With so much at stake for carriers in the adoption of wireless data, companies are developing new ways to make content easier to discover and use on the handset – and some carriers are taking notice.
The on-device portal (ODP) space is starting to gain a following, at least in terms of the number of companies following others into the arena.
|
Subscribers can customize
their phones and arrange icons. |
While few research reports are available on the ODP market, London-based ARCchart over a year ago came out with what is believed to be the first report addressing the space. Back then, the report analyzed 14 vendors, but the number of players is probably closer to 25 nowadays, says Matt Lewis, research director at ARCchart. The research firm, which is updating its stats, predicts the ODP market will be valued at more than $1 billion by 2009.
ANOTHER ACRONYM
Just what constitutes an ODP? About the only thing industry insiders agree on is the definition is murky. At the most basic level, ODP refers to applications that run on the handset and try to achieve a number of things, with the underlying mission being to make content easier to discover and use, Lewis says. Companies might offer an on-device store front or a home-screen replacement product.
Others point to Alltel Wireless’ Celltop, Yahoo! Go and Apple’s iPhone as examples of ODPs. Some have even suggested an ODP as an alternative for brands to act like an MVNO without all the hassle of becoming an MVNO.
Handmark, a 90-employee and growing company based in Kansas City, Mo., could be considered the ODP runaway success in the North American market, says Douglas Edwards, co-founder and chief marketing officer at Handmark. After all, the company, which powers Sprint Nextel’s On Demand services, has seen more than 2 million versions of its PocketExpress information and infotainment service downloaded. In terms of its position in the ODP space, “we offer the most robust solution,” Edwards says.
In North America, Handmark’s strategy is to work directly with carriers, but it has different distribution models worldwide based on the way the end-user obtains a device. Earlier this year, the company introduced a version of Pocket Express for the Nokia Eseries in the United Kindom, where Handmark is more likely to work directly with handset suppliers.
For Action Engine, a Bellevue, Wash.-based company, the initial ARCchart report helped validate ODP as an industry segment, lending independent third-party support, says Amar Patel, the company’s director of product management. One of the conclusions ARCchart researchers made was that while mobile carriers initially would lead ODP deployments, media companies ultimately will dominate. That’s proving true in Action Engine’s case.
Like many vendors, Action Engine found that the sales cycle with carriers could be anywhere from nine months to a year. “If you get the right media and content brand, the sales cycle for the operator can be a day,” he says. “That obviously is a significant accelerator to grow our business.”
It makes more sense for a brand to approach the operator than a company such as Action Engine, he says, so Action Engine is working direct with media/content companies. “At the end of the day, mobile operators don’t know Action Engine from Adam, if you will. We’re a very small company,” he says “We like to ride the coattails of the brand and let them use their muscle.” Action Engine already works with the likes of AOL, MSNBC and Tivo.
SOLUTIONS IN MOTION
Alltel claimed a first in January when it unveiled Celltop, which lets users modify the appearance, presentation and organization of information within “cells” on their handsets. That offering, available on select handsets, uses Qualcomm’s uiOne, an ODP that is a subset of the BREW services. Sprint also uses uiOne via the Handmark service.
uiOne is the result of Qualcomm’s 2004 purchase of Trigenix. With that acquisition, Qualcomm obtained user interface (UI) development technologies, products and tools and extended its presence in the European market. Six operators thus far have announced they are using uiOne: Alltel, Sprint Nextel, U.S. Cellular, O2, Telecom Italia and Telecom New Zealand.
uiOne runs on top of the BREW client but doesn’t require an operator to adopt the entire BREW ecosystem. It essentially allows users to customize their phones, similar to how a desktop PC user might arrange the icons on a computer screen. Users can more easily access and manage information, and more bells and whistles are in the works.
With operators so hungry for ways to increase the discovery and use of content, one has to wonder why more haven’t implemented ODP solutions. But the technology is still in the early phases, and operators are just now getting their hands around them, working out agreements with OEMs, standardizing across multiple devices and figuring out business models, according to Bob Briggs, senior vice president and general manager, BREW, at Qualcomm Internet Services. And, Edwards notes, “the telecom industry moves slowly,” even though Handmark can show a doubling of data average revenue per unit (ARPU) with Pocket Express.
Given the increasing number of companies in the ODP arena, is consolidation in the cards? ARCchart’s Lewis doesn’t believe so, at least not until valuations come down. Some of the companies have raised a lot of cash, so their valuations are high and it would be difficult for a buyer to justify the price tag. In addition, “there’s still a gold rush mentality,” whereby a lot of vendors want to chase market share and become the “biggest and the best” before they look at consolidation.
Perhaps even more companies will join the party before all is said and done.