Wireless

SAN FRANCISCO--In what looks like an attempt to compete toe-to-toe with Apple's iPhone, Research in Motion announced a slew of new integrated application deals on Thursday to make its e-mail-optimized smartphone more appealing to consumers.

E-mail was the killer application that catapulted RIM's BlackBerry device into near cult status in the corporate world. And now the company is trying to win the hearts and minds of consumers, not only with new phones--like the flip-style Pearl 8220, which was announced on Wednesday, or the BlackBerry Bold, which recently launched in the North American market--but it's also loading BlackBerry devices with what its co-CEO Jim Balsillie called "lifestyle" applications.

On Thursday, here at the CTIA fall 2008 trade show, the company made a series of announcements about different applications it's customized for BlackBerry devices.

This is not the first time that RIM has announced special relationships with specific application developers. At last year's CTIA Fall trade show, it announced it had integrated the Facebook application into its platform. Balsillie said during a keynote address here Thursday that the Facebook for RIM application, which launched about a year ago, has been downloaded 2.5 million times.

"It's been the fastest take up of any application that we've ever had," he said.

But now RIM has upped the ante adding a slew of new customized applications for its smartphones including: a deal with Microsoft to integrate search, MySpace to provide quick access to another social-networking site, TiVo to offer remote scheduling and browsing to a DVR, Ticketmaster to buy concert and event tickets on-the-go, and Slacker to offer a music library for BlackBerry users.

Here's a closer look at the announcements.

Microsoft mobile search
RIM has integrated the Microsoft Live Search engine into the BlackBerry Browser making Microsoft the default search engine for BlackBerry devices. The mobile search platform will let BlackBerry users get contextual, location-based search results or look for nearby points of interest, such as restaurants or movie theaters, from inside BlackBerry Maps.

Availability: Microsoft Live Search for BlackBerry smartphones is expected to be available later this year with support for multiple languages.

Separately, Google announced earlier this week that it's launched Google Mobile App for BlackBerry, a free download that offers faster search and a slew of Google services for BlackBerry devices. The new mobile application gives Blackberry users Google Apps support, a search history, software update alerts, and easier access to Google programs like Gmail, Maps, and News.

TiVo
RIM is also working with TiVo to allow BlackBerry users to search recordings on their TiVos and schedule future recordings while on-the-go. In the future, Balsillie said that BlackBerry users will even be able to view recorded shows on their BlackBerrys.

Availability: The first software application from RIM and TiVo is expected to be available later this year.

MySpace
First it was Facebook, and now it's MySpace. RIM will now offer customized access to the popular social-networking site, including instant, push-based messaging to BlackBerry and MySpace users, real-time status and mood updates, camera integration, and optimized photo management. Also as part of this collaboration between the two companies, RIM has created a BlackBerry community page on MySpace for users to access BlackBerry smartphone, content, videos, games, ringtones, skins and other features.

Availability: MySpace for BlackBerry is expected to be available globally in October.

Ticketmaster
RIM has also teamed up with Ticketmaster making its BlackBerry phones the "Official Smartphone of Ticketmaster." What this means is that BlackBerry users will be able to browse, search, and purchase tickets to live concerts and events from their phones. BlackBerry users will also be able to browse music and sample cuts. And they'll be able to sign up for e-mail alerts to get information about upcoming music and sporting events.

Availability: The deal with Ticketmaster is exclusive to the United States, Canada, and the United Kingdom. And the application will be available by the end of the year.

Slacker music
BlackBerry isn't likely the first smartphone most people think of when they think music, but RIM is looking to change that. RIM has partnered with the streaming Internet radio music site called Slacker, which allows people to create and stream customized music channels, to offer a new music experience for BlackBerry users. The music can be streamed or users can store up to 1,000 tracks on their phones so that they can listen to music even when they're not connected to the network. Balsillie said that the device automatically syncs to the music site when users enter a Wi-Fi hot spot.

Availability: The Slacker-optimized application will be available sometime in October.

SAN FRANCISCO--Nearly half of kids age 8 to 12 years old own cell phones in the U.S., in what could be the next big cell phone demographic for the mobile industry, according to a Nielsen report released here Wednesday at the CTIA Fall 2008 trade show.

Nielsen says that 46 percent of the 20 million young consumers known as "tweens" are using mobile phones. On average kids get their first cell phone between the ages of 10 and 11 years old. About 55 percent of tweens, who own cell phones, send text messages and 21 percent download ringtones.

