. Like the Verizon Wireless-YouTube deal, it’s another one of those services where the companies will provide the user with “a daily selection of new videos” — i.e. a truncated lame version of the online service. Ah, well, it’s still a little closer to what we want from the mobile web.
And, it’s the third partnership between Vodafone and a major Internet brand this week! Thursday it was a deal with eBay to provide a mobile eBay application that enables users to browse and bid on stuff and buy fixed price products from cell phones. Earlier this week it was a mobile application for MySpace.
We guess Vodafone CEO Arun Sarin wasn’t kidding when he professed his company’s newfound interest in mobile social networks, mobile video, mobile advertising and advanced mobile applications. The company announced a mobile advertising deal with Yahoo last year. And he told Business Week that he expects all these mobile content services to generate 10% of the company’s revenue within three or four years.
Yowsers — that’s a huge amount of revenues. But the company needs to do something. The carrier reported an operating loss for the six months ending in September 2006. Voice revenues just aren’t growing like they used to. Like Om says here, a mobile operator facing the prospect of slowing growth does a lot of strange things.
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Written by Katie Fehrenbacher on February 10th, 2007 with no comments.
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If you like local politics, bureacracy and a drawn-out waiting game — tune into San Francisco’s ongoing Wi-Fi plans. I did yesterday, and spent three hours sitting through the city’s Budget and Finance Committee meeting, watching community advocates fight and supervisors play politics. One things for sure, the plans are as on-hold as ever, despite the initial approval.
A resolution requiring a more thorough study of citywide broadband options has made it through committee, and now awaits a vote by the full Board of Supervisors in two weeks. If passed, this resolution would delay any finalization of the contract with Google and Earthlink for at least a “couple of months,” according to Supervisor Jake McGoldrick, who sponsored the resolution.
The resolution was drafted after the city’s budget analyst recommended considering alternatives to the deal, which is being championed by the Mayor’s office. The board’s support for the contract is mixed. I have a hunch that the board will vote for further study, but will face a veto from Mayor Gavin Newsom that they won’t have enough votes to overturn.
The hearing brought out a number of familiar faces. McGoldrick, the resolution’s sponsor, sat in attendance along with committee members Chris Daly, Bevan Dufty and Tom Ammiano.
Daly can generally be counted on to oppose moves by Mayor Gavin Newsom, and may feel more strongly doing so now given Newsom’s recent rash of embarrassing personal news; Dufty, long considered a staunch ally of the mayor, has become much less predictable; and Ammiano, the senior member of the board, has been a champion of a municipally owned and operated fiber optic backbone network for years.
Google, which recently made a move into The City, was representated by Megan Quinn. She was joined by Alex Clemens, who’s Barbary Coast Consulting specializes in helping companies navigate the murky waters of San Francisco politics. Google is one of his clients, and I had received an email from him earlier in the week asking folks who supported the Google deal to turn out for public comment at the meeting.
And the public certainly did turn out to comment (video will be available here). In an unscientific survery, I counted about two supporters of the contract for every detractor, though Google hosted
a number of community events to drum up support during 2006. Members of the community who hope the deal includes funding for ‘digital inclusion,’ such as Sister Petra Chavez of Caminos, argued that the faster the deal goes through, the sooner they can begin working on bridging the digital divide.
Thankfully, all the discussion focused on the merits of the case — all too often in San Francisco, policy often boils down into a fight between the mayor’s office and the board, and considering Newsom’s recent struggles, it could have gotten very, very ugly.
For their part, Google doesn’t seem terribly discouraged. “We look forward to continuing our work with the Mayor’s office and EarthLink to provide free Wi-Fi access to the over 1 million residents and visitors of San Francisco,” said Quinn.
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Written by Jackson West on February 9th, 2007 with no comments.
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Say it ain’t so. ESPN’s mobile service has returned from the grave and is nursing itself back to health over on Verizon Wireless’ VCAST service — not another MVNO, but a proper mobile content deal.
Verizon and ESPN announced a deal Thursday morning (AP had it late last night) to offer ESPN’s sports content and application over VCAST’s subscription service as well as over Verizon’s upcoming MediaFLO mobile TV service.
The Sprint MVNO partnership was just the wrong business plan for the sports content company. Was it the MVNO model or the Sprint deal? Probably both:
“For ESPN, this is the right strategy and the right carrier relationship to grow our business while serving millions of sports fans . . .” press release, Salil Mehta, executive vice president, ESPN Enterprises
ESPN getting back into the mobile business through a standard mobile content deal, speaks volumes about last year’s misplaced MVNO enthusiasm. It takes a ton of money to build any kind of sizable wireless carrier business. ESPN learned the hard way.
Now Amp’d and Helio are spending cash like crazy and a year into Amp’d’s service they say they have 100,000 subscribers — Helio says it’ll reach 100,000 next quarter, when it reaches roughly a year old.
Good thing for Amp’d the company is private and doesn’t have to report its financials. Helio isn’t so lucky, with parent companies SK Telecom and Earthlink. This week SK Telecom says Helio’s losses will reach between $330 million and $360 million in 2007, up from $192 million in 2006. Earthlink has reported a fourth-quarter net loss of $24.8 million compared to a profit of $29.2 million a year earlier, largely thanks to Helio.
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Written by Katie Fehrenbacher on February 9th, 2007 with no comments.
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Skyhook Wireless, a Wi-Fi location-based services startup, has gotten the majority of its headlines due to its cutesy Loki browser plug-in, which adds loction to search and other web services. But the company has a whole lot of plans that have nothing to do with the web. The most interesting are for locating handheld and mobile devices, and on Thursday the company plans to announce that GPS chip and software company SiRF will license its technology to offer a dual GPS/Wi-Fi location based system for phones.
Skyhook CEO Ted Morgan said Wi-Fi can help GPS in locating a device in problem areas, like dense urban environments or indoors. Wi-Fi can also help GPS devices when they are trying to get a first location fix, which can sometimes take quite a bit of time to ‘warm up’ using GPS — Wi-Fi can be much quicker, says Morgan. Morgan will be demoing the new location offering at 3GSM next week, so if you’re interested go check it out and tell us how well it worked. (We’re skipping the Barcelona bash this year.)
The Boston-based company, founded in 2003, has raised at least $8.5 million from investors like Bain Capital Ventures and Intel Capital. The SiRF deal is the startup’s latest mobile partnership, following one announced at CES where Skyhook says it teamed up with Korean company ReignCom (which is behind the iriver brand), to include Skyhook’s Wi-Fi LBS technology in its iriver W10 portable media player.
All types of Wi-Fi enabled devices could benefit from the Wi-Fi LBS add, though, we’ll see how interested mobile manufacturers are in the dual GPS/Wi-Fi SiRF deal. The company will try to get those design wins this year, and hopefully land on products after that.
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Written by Katie Fehrenbacher on February 8th, 2007 with no comments.
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Truphone, a mobile VoIP service provider based in Kent, U.K., is planning to announce more Symbian handsets that can run its VoWLAN software, including newer S60 and UIQ devices, at the upcoming 3GSM show in Barcelona, Spain.
The company plans to support up to 25 handsets by the end of 2007, including Windows Mobile-based smart phones, TruPhone Chief Executive James Tagg said in an interview. Along with the added handsets, the company announced today that it has added interoperability with Google Talk (GigaTeam is happy about the news as we spend a lot of time using the Google service).
Truphone is one of a growing number of companies that are looking to bring low-cost VoIP calling to phones with either Wi-Fi or 3G capabilities. This group of start-ups has been receiving liberal doses of funding from the venture capital community. Truphone recently got £12.5 million ($24.5 million) in Series A funding from Wellington Partners, Independent News & Media, Burda Digital Ventures and existing investors.
The company works out of a converted barn in Kent, has 25 employees and is now working on putting more value-added features into its client. “We want to use cheap voice minutes to attract customers and then offer more services on top of that,” says Tagg. Truphone plans to soon offer services such as SMS-over-IP, video over IP and location-based applications. “We are also looking at gaming over IP via Wi-Fi,” says Tagg. Many of these features could be available by the middle of 2007.
“This year 60% of our revenues will come from voice, and by next year (2008) we hope to bring that down to 40%,” Tagg told us. He thinks it is part of a larger industry trend. He predicts that in 10 years the bulk of a carrier’s revenues will come from non-voice services. But that’s in a decade – for now voice is where the money is!
Tagg admits that cheap voice is not as much a lure in the U.S., but in Europe and the rest of the world where per-call rates are pretty high, it can be quite an enticement for customers. “Out-of- network calls in the U.K. can cost you 25 cents a minute, so if you can bring it down, you are an attractive proposition for consumers,” says Tagg.
Wi-Fi-based voice is a good option, he argues, because it is cheap enough and allows people to talk a lot. “People like to talk a lot when it is cheap enough,” he says. In other words, the voice hills might look barren, but there are still spigots of gold if you look hard enough.
But problems with this model could arise if Truphone has success to the point where people can make Truphone-to-Truphone calls for free — a dash of investment irrationality we’ve talked about before. Still, the company has a long way to go before it can turn into a major force – it has just a few thousand customers at present.
The good news is that an increasing number of mobile phones will have Wi-Fi built in. Broadcom and Texas Instruments have recently introduced Wi-Fi chips that are optimized for mobile handsets that are more powerful and consume less battery power – a constant complaint with the dual mode handsets. ABI Research is particularly bullish, seeing shipments of more than 300 million dual-mode cellular/Wi-Fi phones by 2011.
When asked if he is going to offer Truphone over 3G, Tagg replied that it is something the company has considered. “We are not offering it at present because there is a lot of confusion about the 3G data tariffs, and we don’t want our customers getting stuck with big bills,” says Tagg. The Bill Shock, he says can prove to be counter-productive for Truphone.
The company also added interoperability for Google Talk today. Essentially Truphone users show up as “contacts” on Google Talk and one can converse with each other for free.
‘On-net’ Truphone users show as ‘online’ in Google Talk, enabling people to know exactly when they can make a free call. Calls between Google Talk and Truphone are free because they are pure VoIP calls and take place entirely over the internet. Communication between Google’s servers and Truphone’s servers is via the standard XMPP protocol. (From Press Release)
Increasingly, it seems that the race is between Gizmo and Truphone for mobile VoIP mindshare. When we asked Tagg about his competitors like Gizmo Project, he retorted that they are good competitors and they are all going after the incumbents. “Vodafone has 200 million customers, and instead of competing with each other, we will be competing with them,” he says.
