Browser wars

When rumors began to circulate that Japanese carrier NTT DoCoMo planned to buy into AT&T Wireless last year, shares of Openwave, the primary provider of Wireless Application Protocol gateways, fell. Investors were nervous that NTT DoCoMo's proprietary i-mode technology would begin to take a chunk out of the WAP market.

The industry had wondered throughout most of 2000 whether NTT DoCoMo—considered the most successful company at selling wireless data services—would be able to port its wildly popular i-mode service outside of Japan.

Just this month, the company forged a joint venture with Telecom Italia Mobile of Italy and KPN Mobile of the Netherlands to bring i-mode to Europe. NTT DoCoMo already holds minority interests in Hong Kong-based Hutchison and in AT&T Wireless. AT&T Wireless and NTT DoCoMo also are forming a separate business unit to create wireless Internet applications. Hutchison is offering i-mode-branded services.

The timing has seemed right for i-mode's invasion as the wireless industry begins to see a customer backlash against WAP-based services, which have been characterized as slow and frustrating. In contrast, NTT DoCoMo marketed the service to its customers perfectly, offering the compelling applications and rich graphics that Japanese users crave.

But whether i-mode is portable outside Japan remains to be seen. Paul Chapple, manager of U.S. business development for Nokia Mobile Phones, believes i-mode is difficult if not impossible to duplicate elsewhere. Low PC penetration and the Japanese infatuation with hand-held devices are major factors that have helped spur adoption of the service among more than 17 million people. Even using the Japanese language on mobile phones is more efficient because the Kanji language uses fewer symbols than English text, Chapple said.

NTT DoCoMo's competing operators, using WAP technology, have seen huge take-up rates of wireless Internet service as well, putting into question whether i-mode's success results from its technology or the Japanese infatuation with wireless Internet services in general.

That's not to say having NTT DoCoMo in one's corner isn't beneficial. “It's the technology of i-mode for profiling customers and data-basing their preferences that we think will be important here,” said Roderick Nelson, chief technology officer for AT&T Wireless, in a conference call with analysts in December 2000. “We recognize the substantial culture differences in the U.S. and Japan. They do have more experience than any other wireless carrier at taking wireless data into a successful business model. We think we will benefit from that immensely.”

NTT DoCoMo, KPN and Telecom Italia Mobile said their joint venture will combine the relevant skills and experience of each company—NTT DoCoMo's i-mode experience, KPN's value-added services offerings and Telecom Italia Mobile's deployment of complex platforms such as prepaid services and real-time billing, to the mass market. Services of the joint venture will include gaming, exchange of messages, and images and mobile transactions.

Location-based information also will be available, according to Telecom Italia Mobile officials. The mobile Internet services initially will be introduced in Italy and in markets where KPN has a mobile presence—Germany, the Netherlands and Belgium. NTT DoCoMo holds a minority interest in KPN.

AT&T Wireless, KPN and Telecom Italia Mobile plan to offer phones with WAP and compact HTML browsers. WAP, or WML, is a wireless markup language that requires developers to translate content from today's HTML Internet language for wireless applications. cHTML is a proprietary NTT DoCoMo protocol more closely based on HTML.

Ben Linder, vice president of marketing for Openwave, which holds a majority share of the WAP server and browser market, said his company isn't worried about i-mode's entrance worldwide. i-mode doesn't appear to be interfering with WAP.

“We view i-mode as an incredibly successful business model and a real boost to the wireless Internet worldwide,” Linder said. “It's clearly visible that NTT is not actively exporting the proprietary underpinnings of i-mode outside of Japan. It's not a technology play. They are using WAP to deploy these services around the world.”

i-mode is composed of four layers, Linder explained. Two layers of the service are proprietary to NTT DoCoMo: The network, which is based on Personal Digital Cellular technology, and the middleware software, based on cHTML, which is architecturally the same as WAP, he said. The other two layers are what NTT DoCoMo appears to be porting out of Japan. One includes the business model that calls for developers to pay for content for which the carrier bills. The other is the i-mode brand, a valuable piece as carriers worldwide try to mimic NTT DoCoMo's success in creating compelling content for end users.

Hong Kong's Hutchison has rolled out i-mode branded services on top of WAP infrastructure. Though Hutchison handsets use dual-mode cHTML/WAP browsers, Openwave's WAP gateway translates cHTML sites into WAP at the carrier's network. KPN and Telecom Italia Mobile also plan to offer i-mode services on top of WAP services as well.