The main reason these kids have phones is because their parents want them to have them in case of an emergency or problem. But about 92 percent of those surveyed said they restrict how tweens use their phones, with 69 percent of them prohibiting the download of games and ringtones, which typically incur charges. Roughly 65 percent of tweens with phones get cell phone service through family plans.

As cell penetration approaches 85 percent in the U.S., cell phone operators are looking toward younger consumers to drive growth. And operators are focusing more effort in figuring out what is needed from this often difficult to survey group of consumers.

"Tweens have grown up with mobile phones and expect them to do much more than make a call," Richard Wood, a vice president for Nielsen Mobile said in a statement. "Our clients want to understand tweens' attitudes and mobile behavior in the context of their daily life and media consumption."

But tweens aren't the only young demographic that the mobile industry is interested in targeting. On Friday the CTIA will feature a session at its fall trade show here that will provide results of a national survey of thousands of American teenagers. It will also provide a live panel of 13- to 19-year-olds, who will discuss how they use wireless. So stay tuned for more on those results later this week.

SAN FRANCISCO--Despite a 100 percent price increase over the past couple of years, SMS text messaging usage is exploding in the U.S.

American cell phone subscribers are sending more text messages than ever, according to a recent survey released here Wednesday by the mobile industry's trade association CTIA. About 75 billion SMS text messages were sent in June, averaging about 2.5 billion messages a day, the report said. This represents an increase of 160 percent over the 28.8 billion messages reported in June 2007.

Short message service, or SMS, text messaging first became popular in Europe and Asia, because it was much cheaper to send these short text messages than make an actual phone call. In countries such as the Philippines, the cost of sending one text is less than one penny. And in Europe where cell phone users are still penalized with high roaming charges between countries, texting is still a more economical form of communication.

But that's not the case in the U.S., which has seen the price of sending and receiving individual text messages skyrocket 100 percent over the past two years to 20 cents a pop. Sprint Nextel was the first to introduce the new 20 cent per text message rate last year. And other major carriers, such as AT&T, Verizon Wireless, and T-Mobile USA, soon followed.

The new wave of price hikes came just one year after all the major carriers raised individual text messaging rates from 10 cents a message to 15 cents per message.

So what's with the 100 percent price hike in two years? Well, there's nothing that has changed in terms of the cost associated with delivering this service. In fact, text messages cost carriers very little to transmit. And when compared with what carriers charge for transmitting other data services, such as music downloads or surfing the Web, the text messaging rates seem exorbitant.

Despite the rising price of texting, U.S. subscribers are using the service more than ever. And the combination of higher prices and heavier volumes of text traffic are driving enormous profits for carriers. In fact, CTIA also reported Wednesday that data services, which primarily consist of text messaging service, generated $14.8 billion in revenue for the first half of 2008, or accounted for about 20 percent of total mobile carrier revenues. This represents a 40 percent increase over the first half of 2007, when data revenues totaled $10.5 billion.

The big profits and high price hikes have raised eyebrows among some lawmakers in Washington, D.C. On Tuesday, Sen. Herb Kohl (D-Wis.), who is chairman of the Senate Judiciary Antitrust Subcommittee, sent letters to Verizon Wireless, AT&T, Sprint-Nextel, and T-Mobile USA, expressing concern over the 100 percent increase in texting rates since 2005.

"What is particularly alarming about this industrywide rate increase is that it does not appear to be justified by rising costs in delivering text messages," Kohl's letter said. "Text-messaging files are very small, as the size of text messages are generally limited to 160 characters per message, and therefore cost carriers very little to transmit."

The senator from Wisconsin suggested in his letter that the price hikes are related to industry consolidation, which has reduced competition and put more control in the hands of four major carriers. He also asked all four of these carriers to provide evidence of the factors that led to the price increases.

It will be interesting to see what justification the phone companies come up with for the price hike. But even though the price of the service has increased dramatically, the fact that usage is growing as quickly as it has suggests that the actual 20 cent per message price is not more than the market can bear. Of course, as a consumer it's frustrating to have to pay more for a service that I know costs next to nothing in other countries. It's also frustrating to know that carriers are making big bucks off a service that really costs them nothing to provide. I guess, at least for the moment, mobile operators have found themselves a goose that lays golden eggs.

SAN FRANCISCO--RealNetworks is adding video to its interactive voice response feature, which will let mobile operators incorporate a video interface for finding information, content, and entertainment.