Tagg is pretty hopeful about his company’s prospects going forward, especially with the increasing number of smart phones shipping to the market. With smart phones growing rapidly — up to almost 35 million over the past year, a growth rate of 75 percent, according to Gartner — Truphone could get a little more traction as more handsets can handle the new applications.
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Written by Om Malik on February 8th, 2007 with no comments.
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MySpace’s mobile ambitions are moving across the pond and landing on Vodafone cell phones. The deal makes sense to the companies — Vodafone has been trying to boost its mobile data revenues, and MySpace needs a strong partner to get traction in Europe.
The MySpace application for Vodafone will be similar to the one used by Cingular “with a few specifics at the back end to fit the network’s requirements,” says a MySpace spokesperson. I’ve been playing around with the Cingular MySpace app for a few months, and despite the fact that I really don’t want to pay $2.99 per month to use it, the application itself is pretty rich.
Vodafone didn’t disclose the pricing of its MySpace service, but the companies gave some details, like it will be available first in the U.K., pre-loaded on some Vodafone handsets and will also be available for download from Vodafone live. Maybe Vodafone will be smart and make it free, which could be a good way to boost data usage.
If you hate paying for Internet services that are free on your PC but cost on your phone, like I do, you should check out VCEL, a free service that has a MySpace mobile java application and a WAP site. I chatted over email recently with VCEL creater Sergey Lossev, a student on leave from UC Santa Barbara, whose MySpace page says he’s 21.
Lossev doesn’t think consumers should have to pay for MySpace mobile either, and had some smart stuff to say about the difficult value chain for mobile content:
We disagree with the current MNO/OEM/app provider value chain that results in Carriers dictating/choking innovation by the little guys, and always ends up premium charging the end user. Since day one we set out to prove that other bus[inesss] models are possible, models where needed services are free to the end users and supported by mobile ads (we are the internet generation kids that grew up with ads all over the internet for as long as we can remember).
Amen. All VCEL needs is a little more design work and some promotion to bring in users. The options aren’t as slick as the application for Cingular and soon Vodafone — but how can you pass up free?
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Written by Katie Fehrenbacher on February 8th, 2007 with no comments.
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Now that mobile WiMAX is starting to get some significant backing from interested carriers like Sprint Nextel, investment in mobile WiMAX hardware and chips is following suit. Last week it was Aperto Networks, this week it’s mobile WiMAX chip provider Beceem Communications, which says it’s raised $40 million in a Series D round, led by Teachers’ Private Capital and joined by NEC Corporation.
This latest round brings Santa Clara-based Beceem’s total funding to almost $100 million, and the startup has a long list of high profile investors that also participated in this round, including: Global Catalyst Partners, Intel Capital, Khosla Ventures, KTB Ventures, Mitsui & Co. Technology Investment Group, DoCoMo Capital, Samsung Ventures, Sequoia Capital, and Walden International.
Mobile WiMAX gear and chip companies are raising a lot of money fast as carriers like Sprint are just starting to make decisions about what equipment to buy for their new networks. Aperto, which only started adapting its hardware to include mobile WiMAX last October, has raised $139 million.
Sprint has named big public companies Motorola, Samsung, Intel, and Nokia as infrastructure and device partners, though we’re not sure whose silicon will be involved in which products. So far, Motorola has invested in mobile WiMAX chip company Sequans, Samsung Ventures and Intel Capital invested in Beceem, and Samsung and Intel also have their own mobile WiMAX silicon ambitions, as well.
Infrastructure startups and chip providers who don’t get their hardware in these big carrier deals will feel the pinch to raise even more, to try to ensure they get a part of other significant deals to come.
From the operators, to the chip makers to the gear providers, the entire mobile WiMAX ecosystem is in spending mode right now. Sales of WiMAX equipment are estimated to top $3 billion by 2010, says research firm Instat.
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Written by Katie Fehrenbacher on February 8th, 2007 with no comments.
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Helio, the MVNO backed by $440 million from Earthlink and South Korean mobile company SK Telecom, is finally ready to give some subscriber numbers. Because the company is backed by public companies, the announcement is partly as a result of the fact that Earthlink is reporting its earnings tomorrow.
The Los Angeles-based company says it had signed up approximately 70,000 subscribers by the end of 2006 and projects that it will surpass 100,000 users by early in the second quarter of 2007. Launched at the beginning of May 2006, that gives them roughly a year to reach the 100,000 mark. While the service could grow faster over the coming months and years, at a 100K-subscriber per year growth rate the company would reach 300,000 subscribers by May 2009. Now didn’t CEO Sky Dayton once say Helio will have three million subscribers by 2009.
Those subscriber numbers aren’t astoundingly high, considering the investment behind the service, but they are tracking the other venture-backed competitor Amp’d Mobile. Amp’d officially launched in mid-December 2005 and claims that at the end of 2006 it had over 100,000 subscribers.
Helio’s average revenue per user numbers are nothing to scoff at, though, bringing in over $100 per user with an estimated 25% coming in from data services. The company has been rolling out data services, and is also announcing an over-the-air mobile music download service tomorrow. Dayton says the company ended 2006 with an annual revenue run rate in excess of $100 million.
Amp’d said in January that its ARPU was “well over $100/month” as well. Its average revenue from content and data was $30 per month. In other words the two high-end MVNOs are reporting similar numbers.
Dayton wouldn’t say how much the company had spent on marketing so far, though it’s well known that the company has $440 million in backing. Amp’d on the other hand raised $260 million in venture funding and last I heard spent somewhere between $200 million and $300 million just getting the service launched. It’s hard to tell how much either company has spent or will spend bringing in more subscribers. But its safe to say, a whole heck of a lot.
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Written by Katie Fehrenbacher on February 6th, 2007 with no comments.
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Palo Alto Daily News reports that the two Bay Area cities are close to signing off on trial zones for their MuniFi efforts. Brian Moura, assistant city manager of San Carlos told the newspaper that two “one-square-mile testing spots in Palo Alto and San Carlos may be ready as soon as late February.” Each square mile would have between 35-to-40 access points that would be installed on street poles for four month trial period. This trial is part of the big Wireless Silicon Valley initiative.
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Written by Om Malik on February 4th, 2007 with no comments.
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The first DEMO convention of the year starts Tuesday night down in the So Cali desert, where 68 startups will try to get noticed by the 700 or so expected press, VCs, and industry execs. For every Skype or Ironport that have launched products at the show, there’s hundreds of Browsters or Filmloops that make up most of the flock. We’ll try to make some educated guesses, though lively presenters and good business plans often have an inverse relationship.
A quick look at the math: say there’s 600 paying attendees at an average $2,250 per person fee, and 68 demonstrators pay $18,500 a pop, means Chris Shipley’s show could be raking in more than $2.5 million for the event before expenses. Cha-ching in Palm Desert!
According to DEMO rules what the companies will launch at the show is embargoed until tomorrow, but since the presenter list is public, we thought we’d take a quick look at some of the attendees pre-announcement day.
Personal publishing across media: Dublin, Ohio-based Nextumi will be there and one of the cofounders says the company will launch “share2me, a ubiquitous sharing product to permit crossplatform, multimedia sharing.” Redwood City, CA-based Vuvox says it enables its users to publish personal channels with digital content, with the tagline ‘your visual voice.’
Startup product I already use regularly: TeleFlip. Easiest way to send a text message from your PC to a cellphone, just send an email to ‘PHONE-NUMBER’@telefip.com. I have no idea how they’re going to make money, but I love this service.
Online video: With all the online video startups out there, there’s still even more launching or unveiling new products at DEMO, like Magnify.net, Eyejot, Blinkx, SplashCast, ClipSyndicate, Jaman, and Panjea. Details from Liz on NewTeeVee tomorrow.
Mobile: I’ve skipped DEMO the past few times as Web 2.0 washed over the place, but more and more startups are outlining mobile ambitions there. Bling Software says it has the industry’s only AJAX based client for mobile applications, Buz interactive does a mobile personalization service (more details tomorrow), and a launch from Mobio, a company we covered last year.
WiFi Aid: The WiFi at DEMO will probably be too impacted to work, but a few companies are betting on the ubiquitous WiFi trend. We’ve checked out Devicescape’s download, which helps with browserless access to WiFi networks. Spanish startup Whisher, which has the tagline ‘WiFi Reloaded’ opened and then locked its beta site already.
Established companies trying for some DEMO juice: Adobe, Alcatel-Lucent Ventures, Seagate, Symantec, Wyse - hey there old timers.
Worst named DEMO companies: Boorah — boo. Jaman, say it with a rasta accent — now it’s pretty bad right. Buz Interactive and Me.dium — maybe the lack of the domain name of choice (Buzz Interactive? Medium?) means they lose out on the moniker of choice (pure speculation). Oh well, names aren’t the end of the world.
Most of these companies, like the Kleiner Perkins Caulfied & Byers-backed content recommendation site Aggregate Knowledge have raised money in the past 18 months. Many are also using DEMO as a venue to look for another round of funding. Which ones do you think are worth investing in?
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Written by Katie Fehrenbacher on January 30th, 2007 with no comments.
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What kind of a deal with the devil has Cingular done to get at the hottest mobile phone in the business?
Verizon Wireless now says they walked away from the iPhone deal nearly two years ago largely because of Apple’s high financial demands and control of retail distribution and device support. Jim Gerace, a Verizon Wireless vice president tells USA Today plainly “We said no.” Verizon Wireless spokesperson Jeffrey Nelson tells us:
“We were extremely concerned that Apple’s tight grip would mean that our great distribution partners - WalMart, Best Buy, BJ’s Wholesale - would be left out of the equation. And we weren’t going to let that happen.”
Right, can’t forget BJ’s!
This makes it look like Steve Jobs iPhone strategy will follow the Apple’s standard retail model more closely, avoiding the average electronics store and concentrating on sales and support out of the Apple digs.
We’re wondering what Verizon had more of a problem with - the retail outlets, or the reported cut of the monthly subscriber fees? According to our sources Verizon Wireless was also in serious exploratory talks over an MVNO with Apple. Well that clearly didn’t go anywhere.
Regardless, it’s clear that Jobs had been negotiating with the country’s two largest wireless carriers for a few years. What we wouldn’t give to learn more about the details of the Apple’s Cingular deal — will the largest mobile deal of the year end up being a smart deal for the nation’s largest carrier?
Photo by Niall Kennedy via Flickr
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Written by Katie Fehrenbacher on January 30th, 2007 with no comments.
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The modern mobile phone business gives the phrase, between a rock and a hard place, a brand new meaning.
