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Motorola takes 4thpass

The handset and equipment maker plans to use 4thpass' products to fill out its struggling line of software for selling downloadable games and other applications.

Motorola bought wireless software maker 4thpass on Monday to bolster its struggling line of telephone network software for selling downloadable games and other applications, a Motorola executive said.

The 4thpass software will become part of that line, called Motorola's "Mobile Services Caf?," which the handset and telephone network equipment maker began selling to wireless carriers last year, said Scott Durchslag, vice president of strategy and business development at Motorola's handset division .

Critics say Motorola's Caf? didn't have enough on the menu to compete with 4thpass, Ericsson or other makers of downloadable software that a growing number of carriers use to sell applications such as games and ring tones. Most carriers have built high-speed networks and have begun selling wireless downloads to customers, starting with Nextel Communications last year.

For example, Motorola's caf? didn't have the sophisticated billing software that 4thpass created to ensure the software developers got paid for the downloads. 4thpass' software also lets customers "try before they buy" by playing a downloaded game before committing to purchasing it, while Motorola's does not.

"Honestly, they do it a lot better," Durchslag said.

"Historically, Motorola has never been known for writing great applications software," said Alan Reiter, president of an industry consulting company called Wireless Internet & Mobile Computing. "They've had problems ever since cellular existed." For example, Reiter pointed to the number of customers Motorola has for its Caf? software since its introduction a year ago: just one carrier. By contrast, software from 4thpass runs download services by Nextel Communications, Telefonica Moviles in Spain and LG Telecom in Korea.

4thpass is one of a number of companies that have been using Java for cell phone download services. Java is software developed by Sun Microsystems that lets programs run on a number of computing devices without having to be rewritten for each one. For example, the Java version of a video game running on a Motorola cell phone with an ARM microprocessor could run just as well on a BlackBerry pager from Research In Motion with a different chip.

The Java programming language was built on the premise that a program written in it can run on any platform that has a Java Virtual Machine. This works to varying degrees on PCs and servers. But as more and more phones reach the market with Java virtual machines built in, it is becoming apparent that the cross-platform benefits of Java simply do not apply here in the same way, developers have recently complained.

Ken Dulaney, a wireless analyst with Gartner Dataquest, said the Motorola deal is another sign that carriers are "building their own proprietary systems for Java," to which developers have to tune their software.

"What everyone seems to have done is customize it to their own environment," he said.

Motorola paid more than $20 million for 4thpass, a 4thpass source said. Investors Nextel Communications, Investcorp and OVP Venture Partners received compensation and are no longer part of 4thpass. Additional terms of the deal were not disclosed.

"All of our investors got big returns. No one is upset," said 4thpass Chief Executive Mazin Ramadan.