The company announced the new service here on Wednesday at the CTIA Wireless Fall 2008 trade show. The service, which mobile operators will subscribe to and offer to their subscribers, will be available to customers already subscribing to an operator's video telephony service.

Video telephony is a service that's been envisioned almost since the phone was invented. It allows operators to add video to real-time voice chats between two people using the voice part of the mobile network. Until 3G came along, video telephony would have been impossible because it uses so much bandwidth. But with higher-capacity 3G networks, mobile operators can offer video services. And RealNetworks' service offers a new twist on the traditional idea of video chat.

The new RealNetworks service will work as follows. Operators will deploy the service in their network, and subscribers with video-calling plans and video telephony capable phones will simply dial a phone number, such as 411, or say "information" if the service is voice-activated. They'll then be presented with a menu of visual options, like movie trailers and times, traffic, music, and shopping.

Because the interaction takes place via a video call session, operators can add a video-calling plan as an extension of a voice plan, adding another potential revenue stream for operators.

"Everyone knows how to make a phone call," Vern Poyner, a senior vice president, for RealNetworks, said in a statement. "And by offering this new feature via video telephony, we believe it will help operators see a return on the significant investments they've made in deploying 3G networks."

SAN FRANCISCO--The wireless Web has prompted mobile operators to change their tune about open networks, but don't expect the mobile market to be as open as the PC Internet anytime soon.

CEOs from three of the big four wireless operators in the U.S. took the stage during a keynote panel at the CTIA Fall 2008 trade show here Wednesday to discuss what they envision for open cell phone networks. While Robert Dotson of T-Mobile USA, Dan Hesse of Sprint Nextel, and Lowell McAdam of Verizon Wireless all agree on the importance of opening their networks to developers and allowing subscribers to access the mobile Internet freely, the executives still say mobile operators need to have some control over which devices come on their network.

"If you look at unfettered access on the network, all of us would agree that it's a pretty poor experience for users," T-Mobile's Dotson said. "There needs to be some stewardship or control."

T-Mobile is expected to be the first carrier to launch later this month a phone using Google's open-source operating system, Android.

Dotson further explained that as a GSM carrier, open access for devices has existed on T-Mobile's network from day one. People can buy unlocked phones and simply put in their T-Mobile SIM card for service. But he said there were advantages and disadvantages to this freedom, noting that customers who bring their own unlocked devices to the network have a "less than good experience."

"If you don't optimize the phone to make sure there is network integration when you send an MMS or e-mail it might not work well," he said. "Even though on the outside (an open device network) looks enticing, there still needs to be a minimum level of control to safeguard security and privacy."

Verizon Wireless' McAdam agreed. The company launched its Open Network Initiative almost a year ago. But even though the network is supposed to be open to any device, what Verizon is really doing is speeding up the certification process for device makers and application developers. McAdam showed off the first cell phone that is a product of the initiative, a $69 phone from prepaid service provider AirVoice. He said the device is commercially available, but he didn't elaborate on availability on the Verizon Wireless network or the pricing of the service.

McAdam emphasized that Verizon's open strategy, at least toward developers, means that the operator can bring more innovative devices, applications, and services to consumers much faster.

"There is an innovation tidal wave occurring right now," he said. "People making applications for the desktop want to move to mobile phones. We couldn't handle all that innovation into our business, so opening the doors, and still protecting the network, is the only way we have to this."

Sprint's Hesse admitted his company is still working on providing more openness for devices. But he said Sprint has a new speedier device authorization program under way for its 3G, or third-generation, network, noting that the operator is providing service for devices like Amazon.com's Kindle. He also said that Sprint is working on an open platform for application developers.

He said true openness will come with the company's new 4G WiMax network, which it is building with Clearwire.

"From a device perspective, we still have a ways to go," he said. "Really 4G and the embedded chip model for WiMax will allow people to bring whatever device, a laptop, camera or whatever to the network."

But Verizon's McAdam pointed out that offering more device openness will also mean higher prices for consumers.

"We've conditioned customers by putting very expensive computers in their hands for very few dollars," he said. "And now we're giving them the option to walk into a store in an open environment and pay more for a device. It will be a big transition."

That's why McAdam predicts that only 20 percent of customers will rapidly adopt the open model versus consumers who would rather take the phone subsidy in exchange for a contract. If Verizon and others can provide a decent experience on a more open network, more will follow, he said.

T-Mobile's Dotson agreed and said he expects the majority of T-Mobile's customers to buy traditionally integrated mobile devices.

"The BlackBerry is not an open platform," he said. "But it has a phenomenal e-mail experience. And there will continue to be a role for that seamless hardware integration that provides a great experience and richness."