The demand for cell phones has never been higher, thanks to the demand for voice and text message services in emerging economies around the world. India, China, Brazil, and Africa – everywhere you look, citizens are clamoring to talk on their mobiles. They don’t want expensive $500 iPhones – they want a handset that is good for SMS, voice, and maybe a few other basic features.
A report from ABI research says that “by 2011, almost one out of every four handsets shipped globally will be an ultra low cost handset [less than $20].” The math isn’t hard — more cell phones sold at lower costs means less profits. Unless of course the volumes make-up for lost margins, a tactic that so far hasn’t worked for many handset makers.
Motorola’s downer Friday — with job cut news and profit declines — is an increasingly frequent scenario for the mobile phone industry. It is not alone. Nokia has been through this – the company’s third quarter earnings were down compared to the same quarter the previous year, “because a greater portion of its sales came from low-cost handsets,” says ABI.
Later this week Nokia will report fourth quarter and full year earnings, and we’ll see if the world’s largest phone manufacturer fared any better than its rival. According to AFP, quoting from a 48-analyst survey, Nokia is expected to buck the declining earnings trend with a modest 4.4% jump in pre-tax profits for the quarter, but will see operating margins at 14.9% — down from 17.1 percent in the fourth quarter of 2005, though up from 13.1 percent in July-September 2006.
Analyst expectation for Nokia’s average selling price of mobile phones is also still dropping: “91.40 euros, down from 99 euros a year earlier and from 93 euros in the third quarter of 2006.” The low cost handsets are showing their true colors for Nokia as well.
While Motorola and Nokia are the biggest players in the low cost handset market, ABI points out that LG, BenQ, Samsung, Philips, Ningbo Bird, Haier, and Kyocera have also started to introduce handsets for this segment. This means more price competition, and ever further decline in margins.
Nokia, Motorola and others don’t have much of a choice. They have to show growth, retain market share or else take a beating on the stock markets.
As we were saying, between rock and a hard place….
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Written by Katie Fehrenbacher on January 24th, 2007 with no comments.
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Craig Settles, a consultant who studies all things MuniFi, sent out a report last night that says public access of city-wide Wi-Fi networks “will be widely viewed as financially the weakest pillar in the business case for municipal wireless,” by the end of 2007. Instead, mobile workforce applications will be “muni networks’ big ROI generator.”
You didn’t have to tell us that public use of MuniFi networks isn’t likely to be the saving grace it’s often painted as, and carries some real business concerns. The more we test out and examine city-wide Wi-Fi deployments like Milpitas and Mountain View, the more we are starting to realize that resident use based on a $20 plus subscription, might end up being pretty limited. Free services will likely be used more frequently, but the ad-based revenue model for free service is also so far unproven.
What we are starting to realize is that MuniFi isn’t a very attractive replacement for DSL or cable service, as use within homes isn’t always guaranteed, particularly without extra hardware. In San Francisco, EarthLink says a third of the households could need additional hardware ($50 to $100) that pulls in the Wi-Fi signal. When we previously reported on Google’s Mountain View network, the company had said that it is unlikely that a Wi-Fi-enabled laptop or computer with a conventional Wi-Fi card will work indoors at most locations — ie, extra hardware is needed.
For a free service, like in Mountain View and Portland, residents are more likely to use the service, even with some spotty connections. But in a city like San Francisco, (if the deal is approved,) EarthLink’s 1Mbps service will be offered for $21 per month to most residents.
If I lived in San Francisco I’d likely choose any of the other options over that choice — Google’s 300 kbps for free, $15 to $20 for comparable speeds with DSL, or cable’s more expensive but often faster options.
Settles says: “Public wireless access is good political sound-bite marketing, but the beef is mighty hard to round up.” We’re not sure how much of EarthLink’s profits are based on those $21 subscriptions, but given EarthLink is looking for revenues, not running for office, that could be its business model’s biggest concern.
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Written by Katie Fehrenbacher on January 23rd, 2007 with no comments.
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As Ed Zander outlined his vision of a mobile world at CES recently, he of course avoided to talk about some of the harder trends the industry will face this year — the rapid decline in the average cell phone prices due to both global competition and consumers in emerging markets like India and China favoring cheap phones. Today that caught up with the company, which reported that its fourth-quarter profit fell 48 percent and the company will cut 3,500 jobs, as it looks to improve operating costs.
Motorola’s handset business’ profit margins declined to 4.4% in the fourth quarter of 2006 versus 12% in the third quarter of 2006 — “That’s well shy of Zander’s aim of 13 percent to 15 percent, a goal he has failed to meet since taking over in 2004,” reports Bloomberg. Zander clearly is willing to sacrifice margins for market share. According to their earnings release, Motorola’s share of global handset market is now at 22.2 percent, up 4.3 percentage points versus 2005.
But cheap phones are not the only reason Motorola finds itself in a tough spot. A couple of days ago, Microsoft CEO Steve Ballmer was talking about how you can buy Motorola Q for $99. Ouch - wasn’t that supposed to be their big Blackberry killer and a profit machine? The company has been milking the RAZR design for a while, and hasn’t really come out with phones that can be labeled “smash hits.” Samsung, LG, Sharp and even Nokia have caught up with Motorola when it comes to “thin” phones.
Lazard Capital Markets analyst Christin Armacost, Director and Telecommunications Analyst has an equally gloomy outlook: “In our opinion, Motorola has a lot on its plate and is in one of its more challenging periods in recent memory, as we believe the competitive dynamics will weigh more on the company’s financial structure than will internal costs and processes that the company can control.”
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Written by Katie Fehrenbacher on January 20th, 2007 with no comments.
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Didn’t take too long for AT&T to start showing why it’s good to be big: You can use your own network to clobber competitors in the pricing game. Friday morning’s salvo is an offer of free, unlimited in-network calls between Cingular (excuse me, AT&T Wireless!) cellular and AT&T landline accounts.
According to the AP story, the service covers about 100 million numbers, which are phones held by users who are suddenly saving money without doing a damn thing. Sounds like that iPhone just got a lot cheaper, one more excuse for Om to indulge himself come June. And VoIP providers who thought they could win by underpricing the incumbents? Welcome to round two.
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Written by Paul Kapustka on January 19th, 2007 with no comments.
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Apple Inc. is having a bad day after a spectacular evening when it reported a blowout financial performance. Sold more iPods (21 million), and Macs, banked billions in cash and what not. However, like all of us who have had a bottle of wine (or two), they are waking up with a hangover. The outlook for the second quarter of fiscal 2007 isn’t so rosy, and as a result the stock is down almost 4 percent, and still heading south.
I think Apple is experiencing the down side of over-hyping. By announcing iPhone at the Macworld, the company has put purchasing decisions on hold for millions who were in the market for a high-end iPod. There might be little risk to the lower-end iPod Shuffles and Nanos, but the big profit-making high-end iPods might be at risk.
“We believe this [seasonal] risk is particularly pronounced given our concerns that some consumers may delay iPod purchases ahead of the iPhone lauch,” Bill Shope of J.P. Morgan wrote in a research note to his clients.
The iPhone could pose a bigger challenge to not just Apple but to other handset makers as well. A lot of non-geeks, non Mac fan-boys have emailed or called us, gushing about the iPhone and are willing to wait for the device before buying their next device — an Mp3 player or a mobile phone. Could it prove to be a collective “oops” for the tech business as the “Apple Shock” ripples through the entire ecosystem?
It is also interesting to note that Apple did not announce a single product at Macworld that was available instantly and could add some zip to the Apple revenue stream. Apple TV and Apple Airport are not available till next month. Both are expected to do well, but will they be the two “advils” you need to cure the hangover?
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Written by Om Malik on January 19th, 2007 with no comments.
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Sprint’s WiMAX investment is one of the most exciting drivers behind the mobile Internet this year. But whether or not Sprint will embrace the open model of the Internet or the traditionally closed way of the phone companies when it comes to its first WiMAX devices is still up for debate within the company — or so said Atish Gude, Sprint’s senior VP of mobile broadband operations, at a wireless conference on Wednesday.
Gude said that while Sprint eventually wants to embrace the open Internet-centric model for devices that connect to its WiMAX network — browseable devices and open platforms — the company is still wrestling with whether it should lean toward a closed or open model when it launches. “Do you start with an open model, or start with a closed model and move to an open model,” he asked. (Don’t ask consumers, that would be too easy.)
For example, Gude wondered whether the open Internet and browsing is necessarily the best service for WiMAX-connected dedicated devices like a camera or a gaming device with no keyboards. Gude seemed to think it was in the consumer’s best interest to take baby steps with a closed model and then slowly open it up. Yuck.
While companies that make consumer electronics like Sony (PSP), and Microsoft (Zune) have been going over this connected devices debate for awhile, it’s funny that U.S. phone companies are just starting to hash out these issues. I guess the carrier’s answer has been so obvious when it comes to mobile devices and the Internet, that it takes WiMAX to start up the conversation again.
Gude said a few other interesting things like how the consumer might pay for its WiMAX service: “An individual customer can have a subscription for multiple devices. . . ‘X’ number of devices. . .say an Internet connection is $30 or $40, then we think there will be a mobility premium of $10 or $15. We’re still figuring it out.”
On the topic of VoIP, Gude says, “In the Internet world VoIP is an application. . . we will be deploying VoIP as a service of our WiMAX network, but a dedicated standalone device? — the point is not to go back to the [voice-only] cellular network.”
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Written by Katie Fehrenbacher on January 18th, 2007 with no comments.
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After we crawled out from under the CES/iPhone news pile last week, we took another look at Sprint Nextel’s update on WiMAX and its new guidance. We knew the news wasn’t too good, projecting that the company will cut 5,000 jobs, but we thought that the company might have lowered some of its WiMAX spending as well. Interestingly enough, Sprint is actually spending a bit more on WiMAX in 2007 than it had previously projected.
Sprint projects it will spend a total of $1.1 billion on WiMAX in 2007, “$300 million of start-up operating costs associated with WiMAX 4G broadband services,” and $800 million on WiMAX capital expenditures this year, according to the latest update. In the original release the company said “Sprint Nextel is expecting to invest $1 billion in 2007 and between $1.5 billion and $2 billion in 2008 relating to the 4G mobile broadband network.”
When I asked a Sprint spokesperson, “Isn’t that actually more than originally projected,” the spokesperson said, “Yes. But to be frank I think most interpreted the original release to read as capex instead of both.”
Splitting up the costs is a nice way to make the company look like they’re spending less on WiMAX, though, in case Wall Street was worried about that. Perhaps this means the company will end up spending over its $3 billion outside figure on the network.
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Written by Katie Fehrenbacher on January 16th, 2007 with no comments.
