Wireless is getting Googled. And, well, Yahoo’d.
The Internet giants have made numerous headlines in recent weeks as they rush to become the premier destination on the wireless Web. And they’re doing it in very different ways.
Google Inc. fired the year’s opening salvo earlier this month at the Consumer Electronics Show in Las Vegas, announcing a deal to place a Google-branded button on handsets from Motorola Inc. for one-touch access to the mobile Internet. Motorola declined to say which phones would sport the key, but said the first handsets under the agreement are expected to ship this quarter.
The development is seen as a major win for Google and is expected to increase usage of the wireless Web, which thus far has failed to live up to expectations. Not only does the button deliver users to Google’s site with a single click, it allows the Internet giant to present its brand and services directly to users.
“To get that kind of hardware button (on a phone) is a big deal,” said Mark Donovan, vice president of products and senior analyst at M:Metrics. “To date, the only people who have been able to get a hardware button (on a phone) are the carriers.”
Google upped the ante a few days later, launching a mobile version of its personalized home page. Registered members with XHTML-capable browsers can customize and access Google’s mobile site with Gmail account information, news, weather, stock quotes and RSS feeds.
The Mountain View, Calif.-based company made several other announcements, disclosing the acquisition of Reqwireless Inc., a Canadian developer specializing in wireless Web browser and e-mail software, and notching a deal with Research In Motion Ltd. to bring its instant messaging, mapping and search services to BlackBerry devices.
Yahoo Inc., on the other hand, is working to build on its success in fostering virtual communities by expanding its services from the desktop to the mobile phone. The company also used CES to roll out a new line of offerings including Go Mobile, which delivers e-mail and instant messaging as well as allowing members to upload photos from a camera phone to Yahoo’s online photo service.
The offering is part a broader Yahoo Go platform that aims to integrate mobile phones, computers and digital home entertainment equipment. Yahoo also announced its own deal with Motorola to include Yahoo applications on handsets, allowing users to access them without having to drill through carrier decks or direct their mobile browser to Yahoo’s site, which can be even more cumbersome.
Analysts say both Google and Yahoo are rushing to provide mobile services that carriers and handset makers have failed to capitalize on. And the companies may be forcing carriers one step closer to being just a dumb pipe for data services.
“These developments are forcing business-model changes for carriers, whose key strength remains their control over access networks,” Merrill Lynch analyst Glen Campbell wrote in a research note. “As their control over applications and content loosens, they are more likely to focus on doing what they do best-and how to monetize it.”
Other notable Internet companies, including America Online Inc. and MSN, have largely remained quiet during the last few months while Google and Yahoo scurry to deploy wireless offerings. But AOL is sure to increase its presence on the playing field-witness last year’s acquisition of mobile technology company Wildseed Inc.-and MSN parent Microsoft Corp. continues to try to extend its presence from PCs to mobile phones.
But while the Internet big boys are spending vast sums to gain a foothold in mobile, they have yet to install their biggest revenue generator: advertising. One key, especially for Google, is sure to be the mobile-search space.
Google has filed an application to patent a wireless marketing method that would allow users to dial an advertiser’s phone number with a single click.
“The present invention concerns adapting an online ad environment to make ads more useful for devices with call functionality, and/or a limited ability to render Web pages in a manner more satisfying to a user … such as mobile phones for example,” according to the document. “When such an ad is selected (e.g., via a button click), instead of loading a document (e.g., Web page) for rendering, a telephone number associated with the ad by an advertiser is automatically dialed.”
Google declined to discuss details of the application, saying, “We file applications on a variety of ideas that our employees may come up with. Some of those ideas later mature into real products or services, some don’t.”
How Google’s proposed marketing method is worthy of a patent is unclear, however. Many text-message search services for local information already include links to phone numbers that users can dial with a single click.
While many search-and-marketing services are similar, several players are heading in different directions to establish a business model. InfoSpace Inc., which provides a platform for Cingular Wireless L.L.C. users, hopes to generate revenues from every call a consumer makes using its offering, while JumpTap Inc. is looking to partner with carriers to replicate established Internet-search models similar to Google’s AdWords.
Other players include Ask Jeeves Inc., 4INFO, Gree411.com and Interchange Corp. But Google and Yahoo have set their sights higher in an effort to become the consumer’s gateway to the wireless Web. Whether either company-or any of the smaller competitors-can cash in on mobile remains to be seen, though.
“The race has just begun, but we’re clearly seeing the validation of mobile as part of a continuum of connectivity,” said M:Metrics’ Donovan. “And the monetization of the mobile piece on its own is something that hasn’t been figured out quite yet, but I suspect it will come.”
