Sprint PCS, one of the most prominent wireless data services, said yesterday it is looking for business customers to drive wireless Web adoption over the next few years. Other carriers say that business clients will bolster a consumer market that is still struggling out of its infancy.
"We're seeing a major effort shifting toward a business focus at (Sprint) PCS," said John Garcia, senior vice president at Sprint's wireless division. "We want to accelerate people's acceptance of the phone as a data device. We think business usage will drive that."
Sprint is still heavily committed to the consumer market, Garcia noted, but does expect the bulk of its data revenues to come from business for the next few years. It will join competitors like AT&T, which has had a business-focused component to its data PocketNet service for several years, and Nextel Communications, which has more of a business focus than any other wireless carrier.
While analysts say the business market is a good place to look for revenues, not all are convinced that it will be the spark that finally sets off wireless data adoption in the United States.
"In order for wireless data services to take off, there has to be end-user addiction," said Jane Zweig, executive vice president of Herschel Shosteck Associates, a wireless consulting firm. "That comes from the mass market, not from the (business markets)."
The service providers are struggling to close a gap between the massive hype that has characterized the wireless market in recent months and the reality of low adoption rates among actual consumers.
In Japan and in regions of Europe, even rudimentary Web browsing over mobile phones has been warmly embraced by the mass market, driven by a larger array of available content, simple pricing plans, and a lower relative availability of personal computer-based Internet access. In Japan, NTT DoCoMo's iMode data service has been attracting more than 100,000 new subscribers a week since last year, for example.
Hard numbers for data services are limited in the United States, but most analysts say usage is still slim. Garcia said yesterday that adoption rates for Sprint's wireless data services are on target but range in the "low double digits" for new subscribers.
Meanwhile, business wireless data services have been in operation for some time. Every UPS driver has a wireless data pad used to connect to the company's central tracking system, analysts note. Other companies, such as trucking or dispatch firms, also use this less-sexy version of a wireless Internet.
Sprint tipped its hand yesterday with a broad new collection of services geared specifically at the business markets. Deals with Wireless Knowledge and several other providers will allow callers to check their office email and tap into internal office databases and contact lists. The services aren't unique on the market but are Sprint's first major foray into the area.
Garcia said the company is preparing a major marketing and advertising campaign--scheduled to launch in September--around its business services.
For the most part, analysts have applauded the move to offer as many business services as possible, noting that revenue streams in that market could be more stable.
"Businesses can justify spending money to give their employees wireless phones, if at the same time they're giving them access to email and other applications," said Adam Zawel, a wireless data analyst at The Yankee Group.
But can business services serve as a spark to the wider wireless market? That's still far from clear.
AT&T representatives say the company's initial PocketNet service has been focused on business since 1997. But now the company is looking for the consumer market to drive adoption rates just as quickly, a spokeswoman said today.
"We are seeing parallel development in the business and consumer markets, as one is supporting the other," said spokeswoman Danielle Perry.
Analysts note that business applications, although they are becoming more sophisticated, do have hurdles that aren't as much of a danger in the consumer market.
The technology does come with some security questions, although the carriers have downplayed these issues. But if any questions remain outstanding, corporations aren't likely to trust their confidential email and internal data to the networks, analysts say.
Moreover, the simpler issues of poor interfaces and slow connections continue to hamper the carriers' services, even if they have made some changes that have improved both problems.
"No matter how good the applications are, you still have the limitations of the networks and the devices," Zweig said. "That's not going away soon."