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Steve Jobs is a great storyteller. If he were a fiction writer, he would stand shoulder to shoulder with the likes of Tom Clancy and John Grisham. Mesmerizing in prose, master of the climax.
Today’s performance at the Macworld Keynote was no different. We hyper clicked, reloaded websites and traded SMS messages trying to find out more details about new iPhone, the real thing, not the poser that came to market a little while ago.
And how he teased us, taking two hours to let us know that it will be available in June 2007. And even though it is going to cost an ungodly amount, there is a good chance we might get one. But that is not the real story of the day. The real story of the day came at the very end of his keynote.
“From this day forward we’re going to be known as Apple, Inc. We’ve dropped the computer from our name.” And then he quoted ice skating legend Wayne Gretzky. “‘I skate to where the puck is going to be, not to where it’s been.’ That’s what we try to do at Apple.”
That also might be the epitaph of the PC era. And it is sweet irony that the company that sparked off the desktop computing revolution is the one announcing its passing.
Dropping Computer from its name is a sure sign that Apple, from this point forward, is a consumer electronics company, a mobile handset maker - one that also makes computer hardware and software as well.
Like the iPod, the iPhone may feed off the computer, but it can leave peacefully without any dependence on a desktop. A Wi-Fi enabled device, it is should ideally be capable enough to do direct downloads from the iTunes store, no desktop necessary. (Time magazine says it is not possible, so who knows!)
Apple is making the phone do all things a computer does – surf, email, browse, iChat, music and watch videos. Nary a keyboard or mouse in sight, and everything running on OS-X.
While I am not suggesting that this replaces our notebooks or desktops for crucial productivity tasks, the iPhone (if it lives up to its hype) is at least going to decrease our dependence on it.
Quotes via Engadget. Photos by Niall Kennedy via Flickr.
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Written by Om Malik on January 10th, 2007 with no comments.
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The trials and tribulations of the competitive voice service provides such as Vonage, have forced venture investors to look at startups that marry VoIP to mobile phones. Any application that can lower the high mobile phone tariffs can quickly gain traction. And that is enough for investors, who ready to put down mega dollars.
You might have heard of names like Jajah, iSkoot, Mobiboo and Fring, with some of them getting big cash infusions from the likes of Sequoia Capital and Khosla Ventures. Add Truphone to this list. The UK-based mobile VoIP startup has raised £12.5 million ($24.5 million) in Series A funding from Wellington Partners, Independent News & Media, Burda Digital Ventures and existing investors Eden Ventures and angel investors.
The company plans to set up what it describes as a global Mobile Internet Network Operator. The company has signed up deals with Wi-Fi network operator The Cloud, which lends some credence to its claim.
Much as I like Truphone the application, I find the company has an uphill climb. The fancy MINO acronym might sound impressive but in reality Truphone will be fighting the battle for cheap minutes, which is great in early days but then it quickly gets old.
The only reason I use them is because the calls are cheap, cheap enough to make me wonder what really is the margin for Truphone after it has paid off the incumbent who terminates my call in India.
With multiple phones to support, one cannot overlook the problems and costs involved with developing and deploying software to many different mobile platforms. This at a time where there are competitors popping up all around them. Of course, what is to prevent the Vonages of the world to play the same game?
Here is the twister: if Truphone becomes really popular and is embedded in all phones, then you can make free calls to other Truphone-enabled phones. In other words no revenue opportunity, just like Skype. Forgive me for thinking, that this investment is laced with a dash of irrationality.
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Written by Om Malik on January 10th, 2007 with no comments.
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If you are a Sprint Nextel customer, at some point you have suffered from dropped calls. It seems that malaise is spreading to the service provider itself, which has hit a massive air pocket. The company today gave a guidance that could make anyone cringe. The news was so bad, that the company had to cut 5,000 jobs. Quick recap of the bad news:
- In the fourth quarter ending December 31,2006, Sprint Nextel lost post-paid 306,000 subscribers, the only metric that counts amongst the Wall Street types. Analysts had estimated a loss of about 250,000 subscribers to defect to other carriers. UBS estimates another 330,000 will be gone in the first quarter of 2007 and expect these losses to continue.
- The capital expenditures are going to be up in 2007 to $8.5 billion versus a shade over $7 billion in 2007.
- The company will spend $300 million on WiMAX in 2007, and more in 2008. No idea, how much, though they did promise coverage for 100 million possible customers by then. Chicago and Washington DC will be their first two trial markets for WiMAX.
- 2007 revenues are going to be flat when compared to 2006, remaining in the $41-t0-$42 billion range.
- The good news is that a lot of that money is going to be spent on 4,800 new cell sites, which will raise the total number of Sprint cell sites to 67,000, which compares favorably to 45,000 for Cingular and 26,000 for Verizon.
- The company is planning a new CDMA based product for Boost customers that uses CDMA network and offers unlimited calling.
The company lost more than expected post-paid customers in the fourth quarter of 2006; will spend more money and will have a flat 2007 in terms of revenues - that’s a left-right-left combination that could leave any investor KO’d. Sprint should count its blessings that all busy bodies, aka bloggers and reporters, are in Las Vegas attending the CES.
In many ways you could predict that this was coming. In Septmeber 2006, Sprint COO Len Lauer quit the company. A month later Tim Donahue left the building. While trying to predict the future because of these developments was akin to reading tea leaves, still two senior executives leaving in quick succession is always a red flag.
Beyond the numbers, Sprint-Nextel’s problems stem from their dual network strategy - CDMA and iDEN. CDMA is doing fine, iDEN is a mess and causing customers to cancel and switch to other carriers. And Sprint-Nextel will remain a mess up until a point when its one network. And if that was not enough, Sprint-Nextel’s decision to add yet another networking protocol, WiMAX, to the mix is only going to create bigger headaches for the company. In a note to his clients, UBS analyst John Hodulik writes, “We believe the company remains committed to WiMAX but is re-evaluating its projections on the project.” Re-evaluating to slowdown, would be a good move at this time.
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Written by Om Malik on January 9th, 2007 with no comments.
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The madhouse that is the opening day of CES is over and one thing is clear – CES has become more and more about mobile devices. Yeah, it’s always been a well tread topic at the show, but as faster and bigger wireless networks come online and the always-on mobile broadband connection becomes a reality, the main events and gadgets across the CES show floor are following suit.
Gates pushed the point last night, and the two morning keynotes on the first day were from the chiefs of the world’s largest mobile phone makers, Nokia’s Olli-Pekka Kallasvuo and Motorola’s Ed Zander (check out our latest Flickr photos).
Zander and Kallasvuo both dished a flow of new devices and services from the companies. The ra-ra fest is just what the companies need to help them forget about some of the clouds that have appeared in the mobile phone market — slower than desired growth in matured markets where sales are replacement phones, while emerging markets are growing well but buying up cheap phones.
Zander used the morning to talk about how Motorola would help consumers take their music and media with them wherever they are through the company’s mobile phones and digital living room devices. “Content moves with you,” he said and tried to illustrate the point by riding around the stage on a yellow bike decked out with a mobile charger. Later he demoed the company’s place shifting FollowMeTV technology, which allows users to view video, pictures and music in the living room on devices like digital cable receivers and on mobile phones.
On the music front Zander announced a partnership with Warner Music for the company’s mobile service and showed off the MOTORIZR Z6, a Linux-based music phone. Like Nokia did earlier this year, Motorola is pushing a music platform with both services and devices, and betting music will help sell its gear.
Kallasuvuo’s keynote was up second and on a slightly smaller stage at the Hilton, but filled with some sweeter devices. The company has been focusing on converged devices and recasting its phones as multimedia mobile computers for awhile, and today showed more of this plan. Kallasuvuo displayed the N93i video phone, an upgrade to the N93 we’ve been playing with, but the new one has Six Apart’s blogging service Vox integrated. Kallasuvuo said on mobile blogging and Web 2.0, “It’s the mobile device that will become the main way for people to participate in those communities.”
Kallasuvuo also showed off the N76, an eye candy slim phone, which he called “truly beautiful,” and the next version of its Wi-Fi-based Internet tablet the N800, which we can’t wait to check out. He mentioned that Nokia and Skype will develop a mobile Skype experience over the N800. He also showed a near-field communication mobile payment phone, the 6131, which Nokia is using in trials in New York. Whew – that’s quite a line up.
The companies are both hoping that all the flashy new phones and services announced this morning will help bring them the pickup they’ve been needing. Last week Motorola said its fourth quarter sales and earnings would be lower than it had previously forecast after slower sales of phones. That sent Moto’s shares down the most in more than four years (according to Bloomberg) and took Nokia stock in its down draft. Nokia’s third quarter earnings fell a bit while its sales rose, partly due to a drop in average phones prices, from a growing demand for cheap phones in countries like India.
Don’t get me wrong, sales of mobile phones are growing every year, and totaled 251 million units sold in the third quarter of 2006, according to Gartner — that’s a 21.5 percent increase from the same period last year. But the companies are in a bit of a bind. Matured mobile markets like many European countries, Japan and Korea and the U.S. are mostly buying replacement phones — a harder place to get growth. Emerging mobile markets like India and China are buying up phones quickly but it’s largely low cost handsets.
It’s a squeeze that the companies hope can partly be overcome by fancy handsets with features for music, the web, and video, among other things, that will convince consumers who already own a phone to get a new one. That’s one of the reasons why we get all these nifty new phones and services at CES every year.
Photos via Flickr
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Written by Katie Fehrenbacher on January 9th, 2007 with no comments.
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CES 2007, Las Vegas: First Modeo gave us details of its mobile TV launch at CES, then Samsung said it is working on its own mobile TV technology, now reports are saying Verizon Wireless and Qualcomm will announce the launch of MediaFLO mobile TV for Verizon mobile subscribers. We speculated as much, but whoa, talk about mobile TV overload — not even a day in Vegas and we’re already tired of the subject.
Then there’s the mobile TV over WiMAX demonstration that Sprint, MobiTV, Intel, Samsung, and Motorola will be putting on. And Cingular has its own mobile video thing going on with its “live” video share call announcement — they’ll be showing off a service where callers can share a live video stream to a recipient during a voice call. Well that covers all the major U.S. carriers, but seriously, all this mobile video is making my head hurt.
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Written by Katie Fehrenbacher on January 7th, 2007 with no comments.
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It’s been a long time coming but Earthlink just emailed us to say it has reached an agreement with San Francisco over the terms of the contract for the city-wide WiFi deal. Now all those vocal local critics can renew their protesting. It’s not quite the end of the line for Earthlink, though, as the deal has to be approved by the San Francisco Board of Supervisors. Hopefully that won’t take too long and the company can start building the network this year. We don’t know much of the details at this hour on a Friday, but we’ll bring you more as we know more.