But John Stanton, who founded Voicestream and Western Wireless, cautioned these CEOs in a later panel discussion with Craig McCaw, the current chairman of Clearwire and founder of McCaw Cellular Communications, that moving too far toward an open network will commoditize the wireless industry and significantly drive down profits. He said that operators need to focus on developing innovative services themselves. And they need to own content instead of letting others like Google or Yahoo do it for them.

"When you become a pure access provider in a saturated market, you grow at the rate of the economy," he said. "U.S. operators are running the risk of turning into commodity businesses instead of global content businesses with innovation that delivers higher profits."

Updated at 3:50 p.m. PDT with further detail and information about Blueprint programming tools for mobile devices.

SAN FRANCISCO--Yahoo on Wednesday released a preview version of a free new iPhone application called OneConnect that can centralize communications and social-networking activity.

"OneConnect allows everybody to keep connected to the persons they care about. It's a socially connected address book," said said Marco Boerries, executive vice president, Yahoo Connected Life, in a speech here at the CTIA Wireless show. "The address book now comes to life."

Yahoo is racing against Google and others to bring more applications to mobile devices in an effort to tap into the growth of mobile Internet use. Previous Yahoo applications such as OneSearch and Go compete against Google applications including Gmail, Search, and Maps.

One feature of OneConnect, called Pulse, "allows you to tap into everything going on with your friends," Boerries said. It pulls a news feed from "Facebook, MySpace, Bebo, Last.fm--all the leading social networks--into one aggregated view."

A related "Favorites" feature lets people track or quickly contact the handful of people in a user's inner circle.

Another feature provides a unified hub of instant messaging, SMS messages, and e-mail.

OneConnect will be released in the U.S. initially, but "toward the end of the year will branch out to the rest of the world," Boerries said. Also coming will be versions for other phones. "The other ones will follow soon shortly," including BlackBerrys, Windows Mobile, and Nokia Series 60 phones, he said--but not for the Palm OS-based version of Treo phones.

Google, meanwhile, had its own news. It announced a new version of its Mobile App for BlackBerry users. This software lets people search the Web, with a boost from search suggestions and previous search history, and get links to Google Docs stored online. The company already had an iPhone version of Google Mobile App.

Monetizing mobile
Why all this attention to mobile devices? Because Internet companies are looking for growth, and the mobile phone arena is one place where that growth is spreading now that networks can transfer data as well as handle voice calls. Yahoo expects to make money through sales of advertising, not service fees, Boerries said.

And mobile ads have personalization potential missing from those on computers, he said in an interview after his speech.

"We believe that because of the inherent personal nature of the mobile device," such as location information, "we should see significantly greater CPMs or CPCs," he said, referring to the cost per thousand impressions by which display ads are sold and the cost per click by which search ads are sold.

Blueprint's footprint
Yahoo also announced Wednesday it's increasing the profile of its Blueprint software foundation for developing mobile phone software. Blueprint consists of a "runtime" foundation tuned for each supported mobile device and software components programmers can use to build applications that run on that foundation.

Previously, Blueprint could only be used to develop "widget" applications that would run within the Yahoo Go mobile phone software. Now, though, it can be used to develop standalone applications that anyone can develop and distribute, Boerries said. Programmers wishing to do so can set their download sites so they transparently take advantage of Yahoo's back-end service to identify what phone a user has and to supply the appropriate Blueprint runtime, he added.

Blueprint also works for developing software on an Apple iPhone--as long as you're a Yahoo programmer. "We are currently in discussions with Apple as to how we can work to make that available to other developers, but right now it's only used inside Yahoo," Boerries said.

The software is designed to ease the development difficulties of ensuring compatibility with hundreds of different devices.

"It's insane," Boerries said of the profusion of devices. "I do believe it'll be somewhat chaotic for the foreseeable future because of the size of the market. Blueprint hides that complexity."

Sun Microsystems, along with allies such as Motorola, has tried to accomplish much the same simplification through use of its Java software. Blueprint takes a different approach, though: instead of trying to provide interfaces that will make an application appear the same on every device, Blueprint tries to take advantage of what each phone can offer, so more sophisticated devices get more sophisticated options, he said.

SAN FRANCISCO--Nokia took aim at smartphone rival Research in Motion Tuesday with plans to expand the number of devices that will automatically be capable of accessing Microsoft corporate e-mail.