The European operators will work with a select number of handset manufacturers to build cHTML/WAP handsets. They expect to introduce the handsets by year's end, but whether these types of handsets will gain momentum is questionable. Virtually all content written for cHTML is Japanese content, while WAP now has the support of more than 20,000 content developers worldwide, said Scott Goldman, chief executive officer of the WAP Forum.

For its part, the world's largest handset maker, Nokia, is encouraging carriers to hold out for the next version of WAP, called WAP 2.0. WAP and cHTML are expected to evolve into a browser standard known as xHTML by 2002. This will allow developers to use a single language and a single set of tools to write Web pages that are more easily adaptable to PCs and handsets.

“The difference between WAP 2.0 and cHTML is very, very small. I don't see running a dual-mode browser in 2001 or 2002 being a particular advantage because most of the cHTML advantage is built in Japan,” Nokia's Chapple said. “Timing is about the same for both [xHTML and cHTML/WAP browsers]. From a software perspective, Nokia is very close… You can't upgrade browsers by dropping them in phones. For that, we strongly suggest staying along the WAP path where they are assured of backward compatibility.”

The WAP 2.0 standard is expected to be published by June, with commercial product available in 2002, Linder said. Experts suggest any move to an HTML-based format cannot be done before WAP 2.0 products become available because it could take nearly 18 months to develop dual-mode browsers. AT&T Wireless recognizes this and has indicated it may wait for xHTML browsers. Nokia and Ericsson manufacture i-mode handsets for NTT DoCoMo.

Carriers are voicing their interest in dual-mode browsers because of the negative publicity surrounding WAP today. They are looking for alternatives. VoiceStream Wireless indicated it will employ a dual-mode browser based on WAP and Microsoft's HTML browser. Sprint PCS will launch WAP services shortly, and will offer phones that handle HTML formats, said a company spokesman.

“Text is not interesting to people. It certainly hasn't been a differentiator for the network operator, and end users are not willing to pay a premium for WAP on the phone,” said Jane Zweig, executive vice president of Herschel Shosteck Associates.

A recent study on WAP usability from the Nielsen Norman Group concluded that the wireless Web won't work during 2001 but should grow in subsequent years.

“We thus recommend that companies sit out the current generation of WAP but continue planning their mobile Internet strategy,” noted the study. “Don't waste your money on fielding services that nobody will use; as we document this report, WAP usability remains poor. Instead, plan on launching mobile services as soon as the next generation of devices ships.”

The WAP Forum is facilitating improvements in today's WAP standard this year, which should ease some frustrations customers have with the service, Chapple said.

“It's important to look at the kinds of services we're expecting in 2001 that don't exist in WAP yet,” he said. “Up to now, we've been taking generic Internet services and getting them to run on a phone. That created services that were not as compelling as they could be… A lot can be done just within the network to add services that are more compelling to end users.”

One major improvement will be a push specification, which will allow operators to push content to end users rather than requiring them to hunt and retrieve information, which has become a frustrating process for many WAP users. The WAP standard also will support location-based services, which are touted as the Holy Grail of wireless data services because the wireless industry can uniquely offer them.

“There are always going to be a lot of announcements, and that's people trying to cover all of their bases while WAP is spinning up to speed,” Goldman said. “There were 20,000 applications available [last] year for WAP. Any thoughts of anything else will become moot.”

“WAP is an evolving process,” he said. “We're moving as fast as we can and going faster than any other standard ever built. It is an emerging technology, and it will not be 100% perfect. WAP was never designed to be the single protocol for every device. Nothing will ever be that. But having a world standard subscribed to gives WAP tremendous momentum that no other technology can claim at its early stages.”

Briefly

Cingular ups customer count

Cingular Interactive, formerly BellSouth Wireless Data, added an average of 90,000 customers per quarter during 2000, ending the year with more than 570,000 subscribers. The number includes MyBiz Interactive subscribers, Palm.Net subscribers using Palm VII connected organizer, Fidelity InstantBroker customers, AOL Mobile Communicator subscribers and RIM BlackBerry wireless e-mail solution users.

E911 agreement

SCC Communications signed a multiyear agreement with AT&T Wireless to provide enhanced 911 infrastructure, which includes call routing and delivery and transmission of wireless location data.

Qualcomm's patents upheld

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