(Disclosure: Earthlink is an advertiser on the GigaOM network.)
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Written by Katie Fehrenbacher on January 6th, 2007 with no comments.
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As if there weren’t enough mobile TV standards waiting in the wings, Samsung is planning to announce another mobile TV broadcast technology at CES called Advanced-Vestigial Side-Band, that will use digital signals from local TV broadcasters. The Wall Street Journal has some details, and Samsung PR tells us it will offer more info at the Samsung press conference on Sunday at CES:
For the technology to work, broadcasters will need to transmit separate beams to portable devices equipped with a Samsung chipset. . . The channel lineup could either be the same as local broadcasters are transmitting or special-tailored programming. — WSJ
We pointed out these other four ways that are being cooked up to offer mobile TV, and pointed out Modeo’s beta launch yesterday, which it will also announce at CES. Qualcomm is also supposed to get its MediaFLO mobile TV service up and running any day now. So many options and so much money put into a largely unproven technology.
Samsung already has phones for the mobile TV standards DVB-H, DMB and MediaFLO. With Samsung deciding to offer yet another way to get mobile TV, it seems like a good sign that the mobile TV broadcast standards battle is still largely up for grabs.
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Written by Katie Fehrenbacher on January 5th, 2007 with no comments.
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So what if most U.S. carriers won’t touch Google, the king-maker is doing a mobile search deal with the world’s largest wireless carrier, China Mobile. Google will provide its search engine technology for China Mobile’s WAP portal. The partnership has been rumored for weeks, but was officially announced today, and the companies’ say it will be widely available in early 2007.
Google has been signing up deals across Asia for mobile search, and has teamed up South Korean SK Telecom, and Japanese carriers NTT DoCoMo, and KDDI. In Europe Google has partnered with Telefonica, Vodafone and T-Mobile EU. In the U.S. Leap Wireless has been one of the first to warm up to Google’s mobile search. A lot of the carrier deals have been with smaller, early-adopters, but China Mobile’s hundreds of millions of subscribers is a significant win.
Lack of U.S. carriers deals isn’t doing too much damage to Google’s mobile search in the U.S., with about half of U.S. users turning to Google. M:Metrics says out of the 10 million plus subscribers who tried out mobile search in the U.S, Google was used by 5.25 million users. Yahoo had around 4 million users. Our readers experienced the same. Over half of our readers said they use Google for mobile search in our recent poll.
In Korea and Japan, typically hard markets to break into, the carrier deals are key — It’s the same with China. The China Mobile deal is also important because mobile subscribers in China seem to be more accepting of mobile advertisement, or so says the Wall Street Journal this morning, and the mobile is often a better way to reach audiences than PCs. Thanks to China Mobile Google’s mobile search just got in front of a lot more eyeballs.
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Written by Katie Fehrenbacher on January 5th, 2007 with no comments.
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EXCLUSIVE
Modeo, the mobile TV company owned by Crown Castle, plans to announce on Monday that its service is live in New York city, in what the company is calling a ‘beta commercial launch.’
There’s a bit of hand waving involved, as the beta service is closed to the public and will be open only to a select group, which the company says will have several hundred users. The company had been shooting for an end of the year launch, but will now make the announcement at CES next week.
The service will launch with video and audio content, and Modeo said it will use the beta group to get feedback throughout the first quarter. The company still has no carrier deals to announce or a timeline for when (if?) the service will be available to the public and outside of New York. The beta group will be using the DVB-H HTC-manufactured smart phone, which it showed off last year — we’ll check out their demo at CES at the Microsoft partners booth.
The beta launch is good news for Modeo, as it can try to use this to get a carrier deal, and good for companies like Nokia that can finally show off DVB-H gear stateside on a live network. But a closed launch is rather underwhelming. I got the feeling that the next quarter will be Modeo’s make it or break it time. If the beta service goes well and deals follow, the company could survive. But, hey, let’s be realistic, the CEO just bailed, that’s not a good sign.
Especially since Qualcomm is planning on launching its MediaFLO mobile TV service in the first quarter of this year and has been besting Modeo on carrier deals. I wouldn’t be surprised if Qualcomm made a launch announcement at CES, too. Only they’ll probably have more details of when consumers can actually start buying the service.
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Written by Katie Fehrenbacher on January 4th, 2007 with no comments.
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Have you ever wondered why it is hard to get wireless networking right on alternative operating systems such as Linux and OpenBSD? It appears the blame for this situation lies with chip makers including the likes of Broadcom, Intel, Marvell and scores of other companies. These are the findings of Jem Matzan, who writes The Jem Report.
Matzan’s investigation shows that open source software coders are getting stymed by the chip makers. A major reason for the problems is that most companies are using proprietary firmware which cannot be redistributed, or has substantial restrictions.
Unrestricted redistribution of firmware files is satisfactory for some open source operating system projects like OpenBSD, FreeBSD, and many varieties of GNU/Linux, but others like Fedora Core and Debian demand an entirely free software environment, so redistribution of the firmware without the ability to modify and distribute the source code is prohibited.
Beyond that, the chip makers don’t provide documentation for their firmware, and as result it is really hard for programmers to write drivers for these wireless networking chips. The problem which essentially plagues wireless networking chips is now spreading to the wired variety as well, Matzan notes.
I am just offering a summary of what is an extremely thorough report including conversations with some chip company executives. Predictably, many of the majors dodged Matzan’s questions.
via Digg
Written by Om Malik on December 28th, 2006 with no comments.
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Television on the mobile is slowly becoming a big business in the U.S. Don’t ask us why people want to watch even more television on a tiny screen, but some do — there are at least 1 million subscribers watching what Emeryville, Calif.-based MobiTV has to offer.
MobiTV’s technology allows the company to send optimized video signals over wireless data networks, and has helped the company win over most of the large carriers. Mobile carriers who fight over pennies are happy to make a deal with MobiTV, just to get subscribers to use their data services. A mobile television customer can easily tack-on $10-a-month to the phone bill, and that is something no carrier can ignore.
In sharp contrast, you have the two mobile TV-only standards, MediaFLO and DVB-H, which are still waiting in the wings in the U.S.
There are several trials, and Qualcomm has managed to convince several U.S. carriers to test out its MediaFLO, but commercial deployments have not really materialized. I had written about this fourth-TV network back in 2005 with much enthusiasm, but the lack of progress is reading like a litany of broken promises. Qualcomm had predicted nationwide service in 2006 … we are still waiting. Modeo, which is wholly-owed by Crown Castle, a large owner of cellular towers, was supposed to launch its Mobile TV network that uses DVB-H before the end of the year.
I have my doubts about the launch, especially since CEO Michael Schueppert quit weeks before the network was supposed to go live. “If it pulls off its planned launch in New York in the next three weeks, it would beat its competitors Qualcomm and HiWire as the first multicast TV provider with commercial service,” writes Telephony magazine.
Schueppert recently told EE Times that the carriers were not all that engaged with mobile TV. (Or maybe just Modeo’s version.) Modeo needs to launch the network in order to generate some excitement around the technology and the product, and more than anything needs to win over a big carrier.
Modeo is said to be in dire need of fresh investment from new partners, private equity firms or venture capitalists, sources said. For the time being, Crown Castle is standing by Modeo for the New York service launch. But Crown Castle, whose core business is in managing cellular towers and tower sites, may not be interested in supporting Modeo over the long haul, sources said. (EETimes)
Verizon is working with Qualcomm and its MediaFLO technology, but one cannot expect any live deployments for another few months. Perhaps that is why we take any subscriber forecasts with a pound of salt. If Schueppert was speaking the truth, then the confusion only helps MobiTV. At least that explains why the California-based company has attracted $125 million in venture funding.
Written by Om Malik on December 13th, 2006 with no comments.
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For some odd reason I have never gotten around to writing about Sharpcast, a company that has gotten rave reviews from the traditional guys and the new new media barons. What Sharpcast does is sync all sorts of files between your phone and computers. Its like Sync-4-everything and doesn’t take much effort. Its like Blackberry for all your digital files. Anyway today I got my reason why I have not written about Sharpcast: lack of mac support for its brilliant photo syncing service. Well, that excuse is out of the window.
Sharpcast just launched an iPhoto uploader for Mac, which allows the click crazy to export iPhoto albums directly from their Macs into their Sharpcast Photos Web albums and are automatically synced all the way down to the person’s mobile phone and PC desktop. While you are at it, check out their Hummingbird technology.
Written by Om Malik on December 13th, 2006 with no comments.
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When we wrote about mobile search a few weeks ago, we weren’t surprised to see that the big online search brands like Google, Yahoo, MSN, and AOL were leading the list. But go2? — M:Metrics says the Irvine, CA-based startup has more than 450,000 users per month. We followed up with the CEO Lee Hancock, who said that the number is even higher at 1 million users per month.
How did go2 bring in that many mobile searchers in such a young market? Hancock says the site’s success relies on its early entrance back in 1999, which has enabled it to develop 70-plus targeted mobile WAP sites, like go2 Golf and go2 Movies, as well as gain good placement of its WAP sites on carrier menus.
Hancock also says that this early move has been both a blessing and a curse: “the good thing is we won the race, the bad thing is there wasn’t a prize at the end.” He’s referring to the fact that the company hit a wall in 2002 because the mobile ad and mobile web markets were nonexistent. That’s when the company under went a management buyout through an assets acquisition from the original company go2 Systems.
Four years later the company is doing better as mobile markets are growing. The company uses Third Screen Media for advertising, and has an auto-locate feature based on GPS. The company is still not profitable, though, and recently announced a financing round of $13 million from investors, including Canada’s Geosign Corp.
Go2 wants its carrier-friendly service to be a cell phone user’s first choice for any type of local, on-the-go searching. They’ve managed to bring in a significant amount of users, but that’s over a very long period of time. Unfortunately for go2 when it comes to mobile search, it’s really all about branding and Google has them beat hands down with over 5 million monthly users, after basically a modest amount of effort. As Hancock says himself “go2 is not a household name.”
Our recent mobile search poll says 50 percent of users choose Google for mobile search, and 29 percent are still scratching their heads over searching via a cell phone. go2 might have been the first to market, but go2 is also facing stormy weather, now that the major online brands are moving in faster. We’ll see how long the company can survive that onslaught.
Written by Katie Fehrenbacher on December 11th, 2006 with no comments.
