In what has been called primarily a preening gesture for Mannesmann AG shareholders, Vodafone AirTouch plc announced plans last week to launch an Internet portal designed for wireless Internet and mobile data services, delivering data, audio, graphics and video to wireless devices.
The company expects to release version 1.0 of the portal in July in North America, Europe and Australia. It will carry its own individual brand, to be announced upon commercial launch. Vodafone AirTouch said it would make the portal available to all network operator partners, as well as license it to carriers in other markets where applicable.
The platform will be designed as a single global unified delivery platform, the company said. Version 1.0 will include messaging applications, such as e-mail; information services like news, calendar and address book, movie listings, directories and games and entertainment; and e-commerce functions like travel, banking and stock trading.
Local network operators then can make these services available to their customers, and at the same time add their own local content and e-commerce capabilities.
Version 2.0, expected by the end of the year, will add unified messaging; remote handset synchronization with desktop applications; global positioning system location technology, higher bandwidth, instant messaging and voice access.
Additional e-commerce service could include e-customer care, a Wireless Application Protocol-based lottery, MP3 music downloads and an e-wallet function, allowing customers to use their wireless device as an electronic payment system.
While designed mostly for mobile use, the services can be accessed from fixed-line providers as well, the company said, allowing users to configure their menus from the desktop, as well as synchronize information between the desktop and mobile device.
The company said it expects average revenue per unit will increase 25 percent by March 31, 2004, as a result of the services the portal will provide.
To create the system, Vodafone AirTouch made several, nonexclusive strategic partnerships with various computer, Internet and wireless industry firms.
IBM Corp. will design, build and manage the portal, which includes a hardware and service delivery platform from Sun Microsystems Inc., content and commerce services from Infospace.com, financial services from Charles Schwab and travel services from Travelocity.com/Sabre. Supported devices include handheld computers from Palm Computing Inc. and phones from L.M. Ericsson and Nokia Corp., which also will provide support for other key systems on the platform, the company said.
Nokia and Vodafone AirTouch signed a letter of intent to co-develop devices and systems for wireless Internet services, supporting both Wireless Application Protocol and General Packet Radio Service technologies.
Psion plc signed a strategic agreement with the company as well, for mobile Internet personal information management solutions and synchronization abilities. Vodafone AirTouch said it will name other partnerships for additional portal services in the next few months.
The announcement primarily focused on Vodafone AirTouch’s general vision of the portal, but offered few specifics. Analysts said this is because the various partnerships were made rather hastily in order to make an announcement before the Feb. 7 closing date for Vodafone AirTouch’s $138 billion hostile takeover bid presented to Mannesmann shareholders. The Nokia and Psion partnerships, for instance, were announced separately from the others because they were not completed in time for the initial announcement.
“By accepting Vodafone AirTouch’s offer, Mannesmann shareholders will have the opportunity to participate in the explosive growth opportunities of mobile data and the Internet,” the company said.
“We are opening a new chapter in the development of the Internet, and invite Mannesmann shareholders to join us in adding a fourth `W’ to the World Wide Web. From now on, it will be the World Wide Wireless Web,” said Chris Gent, Vodafone AirTouch chief executive officer.
Mannesmann management largely dismissed the announcement.
“Vodafone continues to demonstrate a lack of commitment to and understanding of the enormous potential of wireline and wirefree integration,” read a company release. “Vodafone’s proposition is built only on what Vodafone can offer-a mobile package-rather than what the customer wants-seamless personalized communications solutions.”
“Vodafone’s presentation underlines the deficiency of its strategy, particularly in the areas of control and integration,” said Klaus Esser, Mannesmann’s chairman. “Even more importantly, (the) new Vodafone projections of increased revenue per user serve to confirm the insufficient value of a hostile offer that fails to compensate shareholders for Mannesmann’s superior Internet, data and tele-commerce future.”
Mannesmann further claimed that everything the Vodafone AirTouch portal plan proposes to provide in July presently is available from Mannesmann.
“The reality is that there is nothing that Vodafone will offer in six months that Mannesmann will not already have offered,” the company said.
On Friday, Mannesmann posted its defense strategy for the hostile bid, emphasizing its Internet holdings. Mannesmann management said it felt current Mannesmann shares were worth $359.3 a share, well above the $273.75 per share Vodafone AirTouch is offering.
As a way of realizing this value, Mannesmann said it is exploring an initial public offering of its Internet business.
Analysts noted with interest the lack of Microsoft Corp.’s involvement in the Vodafone AirTouch announcement. Although Vodafone AirTouch said it has not chosen an operating system for the portal yet, IBM recently stated it plans to incorporate Windows competitor Linux as the keystone of its hardware strategy.
