Keep on moving

The mobile Internet is poised and ready, but service providers need to realize which applications are most important, which solutions are the best enablers and which markets are the most lucrative

Carry the Internet around in your pocket, briefcase, purse, backpack or car? The mobile Internet is arriving, and it will change our lives as much as the telephone did more than a century ago.

Forecasts for users of wireless data, including the Internet, range from 100 million worldwide to 400 million by the end of 2003, and some industry watchers call those estimates conservative. Before long, users will employ mobile wireless devices to access the Web more often than they use PCs.

The reasons for such phenomenal growth are clear. Imagine a road warrior being alerted automatically that her plane is delayed for three hours - before cutting short a meeting and fighting heavy traffic to the airport. Or being able to find an automated teller machine within walking distance in a strange city.Imagine getting an alert from one's broker that Acme Widgets has just gone above $38 per share and immediately buying or selling a position. Or finding the closest fast food restaurant or filling station when sorely in need of a pit stop on a rural stretch of an interstate.

Users likely will find such personal, useful, value-added services indispensable. Early adopters already do, and the services available now are nothing like what will come.

Around the world Many Europeans and Asians are accustomed to a variety of new conveniences such as paying the parking meter by phone.

More than 12 million Japanese users of NTT DoCoMo's i-mode service surf the Internet in color - shopping, buying and selling stocks and accessing content from thousands of application providers and independent Web sites.

Service providers can gain subscriber loyalty by customizing services so they are delivered anywhere the user is. Wrapping the user in a quantity of personally desirable services builds customer retention. In addition, the provider will find revenues growing, from increased usage of services, minutes of use and revenue sharing with application providers.

One forecast for Europe shows revenues per subscriber increasing from about $34 per month today to about $71 per month a decade from now. And market penetration for wireless in Europe is expected to reach 80% by 2005. Will other regions show the same acceptance? You bet. Convenience is a powerful draw.

Moreover, the entire revenue model changes with the mobile Internet. Rather than simply billing subscribers for minutes of use, service providers will be able to share in the revenues of applications providers, portal suppliers, content providers and other participants in a whole new value chain.

Of course, that new value chain is more complex, and it requires new expertise and specific network capabilities such as a high-bandwidth, IP-centric infrastructure. Making the most of it will require partners that have the right products and the know-how to build a network that can support the new value chain.

Use the power Many market trends are driving the move to the mobile Internet. Foremost is the over-whelming global value of the Internet.

In short order, people have come to depend on its reach to almost any source in the world and use it for finding names of potential customers in Australia, retrieving resources from company databases, bill paying, stock re-search and checking satellite weather maps.

Mobile commerce via the Internet, whether known as shopping or the more formal procurement, already is big and will drive much of the mobile Internet's success. IDC forecasts that by 2004, Americans will conduct $21 billion worth of commerce by mobile phone.

Adventis projects that by 2005, mobile or m-commerce will account for almost half of the $1.5 trillion of goods and services sold over the Internet.

Some service providers already have begun to tailor services to individual users by allowing them to build a menu - a personal portal - that offers the services they have chosen, whether it's stock quotes and alerts, sports scores, weather, news headlines, a link to Amazon.com or links to their corporate intranets and services.

The user needs a phone equipped with a specially designed browser and a display for Web-based information, generally data that's filtered through the Wireless Application Protocol (WAP). WAP formats a full-size Web page for the mobile phone's smaller display; usually the screen displays just text.

But to change people's lives, the mobile Internet experience must get more up close and personal by enabling existing and especially developed applications to be aware of where the user is or whether her phone is active. Examples include:

- Knowing the longitude and latitude of the taxi bearing a road warrior to the airport, an Internet application might warn the traveler of a flight cancellation. The user then could look up alternate flights and book a new ticket right from the phone.

- Upon request of an ardent fan, another application might find that fan - unfortunately fog-bound in San Francisco on Saturday - and report the score every time Illinois scores a touchdown against Ohio State. Of course, the user also could listen to the entire game over the phone. The phone also might give the hapless strandee a coupon for a dinner at an Italian restaurant a couple of blocks away, along with its menu and wine list.

- A sales rep leaving a customer meeting might order a group of components the customer needs through a business-to-business portal, let the portal search and get a report on availability and best prices upon arrival at the next city on her itinerary.

What all these transactions share is convenience - clearly the key to wide adoption of m-commerce - and convenience depends on personalization.

The user tells the service provider and the application exactly what she wants, whether it's quarterly scores delivered only when the user isn't on home ground, the menus of and maps to a selection of restaurants anywhere, the names of restaurants at the next four service plazas or the arrival times of planes bringing colleagues to a joint meeting.

How about being warned before an upcoming interchange on I-75 that just beyond it is the tail of a 10-mile traffic jam?