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By Allan Leinwand
Mobile operators are on the verge of asking you to help them solve one of their biggest problems – how to get more signal strength where you need or want it most. Their plan? Allow end users to buy personal devices that act like Wi-Fi routers, providing nearby cellular bandwidth in hard-to-reach places like offices and homes.
These next type of cell sites, named femto cellular (femto being smaller than pico, the term used by mobile operators that refers to smaller cell sites) are setting out to solve carriers’ often-expensive problem of providing complete coverage. Mobile phones usually work well in metropolitan areas, but travel a few miles off the Interstate or into the country and signal bars drop rapidly. Most frustrating to many people is that the signal strength at their homes or inside offices is often unusable.
The forthcoming femto solution? Having end-users buy a small femto device, similar in concept to a Wi-Fi access point, that is a personal cellular site. The femto cellular device has a cellular antenna to boost the available signal as well as an Internet connection. The device uses your Internet connection to connect to your mobile provider’s’ network and route your phone calls.
There are a few limitations, or benefits, to this approach, depending how you see it. First of all, the femto device you buy will probably only connect to a single mobile provider’s network. That’s good if you like your mobile operator and bad if you want to switch operators on a regular basis. This approach is clearly good for the mobile operator because you buy a device that uses your Internet connection to extend their network and gives you less incentive to switch providers.
Since femto cellular devices are not available yet, there are some unknown issues – will mobile operators charge the same for minutes via femto cellular devices? Will enterprises buy femto cellular devices like Wi-Fi access points to extend cellular coverage? How do you stop your neighbors from using your femto cellular device and the associated broadband bandwidth (or do you care)? And how much are you willing to pay for a device that lets you use mobile phones in your house?
Allan Leinwand is a venture partner with Panorama Capital and founder of Vyatta. He was also the CTO of Digital Island.
Written by Guest Columnist on December 10th, 2006 with no comments.
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Today a GPS chip can fit in a cell phone and can cost as little as a dollar. Thirty years ago a GPS device cost tens of thousands of dollars, was bigger than a bread box (see picture) and was used only by the military. Bob Rennard, chief technology officer at mobile navigation company TeleNav, remembers those days. He was a principal engineer of GPS technology in the ’70s and earlier this week he regaled a fascinating story to me:
Rennard says when he was working on designing the original GPS system his team had three goals:
1) Be able to drop 5 bombs in the same hole during combat.
2) Make a GPS receiver that could be worn on a soldier’s back.
3) Make that device for under $20,000.
Wow. Well, 30 years later those goals look as dated as room-sized computers. At Santa Clara-based TeleNav, Rennard and TeleNav executives like CEO HP Jin are making GPS navigation services available on the average cell phone for about $10 per month. The company has been winning over carriers and handset makers and announced that it has added carrier Alltel Wireless this week.
We reviewed TeleNav’s service on a Sprint Katana Sanyo phone a few months ago, and found the service flawless while driving around the Bay Area. I even took it to remote Placerville in the Sierra foothills and it was accurate on backwoods rural roads. The only exception was driving in downtown San Francisco, where tall buildings confused the signal.
I also wanted a way to connect the audio driving directions to my speakers, so, say, I can play loud music and then be interrupted when there is an important direction. Without a service like that sometimes the audio directions were hard to hear. The Telenav execs say they are working on these types of features.
There are a few other companies selling into this market as well, like Networks in Motion, which is behind Verizon’s VZ Navigator, and Wave Market.
Sadly, such new navigation techniques are in greater focus after the recent tragic loss of James Kim. As GPS technology improves, maybe we will all be a little safer in the future.
Written by Katie Fehrenbacher on December 9th, 2006 with no comments.
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Mobile Linux is the hip thing to talk about this year — Motorola is making a big push, Garnett & Helfrich Capital is buying into the market, and Greenphone is trying for world domination. Now another startup that sells into the mobile Linux market, MontaVista Software, announced this week that the company has raised a sizable round of funding.
Santa Clara-based MontaVista says they’ve raised $21 million in funding led by Siemens Venture Capital, with other investors NEC, Alloy Ventures, US Venture Partners, and Aplix. The latest funding puts their total funds raised higher than $90 million, says Red Herring. MontaVista sells Linux-based operating systems and development tools for cell phones and mobile devices, as well as telecom infrastructure.
Using Linux for mobile phones and devices is a growing trend as handset makers like Motorola look for options outside of Symbian and Microsoft. Motorola says it can also use Linux to bring down development costs, shorten time to market, and tap the innovation of those savvy Linux developers.
Written by Katie Fehrenbacher on December 8th, 2006 with no comments.
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This week we’ve been mourning the loss of YouTube content on TinyTube’s mobile site, and thinking how much of a bully YouTube has become, given YouTube is built on user-generated content and copyright infringements. To see if this meant the end of TinyTube, we tracked down the founder, Allen Day, who ended up being a mellow, soft-spoken tech hobbyist, who created the site as a side project of his consulting firm Spicy Logic
Day says the site has been up only 3 weeks and already has on the order of 40,000 to 50,000 users. After a YouTube executive contacted him and asked him to remove YouTube’s content, he decided not to fight back and simply removed it. Day says that YouTube took exception to the way TinyTube transformed its video into a mobile format, which they saw as a form of redistribution. He complied with the demands but isn’t exactly happy about it.
“We are not willing to push YouTube and argue with them, though, we hope this is not permanent. As a user and a fan it is really a disappointment to see the direction that YouTube has taken,” says Day.
We’re thinking it’s not a coincidence that YouTube’s warning email was delivered around the same time that the Verizon deal was announced — there’s probably even Verizon’s lawyers lurking in the background somewhere.
Now Day says TinyTube is running Google videos and Metacafe videos, but does not have any formal agreement with these companies either. Day says he hopes to get formal agreements from content providers in the future and build a mobile video aggregation site even without YouTube’s content. Good luck. (We contacted Metacafe and Google and will update the story if they have a comment.)
Day might be pretty relaxed on the issue, but we’re not. TinyTube’s YouTube service was a symbol of how the mobile web can work as openly as the Internet. So shutting down the service means the wall is still firmly up and holding — depressing. Unlike some other publications, we’re not lawyers, so we’re not sure who’s in the right legally. But this sure makes YouTube look bad. What do you think?
Written by Katie Fehrenbacher on December 7th, 2006 with no comments.
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After we published the story about better options than the lame Verizon YouTube Lite deal, we received a half dozen complaints from mobile startups that weren’t included — that’s how crowded this market is getting. One startup that we didn’t include, but actually has a pretty slick application, is Juice Wireless. We met with the Chairman and CCO of Juice, Nick Desai, earlier this week, and he said that the company is closing a round of funding for $3.5 million next week.
The latest round includes mostly new investors, as well as existing investors like 21 Ventures and brings Juice’s total funds to $9 million (as soon as this latest round is closed). The funds will help Juice Wireless bring in more users of its mobile video and photo sharing application called Juice Caster.
We’ve been playing with Juice Caster and it’s surprisingly easy to use, though for the best experience you still have to download the application onto a video-enabled phone. (Check it out and tell us your thoughts). The startup is also doing deals with companies like AOL and FHM, to co-brand Juice’s web-based widget, which is a good idea.
The hardest thing for these mobile video and photo sharing sites will be to get enough traction (especially with a downloadable application) in the carrier-controlled mobile space. With so many companies doing similar things, it just gets that much harder. Juice has one of the better designed services out there, but as an indicator of how crowded this market is, check out the eBay fate of Mojungle.
Written by Katie Fehrenbacher on December 7th, 2006 with no comments.
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Montreal-based mobile messaging company OZ Communications says it launched a product today that will enable carriers and social networks to offer mobile social networks to cell phone subscribers. OZ customers include Cingular and T-Mobile. The company is also looking to add features which would allow mobile users to access multiple social networks from the same OZ client. We guess every mobile company has to jump on this bandwagon at some point — maybe this had something to do with all that money they raised recently.
Written by Katie Fehrenbacher on December 7th, 2006 with no comments.
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With all the talk and debates about MuniFi, few have questioned the WiFi technology itself and how well WiFi will perform for large city-wide deployments. But interestingly enough, Grand Rapids, Michigan, a place not commonly thought about as a tech leader, has announced that it has officially selected Clearwire’s WiMAX solution to unwire its 45 square miles. The city says they have chosen Clearwire’s technology because it is “cost effective and sustainable,” according to the city manager Kurt Kimball.
Cleawire will provide a discounted service of $9.95 per month for low-income residents, and this will be administered by a non-profit agency that is yet to be determined (though they are pretty quiet on how much it will cost the rest of the residents.) The plan also includes free WiFI hotspots around the city.
A city memorandum says:
“This agreement between the City and Clearwire is the first of its kind in the company’s history. Although Clearwire has over thirty wireless broadband networks across the country, they have not previously partnered with local governments. Additionally, this agreement will provide the country’s first citywide WIMAX network to be built in Grand Rapids.”
The city is making an early and perhaps risky bet on WiMAX technology, given that even Sprint’s network won’t be up and widely available for a few years. Young wireless technologies can mean more expensive equipment and less testing of networks.
Craig Settles, who has written extensively about city wireless networks, says Grand Rapids could be making a smart move in the long run given the long- range characteristics of WiMAX. But he also says that residents could face a hassle when it comes to having to buy and use the extra WiMAX equipment. While Clearwire will also offer free Wi-Fi hot spots throughout the city, Settles says, “I might have hedged my bets and made WiFi a bigger part of the equation.”
Most cities are concentrating on what’s ubiquitous and cheap now: WiFi. And many cities are already starting to make deployments and lighting up networks. That’s when the real test happens — after the paperwork and deals are done, do these things really deliver what residents want?
Portland is getting a chance to answer that question today, and MetroFi says it has just turned on a section of its free Portland network. As we wrote about recently, MetroFi has partnered with Microsoft to offer both local, targeted content and advertising to Portland residents.
Philadelphia had the launch party for its WiFi network last week, and continues to test the proof of concept network , after launching several pilot test areas. Even San Francisco officials said recently that negotiations for the city’s WiFI network could be done shortly. (Somehow we think that one might be wishful thinking).
Written by Katie Fehrenbacher on December 6th, 2006 with no comments.
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Mobile Complete, a 3-year old San Mateo-based startup that provides mobile application testing services, says it has raised a Series B investment led by Motorola Ventures. While the round size is officially undisclosed, it is rumored to be around $10 million. Previous investor Innovacom VC also participated in the round.
The company says it’s using the new funds to expand its service internationally and add more mobile handsets to its testing of roster of 300+ list of handsets. Check out the company’s virtual device-testing service called Deviceanywhere.com.
