More than just black and white lines: Barcodes gaining a foothold in domestic wireless market

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Few mobile offerings have a longer – or more uninspiring – history in the United States than barcodes. But the odd-looking little images may finally be going somewhere.
One of the first consumer-facing mobile barcode applications in the United States came to market about 10 years ago, when GoAmerica Communications Corp. began testing a service that allowed wireless consumers to comparison-shop from Internet-enabled phones. But mobile barcodes stumbled out of the gate thanks to a host of challenges including poor MMS interoperability and a lack of feature-rich phones.
“I think the real roadblock has been people purchasing phones that don’t have WAP capability,” according to Fred Boos, CEO of RocketBux Inc. “When we first started, we only had something like 7% of phones that had WAP capability and people using it. Something like 58% of phones that are sold today have data plans.”
A Bend, Ore.-based startup that develops mcommerce offerings, RocketBux last week launched its first public barcode service with the Mt. Bachelor ski resort. The company sends ski conditions via a daily text alert to roughly 1,000 winter sports enthusiasts; a link at the bottom of the alert directs users to a barcode coupon that can be redeemed on the mountain.
Boos said he couldn’t disclose exact figures, but the effort has resulted in “good conversion rates,” and the company plans to expand the service to other Bend-area merchants.

More acceptance overseas
Mobile barcodes are nothing new in many overseas markets. Some consumers in Europe and Asia have grown accustomed to flashing their phones to pay ticket fares or receive discounts, and some programs allow users to snap a picture of a barcode – from a poster, for instance, or CD jacket – and send the image via MMS to receive mobile content or marketing information.
Verizon Wireless last year issued tickets to the Tribeca Film Festival via MMS that were scanned at the theater. Continental Airlines is issuing boarding passes in the form of barcodes at Houston’s Intercontinental Airport. And Sprint Nextel Corp. is pushing ScanBuy’s technology with a major marketing effort, including a full-page in December’s Wired Magazine.
One players in the 2-D barcode space, ScanBuy’s business contrasts starkly with the year-old startup Rocketbux. Instead of pushing barcodes to phones, ScanBuy’s flagship product – dubbed ScanLife – is a downloadable application that reads mobile barcodes placed in magazines, on billboards or on television shows. The codes can prompt the phone to automatically download content, access a wireless Web page or simply enter information in a phone’s calendar or contacts.
“The problem the carriers are having is, ‘How do we get people to use the mobile Web specifically?'” said ScanBuy CEO Jonathan Bulkeley. “‘How do we simplify navigation and make it easier for people to use the mobile Web?’ This is one of the big answers.”
CTIA last month announced a formal request for information for cameraphone barcode scanning, and the GSM Association and the Open Mobile Alliance recently agreed to help develop standards for mobile barcodes.
Whether a standard is needed for mobile barcodes is unclear. Much of the recent activity has been centered on 2-D codes – images that look a bit like a checkerboard, with squares blacked out seemingly at random. RocketBux’s technology uses 1-D images, however – the same barcodes that are printed on milk cartons and CD cases.
But while 1-D barcodes are easily adaptable for mobile use, the images can’t be read by most cameraphones without a special lens attachment. Two-dimensional codes can be scanned by most wireless handsets, but there are a few kinds of 2-D codes in use (QR Code and DataMatrix are others), potentially leading to a fragmented market.
The use of mobile barcodes has taken off in Japan, Bulkeley said, where the market has settled on a single format.
While mobile barcode readers require a specific application – either downloaded or embedded – RocketBux’s barcode coupons can be accessed over the wireless Web without any additional software, and then read at the point of sale. Boos hopes that simplicity sets RocketBux apart in what are still the early days of mobile barcodes.
“We’re just trying to keep it very, very simple,” Boos said.
Meanwhile, ScanBuy’s Bulkeley hopes the little Rorschachs are placed on everything from cereal boxes to public signs. The company looks to spur uptake of the mobile Web, cashing in by sharing advertising and m-commerce revenue with carriers.
ScanBuy’s business model “depends on the market,” said Bulkeley, “but in the U.S. we partner with the carriers. . What I think is going to happen in mobile is that everything goes flat-rate. Then ad revenue kicks in and starts to provide margin and revenue for the carriers.”

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