The same wireless software companies that once offered their goods for free to individual cell phone owners are now selling souped-up versions of the same software to businesses, analysts and industry watchers say. For instance, one company that created a way to send e-mails reminding a cell phone owner of an upcoming birthday now sells a more powerful version to businesses, hoping they will use the technology to send reminders about upcoming meetings or important conference calls.
This shift is an important, make-or-break attempt to turn a profit for the growing number of companies that create software that powers e-mails to cell phones, or mobile games, for example, analysts say. The recent drop-off in handset sales, plus the drying up of venture capital investment, is powering the shift.
But the trend also has an ominous parallel to the death throes of many of the Internet's more infamous dot-coms. In last-ditch efforts before shuttering, many dot-coms tailored souped-up versions of their products to businesses.
"Everybody can't make money targeting consumers," said Dale Gonzalez, vice president of research and development at Air2Web, which creates a way for carriers to offer wireless Web access for cell phone subscribers. The company just introduced software designed to take advantage of this trend.
"You can't do it anymore just to get your name out, just to say you have more eyeballs," Gonzalez said.
At least two U.S. carriers have jumped on the bandwagon. Verizon and Sprint recently signed a deal with the Qualcomm/Microsoft partnership called Wireless Knowledge that will let the carriers offer a corporations' employees a way to access corporate e-mails and databases using wireless devices such as cell phones or personal digital assistants.
Rogers AT&T Wireless, which serves 2.6 million wireless subscribers in Canada, inked deals with software maker Infowave Software so it can offer wireless e-mails and other business functions to businesspeople.
Some private companies are also getting into the game. One of the largest recent deals involved Lockheed Martin Global Telecommunications. The company sells software for wireless access. It just announced a deal with wireless software maker 2Roam. The companies said the goal is to make its offerings more attractive to a businessperson.
Jeff Hanson, a senior vice president of marketing with 2Roam, said companies like Hertz and Best Western, which were using wireless products to lure in customers, have begun using the same technology for their employees. Some hotels use wireless check-in, which saves time and cash, he said.
Two months ago, Swiss airlines Swissair inked a deal to use a 2Roam product to help its pilots and flight crews learn about schedule changes, he said.
"Originally, the wireless climate was viewed as a way to increase revenue," Hanson said. "But now the idea is to deploy a wireless application as a way to decrease costs."
Analysts at technology consultants The Yankee Group believe that one particular group of wireless companies, those offering Instant Messaging over cell phones, were among the first to shift their focus. The wireless IM industry is very young, with a mix of start-ups and existing players like America Online and Yahoo first targeting mainly the 18-to-24-year-old set. Now, some in the industry are adapting their products as a way for businessmen and women to collaborate on a project, analysts said.
"It soon became apparent there wasn't a lot of cash in going after consumers," said Roberta Wiggins, The Yankee Group's director of wireless mobile solutions. "It was too early; the technology was not at that stage yet where it could have a mass-market appeal."
Ben Donnelly, a research analyst with wireless watcher Frost & Sullivan, wrote in a recent study that "many operators should concentrate on the corporate world," and that carriers already are shifting their focus.
There could also be some relatively large amounts of cash if the industry does continue on its new path. Frost & Sullivan predicts the number of workers using wireless gear in Europe alone will rise from 21 million last year to about 34 million by 2006. Revenue will increase tenfold, however, from $700 million in 2000 to $7 billion by 2006.
A recent study by Telephia, one of the few analyst firms specifically dedicated to the wireless industry, said carriers might be mining a rich vein. The survey suggests that businesspeople are twice as likely to spend at least $40 per month on data services than any other type of cell phone owner.
"It used to be reaching someone meant cash in your pocket. But now there's this realization all the people have been reached, that it's not making them money," Gonzalez said.