The biggest problem mobile developers face when creating mobile content is making that content work on hundreds of devices - obviously Motorola thinks this will help solve that problem. All you mobile developers check out their service and tell us how you like it.
Written by Katie Fehrenbacher on December 6th, 2006 with no comments.
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Mojungle, a mobile media-sharing startup, is the latest company to put itself up for sale on eBay, with the bid starting at $60,000. The Los Angeles-based startup is less than a year old and has bootstrapped itself with just three full time employees. Mojungle CEO Ophir Tanz said they are shooting for at least $250,000 for the sale of the entire company including the technology, the design, and the domain name.
Tanz said the decision was bittersweet, but thought the company has a lot of potential for the right buyer – the eBay listing explains why they are looking to sell:
“The decision to sell Mojungle was a difficult one. We’ve encountered unanticipated and growing personal and business obligations not allowing us to make the full time commitment needed to build Mojungle into the strong brand we know it can be.”
The move is also another sign that the mobile content-sharing space is starting to become over run with startups pitching themselves as “MySpace for mobile,” and mobile social networks. Mojungle enables users to send camera phone photos and videos to the web, which are playable on the Mojungle player that can be embedded in sites like MySpace and Piczo.
Tanz says while the mobile market is still early for consumers, the market for mobile content sharing startups is getting somewhat saturated. “Everyone is still trying to find the right business model, and right now there are a lot of limitations in the market, like interoperability,” Tanz says.
There’s also a rush of these companies because VCs have been pouring money into them. In the eBay listing the company says:
“Mojungle is a self-funded company. We have been approached by several Venture Capital firms and independent companies looking for partnership opportunities. There is currently one, in particular, that is interested and ready to work with Mojungle to create a new product offering for its clients. We will be happy to make the connection, post-sale, if desired.”
The Mojungle crew has high hopes for the company after the sale, and Tanz says he thinks the closed carrier-controlled industry will open up in the near future. But obviously not in time for the original founders to stay at the helm of Mojungle. “It’s not the way I thought it would end, says Tanz.
Anyone interested in buying?
Written by Katie Fehrenbacher on December 5th, 2006 with no comments.
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Analysis
We guess Monday morning is as good a time as any to announce massive chip deals. Not one, not two, but three of them.
Qualcomm says it is buying two chip companies, Airgo and the majority of RF Micro Devices, and meanwhile LSI Logic says it is buying Agere Systems. These purchases, along with the ongoing patent fights within the wireless chip industry, highlight how big the stakes are in the battle over the silicon in connected mobile devices.
Qualcomm is able to lead the market for 3G cell phone chips, but has been trying to build up its portfolio with other wireless networking technologies. Qualcomm has been particularly interested in companies with a lot of patents in this area, and Palo Alto-based Airgo holds numerous valuable intellectual property for MIMO (multiple-in, multiple-out) — a technology that enables frequency to carry more data and boosts the transmission speed.
Airgo maintains that it is the first to market WiFi plus MIMO technology, and combined with Qualcomm, the technology can be more easily integrated into the mobile market.
“With the increasing importance of mobile broadband solutions for the laptop, Qualcomm may be able to gain Wi-Fi market share as cellular modem vendors purchase 3G/802.11n chipsets,” said ABI Research senior analyst Philip Solis. “However the powerful Intel “Centrino” brand will be a significant obstacle to Qualcomm’s success in that sector.”
ABI Research principal analyst Stuart Carlaw notes that “With Qualcomm’s history of integration, these acquisitions provide a very logical precursor to a highly integrated series of cellular chipsets that incorporate both 802.11n and Bluetooth. Outside the cell phone, Qualcomm now effectively owns a stake in the Bluetooth market that will enable it to expand into the CE environment with greater ease, due to the growing profile of Bluetooth in the gaming, PMP and music player markets.”
Qualcomm also said today that it has purchased the majority of North Carolina-based RF Micro Devices’s Bluetooth technology, which makes an enhanced Bluetooth technology for mobile devices and headsets.
Then there is the news that LSI Logic is buying Agere Systems for $4 billion in stock which will boost its move into chips for wireless and fixed networking and storage.
As mobile devices and networks become more advanced, Qualcomm and the other wireless chip companies are packing devices with all sorts of silicon to create the connections — Bluetooth, WiFi, cellular, etc. Broadcom has been emphasizing its push into mobile phones recently, and Motorola bought 3G software and chip company TTP this summer.
Whatever company can develop the best ways to wirelessly connect devices and defend those patents in courts, will dominate the future wireless market. Last week a Nokia executive said that the ongoing patent fights between Qualcomm, Nokia, Broadcom, and others will determine the industry’s future.
Qualcomm will now have its newly acquired Airgo IP to continue to battle its competitors in courts. For companies that have been battling and complaining about Qualcomm’s chip royalties, the news isn’t necessarily good. Look forward to more wireless-inspired patent fights.
Written by Katie Fehrenbacher on December 5th, 2006 with no comments.
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When the carrier 3 announced its X-Series efforts in the U.K. earlier this month, wireless enthusiasts saw it as a sign that the walled garden was finally coming down — though, the decision likely had as much to do with the company’s financial issues as any kind of revolution.
Today 3 announced the pricing of their X-Series service with two choices, 5 pounds ($10) or 10 pounds ($20) per month. While the company seems to have mostly stayed true to their low, flat fee, Internet-inspired intentions, they also added “fair use” guidelines — like a tiger, a carrier can’t really change its stripes.
The X-Series fair use guidelines:
- - 5,000 Skype to Skype minutes per month.
- - Windows Live Messenger: 10,000 messages per month
- - 1GB per month for browsing
- - Orb and Slingbox: 80 hours a month with X-Series Gold
3 says “where unfair use is apparent, 3 will take the appropriate measures on a case-by-case basis.” It seems like carriers still feel that truly unlimited is just not in their best business interests.
Beyond the fair use reminder, 3’s flat fee pricing is actually pretty compelling. The two packages are X-Series Silver at 5 pounds per month ($10) and X-Series Gold at 10 pounds ($20) per month (that’s not including the extra fees for voice and texting services.)
For X-Series Silver you get “unlimited” (within fair use) mobile web browsing/searching, “unlimited” Skype calls with Skype PC users and Skype 3 mobile customers, and “unlimited” instant messages, to or from Windows Live Messenger or Yahoo! Messenger, to another X-Series cell phone, or a PC. (Update: The Skype service is based on the iSkoot solution.)
For X-Series Gold you get everything that silver gets, except you also get “unlimited” access to your TV with Slingbox and your PC with Orb. Currently both X-Series are only available on two handsets, the Nokia N73 and the Sony Ericsson W950i.
3’s X-Series services will be an interesting experiment to see if consumers will pay these somewhat reasonable fees for a more ideal mobile broadband experience. Other carriers could follow 3’s lead, or the low pricing and flat fee could just add to 3’s financial quandry.
Written by Katie Fehrenbacher on December 2nd, 2006 with no comments.
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Large cable companies, Time Warner Cable and Comcast among them, have partnered with Sprint Nextel to offer four play bundles to customers.
Four play bundle constitutes of wireless, broadband, voice and cable services. These bundles are supposed to frustrate the phone companies and steal their customers. Nevertheless, how that drama plays out, we think it could be a net win for Emeryville, Calif.-based MobiTV.
Our sources close to the company tell us that MobiTV is powering the “mobile television” part of the recently announced Comcast wireless service in Portland and Boston. The company is now delivering wireless television, and Comcast listings on Sprint-Nextel phones that are supposed to work with Comcast four-play offering. The company, declined to comment, when asked them for further details. It is still not clear if they are behing TWC’s wireless TV offering. (Since I was stuck for much of the day flying back from NYC, I plan to pester them later this morning.)
MobiTV which has raised an upwards of $125 million in venture funding, has become the wireless television delivery mechanism for most major carriers - Sprint Nextel, Cingular, and AT&T. Adding Comcast to the mix is a coup for the company. They have also expanded into delivering television over WiFi. There is a school of thought that when DVB and MediaFlo come to market, MobiTV will be toast. On the other hand, if they sign-up most major carriers, then it would be hard to replace their offering. Of course, there is the other option: Qualcomm buys them. (Just like Flarion.)
Written by Om Malik on December 2nd, 2006 with no comments.
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We’ve written a few times about the startup Meraki Networks, which is building a business off of wireless mesh hardware and software based on the MIT’s Roofnet project. Google has been very interested in the Mountain View-based startup as a way to extend its WiFi network coverage indoors. Now Meraki’s co-founder Sanjit Biswas tells us that the company completed a bridge round of funding last week, which included Google and “a few Silicon Valley angels.”
Biswas wouldn’t specify the amount but said the round was under a million dollars. “We’d bootstrapped the company so far, so this cash is really just for growth/acceleration . . .and for the development of some products we plan to launch next year,” says Biswas. The company currently sells a $49 wireless 802.11b/g router (that’s the beta price, see below) that allows users to build a wireless mesh network or extend the range of a municipal network.
Previously Biswas told us that Google had entered into a vendor/contractor relationship with Meraki. At a San Francisco WiFi community meeting Google showed off a Meraki router as a good, inexpensive way for residents to extend San Francisco’s planned city-wide WiFi network indoors. But it’s also somewhat rare for Google to invest (and not just acquire) startups. It seems like when it comes to alternative ways to extend broadband coverage, Google is willing to play investor — the company also previously invested in broadband over powerline company Current Communications.
Google’s Chris Sacca told us last month that Google was partly interested in Meraki to help the company keep its products running on an open platform. Meraki’s current product, the Meraki Minis, use an open platform and the company is encouraging users to tinker around and install their own software. But Biswas says the router isn’t completely open source and part of the software is closed. Meraki is trying to commercialize the work they did at MIT, while also trying to stay true to their open-source background — i.e. have a decent business model, but keep it as open as they can.
Meraki says their goal is to enable a grassroots movement of small wireless ISPs by providing them everything they need to get started. Those goals match to what Google has been stating about their plans for their WiFi networks — deliver wireless broadband for cheap and outside the confines of the current telco/cable industries.
Update: Meraki has been listing its routers for $49 while the company is in beta, but Biswas says the final price will likely be somewhere under $100. “Our goal is to make Meraki routers as widespread as possible, which means leaving room for reseller and
retail margins, so we have to raise the price post-beta.”
Written by Katie Fehrenbacher on December 1st, 2006 with no comments.
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There’s yet another report on location-based services from the offices of ABI research this week, stating that 20 million cell phone subscribers in North America will be using “personal locator services” in 2011 — that’s up from 500,000 this year, they say. Whoah, that’s a pretty big number! Personal locator services are the much-hyped social mobile GPS services applications like Helio’s new “buddy beacon,” startup Loopt or some of the carrier’s kid-tracking services.