The preparation and delivery of such information can be automatic - after making a request, the user can move on to other activities and get the information when the time is right. This high-touch care can become a taken-for-granted part of the customer relationship.

Providers will have options to bundle services and minutes of use in ways that maximize their revenues, while tailoring plans to customers' needs. They'll also be able to offer customers a variety of mobile devices with which to access the Internet: personal digital assistants and pagers, the cell phone or units that combine functions of each.

The sum is much greater than the parts: The mobile Internet is much more than the mobile phone and the Internet.

Making the connection The so-called life-affecting revolution takes more than simply adding modems and browsers to wireless devices. It requires a link between the mobile network and the Internet that lets applications find people at any airport, halfway down any block or anywhere in the building (even at one's desk).

This link also must let applications know whether a given person has the mobile phone turned on or is using it. And this link must secure the network from harm from any application that will be using the network to deliver services to users.

The link, or gateway, thus has three important tasks: giving the application the user's exact geographical location, indicating whether the user is present on the network and providing a sort of fire-wall to protect highly secure customer data within the wireless infrastructure.

Here's how such a gateway might work: While using a browser, the user pushes a button on her mobile device that has been programmed for a geolocation service and indicates through menu choices a request for the nearest automated teller machine. The call goes through the radio base station to the mobile switch, which authenticates the user. Then the switch sets up either a circuit or packet link (depending on what's available in that particular network) to interworking function software that converts the signal into TCP/IP protocol for transmission to a WAP application server. The WAP server directs it to the geolocation application, which maintains a list of automated teller machines - but it needs to know where the caller is. So the application software asks the gateway for the caller's location, sending the request through an application-specific interface known to the application and the gateway.

When it receives the request, the gateway checks the application's credentials, making sure it is authorized to provide services on this particular mobile network and has permission from the user to receive information on the user's whereabouts.

Next, the system could use a proprietary language to ask the switch for the user's longitude and latitude. This proprietary language isolates the network from the application, serving as a firewall to keep hackers or badly written applications from affecting the network. The gateway then forwards the location data to the application, which polls its database for automated teller machines within, say, a mile of the user and sends the addresses back to the gateway, which forwards them through the network to the user.

This is the basic pattern for any WAP-based application. And despite the apparently large number of interactions, simple WAP transactions that do not require graphics - can travel at warp speed through a second generation or 2.5G network. They don't need third generation bandwidth. With 3G, of course, the application could quickly send a map with automated teller machines highlighted.

A gateway located between the mobile network and Internet applications also could process Web pages formatted for mobile phones by standards other than WAP. No matter what the Web page format, the architecture for service delivery remains the same.

Signals travel from mobile unit to base station over any air interface; from base station to mobile switch to an interworking function via frame relay, ATM or time division multiplexed circuit-switched channel; and from there on TCP/IP, including the link to the gateway.

Many advantages accrue to a network architecture linking the mobile infrastructure and the Internet by this type of gateway. Adding services is easy - a matter of programming the gateway to recognize and authorize the new application and to supply the application provider with an application programming interface. Changing mobile Web page protocols is easy - another bit of reprogramming. A higher transmission speed such as 3G doesn't change the basic gateway; it, too, requires just a software change. The architecture, and the gateway platform, can evolve.

Buddy-buddy Buddy groups belong to another class of application, one that requires knowing whether a user's phone is on and/or perhaps in service. But although they're increasingly popular in North America among subscribers to America Online and Yahoo, they're confined to wireline users. Wireless buddy groups should be a wide-open opportunity, quickly gaining users and running up minutes of use.

Buddy lists, of course, have uses beyond teenage companionship. Business travelers can see instantly which colleagues are reachable by mobile phone, which already are talking/transmitting on their phones and which are online from conventional computers.

If a sales rep needs to check a question with a technical assistant or a product manager, the buddy list identifies who can be called immediately, and instant messaging can make questions and answers easy - even if the called party is talking to someone else.

Buddy lists and instant messaging can even bring together teams widely scattered geographically. One benefit of the gateway is that it transcends wired and wireless boundaries. Co-workers can be brought together in a buddy group even though one may be using a home PC; another, a wired phone at the office; a third, a mobile unit on the road.

In introducing mobile Internet applications, time to market will be crucial. Early market research about users will be invaluable for service providers; for example, fast user acceptance will depend on the user experience being compelling, uncomplicated and inexpensive. The terminal device - phone, pager or other - will need to be intuitive. Marketing will be important for both enterprise and individual customers, so providers should be willing to expose their customers to a wide variety of Internet-based applications and content.

But getting to market quickly with the right services depends on each member of the value chain. Perhaps as never before, the right partners can make or break success.