On the eve of the CTIA I.T. & Entertainment tradeshow here, Nokia announced it will embed Microsoft Exchange Activesync on all Nokia phones that use the S60 Symbian operating system. As a result, 43 different models of Nokia phones will have easy access to Microsoft corporate email. Nokia will also add the Microsoft Exchange support to all new N-Series and E-Series phones that hit the market in the future.

Until this announcement Nokia offered Microsoft email support as a download for only a handful of devices. But the feature wasn't well publicized, and it was somewhat difficult to download.

Now Microsoft's ActivSync software will be automatically available for 80 million of Nokia's already shipped devices, and it will be available as a standard feature on all new Nokia N-Series and E-Series phones. Having the software embedded on the phone or as an automatic software update makes setting up corporate email access on a Nokia phone so easy that most people can do it themselves without the help of their IT department, said Bill Plummer, vice president of sales and go-to-market for Nokia Americas.

The enhancement is a big deal, especially in the U.S., where Nokia has not made significant traction in the smartphone market. Instead, Research in Motion has dominated the smartphone category in the U.S. with its BlackBerry devices.

The integrated Microsoft email support will now make Nokia a more appealing choice for corporate users. But winning over corporate customers may still be difficult. Nokia rivals such as Palm and Motorola , already have ActiveSync available on their smartphones, and BlackBerry continues to beat these companies. Apple has also introduced Microsoft ActiveSync for its iPhone users.

What's more, most of Nokia's phones that will offer the embedded e-mail software are not sold through carriers in the U.S., which means they aren't subsidized. And with price tags in the range of $450 to $950, Nokia smartphones could be out of reach of some U.S. consumers, especially when all four of the major U.S. carriers offer subsidized BlackBerry's for around $100.

SAN FRANCISCO--Mainstream U.S. wireless-phone subscribers are finally using the mobile Web, and everyone from handset makers to mobile operators to application developers to advertisers is gearing up to get a piece of the action.

The growing trend is likely to be a hot topic at the CTIA's Wireless IT & Entertainment trade show, which kicks off Wednesday and runs through Friday at the Moscone Convention Center in San Francisco.

The show, which follows the industry's big gathering in the spring, is expected to attract more than 15,000 attendees, with some 250 companies exhibiting at the show.

The fall CTIA is really a show with dual personalities: one catering to a corporate information technology crowd and the other geared toward entertainment and advertising executives. This mix makes pulling out one central theme a bit of a challenge. But if a theme does exist at this year's show, it's likely that the mobile Web is finally taking off in the United States.

Out of the more than 255 million mobile-phone users in the States, more than 40 million actively use their handsets to surf the Web, according to Nielsen Mobile, which provides consumer research on the telecommunications and mobile-media markets. Nielsen analysts say the mobile Internet has hit a critical mass in the States, but it still has a lot of growth ahead of it.

Growth in the mobile Web is largely being fueled by faster networks. The major domestic cell phone operators have mostly completed building their 3G networks, with the exception of T-Mobile USA. And some, such as Sprint Nextel, are already moving on to a fourth-generation network.

As the 3G network footprints expand, and 4G services come online, users will get an even better surfing experience on their phones, which will lead to more adoption.

Craig McCaw, chairman of new nationwide WiMax network Clearwire, will be one of several speakers taking the stage Wednesday. Clearwire announced earlier this year that it's merging with Sprint Nextel's WiMax division. The venture has gained financial backing from major cable companies, as well as from Google and Intel. McCaw will likely give an update on the planned acquisition and talk about how his company has been growing its current WiMax service.

While faster networks are necessary to spur mobile Web usage, it's not the only element that's important to drive adoption. New multimedia and Web-capable phones that can operate on these faster networks are needed, as are new applications. To spur faster adoption, carriers have been talking about opening up their networks to get new devices and services on their networks more quickly.

During the opening keynote on Wednesday, CEOs from three of the top four wireless operators in the country will talk about how they are making their networks more open. Lowell McAdam, CEO of Verizon Wireless; Robert Dotson, CEO of T-Mobile USA; and Dan Hesse, CEO of Sprint Nextel will sit down together in a panel discussion.

Also on Wednesday, Marco Boerries, executive vice president of Connected Life at Yahoo, will take the stage for a keynote address to talk about Yahoo's mobile initiatives. Although it's still early to call the major players, Yahoo has been positioning itself as a dominant player in the mobile market. Its Yahoo Mail is the most used site on the mobile Web, with 14 million unique visitors a month as of May 2008, according to Nielsen Mobile.

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