These services are the most fun to discuss and write about, but likely won’t make half the revenues that mobile navigation or business-based mobile GPS applications will generate in North America. They are interesting services nonetheless, not necessarily because of their potential to make money, but because they will be more about helping carriers differentiate and creating a buzz for a carrier brand — that’s why the non-traditional carriers Boost and Helio are the first ones to push “friend finders” in the U.S.
In Japan and Korea, where mobile friend finder services have more traction, carriers found around $3 was an acceptable subscription rate for a friend-finder service. Loopt will charge $2.99 per month to use the service starting in 2007, and they say they have already brought in 40,000 users over Boost during the free trial. Three dollars is not really enough for a carrier to make a lot of money just through subscriptions (maybe decent for a startup), but a nice thing to differentiate a brand.
That’s why the more traditional carriers haven’t been falling all over themselves to offer $3 friend finders. Plus the privacy concerns involved. “Family finders” or kid-tracking services, can manage to charge more, around $10, by appealing to parents fears of knowing where there kids are at all times.
For some reason ABI is particularly bullish on the Helio service, though we’re not sure why:
“Helio’s Buddy Beacon is going to be very popular,” says ABI Research senior analyst Ken Hyers. “It’s innovative. This is the first service of its kind in North America.”
Mark Jacobstein, Loopt’s EVP Corporate Development and Marketing, says Loopt’s service was out before Helio’s and Loopts 40,000 users are already more subscribers to their service than Helio has total subs.
Written by Katie Fehrenbacher on November 30th, 2006 with no comments.
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We wrote about mobile messaging company OZ Communication’s second round of funding in September, but didn’t have a size for the round. Now OZ says the second round is $34 million, led by Canadian institutional fund manager, Caisse de dépôt et placement du Québec, which brings the company’s total to around $61 million. That is considerable funding for a company that sells mobile messaging handset and server software.
The company has a decent business model, though: help carriers provide mobile IM and email to customers. Other mobile messaging companies like Berggi, which we wrote about recently, are trying the direct to consumer approach with a download that bundles IM, email and text. A lot of the newer basic phones we have tested are already including IM clients (with or without OZ), so getting consumers to pay a monthly fee for an extra mobile messaging application like Berggi’s seems like a stretch.
But the amount of subscribers using mobile IM, is going to grow dramatically over the next few years. A report that Forrester emailed us this morning says that IM is the number one “must-have” feature from a list of “advanced cell phone features” for U.S. teenagers when choosing a new cell phone model. The survey included 4,500 teenagers, and the other advanced features were things like camera, mobile Internet, push-to-talk, MP3 playback, mobile email and picture messaging. Makes sense to me, I am fully addicted to Google chat on BlackBerry.
Written by Katie Fehrenbacher on November 28th, 2006 with no comments.
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Both Ericsson and Nokia will supply network equipment for the deployment of T-Mobile’s planned 3G network in the U.S, the companies said this morning. Ericsson said it will “serve as the prime radio provider for WCDMA 3G services in certain markets, including New York City which is scheduled to be operational in 2007.” Nokia said it will deliver its “Flexi WCDMA Base Station optimized for T-Mobile’s newly acquired AWS spectrum bands.”
Back in October, Deutsche Telekom, T Mobile US’s German parent, said it would spend a total of $2.64 billion on a U.S. 3G network. The company planned to start deploying its network in the fourth quarter of this year, with most of the work planned to be completed in 2007 and 2008.
Today’s dueling press releases from Nokia and Ericsson are rather vague and don’t include any financial values of the contracts or if there are other equipment providers involved. But the equipment provider choices aren’t too surprising.
Ericsson has been winning over an increasing amount of carriers for HSPA deployments, and has signed up around 30 to date, including Hutchison Italy, UK, 3, according to a report from RBC Capital markets. The RBC report also says:
Ericsson may be gaining share from Alcatel/Lucent and Nokia/Siemens, both of whom are mired in major integration efforts. . . Nortel is losing share largely in part due to it abandoned UMTS plans . . . while pricing concerns persist, Ericsson may be better positioned to absorb competitive pricing actions due to its dominant market position.
Nokia says it has 64 customers to date for WCDMA 3G — almost half of the 134 commercially launched WCDMA 3G networks, including providing HSDPA networks for T-Mobile in Germany, the United Kingdom and the Netherlands.
Written by Katie Fehrenbacher on November 28th, 2006 with no comments.
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STARTUP: MyWaves, based in Sunnyvale, CA.
ELEVATOR PITCH: Watch, and share web videos on your cell phone.
WHAT THEY DO: MyWaves delivers web-based video clips to cell phones. The site is designed so users can create and subscribe to other’s “video channels,” which are a series of back-to-back video clips. To make money, the company says it is doing licensing deals with carriers and offering sponsorship and branding deals for companies looking to reach mobile communities.
PEOPLE: CEO Rajeev Raman, a former EIR at Menlo Ventures, the company has 16 employees, and boasts executives from Napster, TiVo, Danger and Yahoo.
FUNDING: $6 million in Series A from Menlo Ventures.
COMPETITORS: Eyespot, Juice Wireless, ComVu, Veeker, Treemo, vpod.tv carrier video-sharing services like 3’s “See Me TV,” and online video companies that are doing mobile deals like YouTube.
THE DEAL: MyWaves recently launched its mobile video service into a sea of competitors — sharing video camera phone content is everyone’s favorite topic. MyWaves is different in that the company is focusing on its service for watching shared videos via cell phones. Unlike many companies that are concentrating on sending video camera phone content to be shared on the web, MyWaves aims at sharing web videos on the mobile.
To use the service you need a video-capable, data-enabled phone, and to get the best experience you should download the MyWaves application onto your cell phone, (not available for Verizon users yet). All that eliminates a lot of cell phone users right there. But if you do have a sophisticated enough phone to sign up, the company says its video technology determines the best video experience by determining factors like phone capabilities, network capabilities, and video capabilities on the fly.
My first thought was why reinvent the wheel and not just use MMS to watch user-generated cell phone videos? Raman says MMS is too limited by carriers, allowing no more than 15 seconds of video per message, not interactive enough, and basically designed to meet a messaging need, not entertainment.
Overall I think the company’s underlying mobile delivery technology is more interesting than some of the more basic mobile video-sharing startups on the market today. But at this point the service is hard to use and only available to a select audience. I tested the service on a Cingular LG CU500 and it took a really long time to go through the sign up process — Raman says they are working on simplifying it, as well as enhancing the how-to section. If this service simplified its design and interface, I could see the market ready for this maybe next year.
Written by Katie Fehrenbacher on November 27th, 2006 with no comments.
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Vodafone’s CEO Arun Sarin tells Businessweek that he expects the combination of social networks, mobile advertising, and mobile video (along with other “advanced mobile applications) will generate 10% of the company’s revenue within three or four years. We’re thinking that’s rather optimistic.
We expect these services to generate 10% of our revenue within three or four years,” he says. Vodafone generated $29.4 billion in revenue and $6.6 billion in profit during the first half of the year, beating analyst forecasts.
We looked at their revenue projections - about $59.12 billion for the year ending March 2007 and $62.29 billion for year ending March 2008. At an average annual growth rate of 5%, the company could have sales of around $70 billion by 2010. In other words, 10% of the company’s revenue would work out to about $7 billion. Yikes… that’s just a little less than what Google is estimated to make in sales this year. That is a lot of money from those advanced mobile applications!
Chew on that, while you chew that turkey! Happy Thanksgiving all!
Written by Katie Fehrenbacher on November 23rd, 2006 with no comments.
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The CEO of Israeli WiFi software equipment company InspiAir, Tamir Galili, says the inherent limitations of WiFi mesh technology are behind some of the slow MuniFi rollouts in U.S. cities — a lot of the test pilots that these cities are doing are failing, and mesh is just not suitable, he says.
Is he just trying to sell InspiAir’s alternative WiFi software and hardware solutions, or is there any truth at all in his assertion? The poor quality of some MuniFi networks is something which is starting to be discussed, but we always thought it had to do with the limits on WiFi and not the mesh architecture. If there are issues with the mesh architecture itself, that could end up being a startling upset for companies like Earthlink and Tropos, as well as cities that have already committed to these companies. That is if there is any truth in this.
Though, Galili is pretty vague on the details of how his technology is better. He says that the company’s proprietary software for WiFi equipment provides an optimized signal that beats out products like Tropos’ on range, and a better use of voice and video. When I asked for more of an explanation of the technology he pointed me to the company’s white paper — thanks, more jargon.
Galili says the company has WiFi networks mostly in Asia and Europe, including the city of Helsinki and a hotspot in Manhattan. When I asked him about the limitations of mesh vs WiFi, he said “the “Mesh people” can blame the WiFi, however, as I told you, those “WiFi limitations” do not exists for InspiAir users.”
Glenn Fleishmann at WiFiNetNews has been pretty skeptical of the company, and questions the physics behind their claims. This story in Techworld calls their technology “WiFi Black Magic,” though I’m not sure if that is good or bad. We asked WiFi analyst Craig Settles who specializes in Municipal wireless networking what he’d heard about the limitations of mesh itself. He says:
WiFi mesh is indeed limited in certain respects. It’s not great for indoor coverage, it is susceptible to interference by devices as basic as microwave ovens, trees and buildings, which can block the signals. The couple of companies that have supposedly better products that overcome these shortcomings are not ones that have made headway in the marketplace.”
We called Tropos’ Director of Marketing Bert Williams, looking for the counter argument. He said, “Yeah, I’ve heard they’ve (InspiAir) been dissing mesh. WiFi, whether it be regular or mesh, has the same limitations that the Internet has on sharing bandwidth. You have to layer a quality of service over it.” Basically, any limitations are not mesh related, he says.
That doesn’t hide the fact that many publications have written about the potential limitations of Tropos’ equipment recently, and some have complained about spotty reception that marks Google’s Mountain View municipal wireless network. Google says they are happy with the Tropos product. Williams won’t comment on the Mountain View network but says there are always a certain amount of complaints about communications services.
Galili said the U.S. is the most advanced in the world when it comes to MuniFi deployments, so I asked him why then is everyone in the U.S. betting on mesh. He says mesh is the incumbent technology and InspiAir is new to the market. That is one strong statement — can he really back it up? Or is he just an easily quotable executive with a good PR team?
Written by Katie Fehrenbacher on November 23rd, 2006 with no comments.
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