E-mail Already Popular, But Multimedia's Day Is Coming

SMS monthly usage levels of 30 billion worldwide appear to leave little room for other forms of wireless messaging. But access to e-mail also is taking up wireless users' time, and is regularly identified by industry analysts as the most popular mobile telecom application.

And despite its popularity, SMS is destined to become a fond memory for most wireless users. Multimedia messaging services (MMS) will become key revenue drivers for wireless carriers after they roll out infrastructure that supports the service.

In the wireless e-mail arena, Seattle-based ViAir uses a different approach from most other vendors by targeting the consumer market first rather than the enterprise space. ViAir's network-based application, WirelessInbox, is providing e-mail access for subscribers on networks operated by six carriers.

The latest innovation by wireless e-mail platform vendors targeting the enterprise market comes in the form of marketing agreements with providers of mobile computing devices. The more mobile devices their platforms work with, the better the odds are that businesses will choose their technology to wirelessly extend applications. And the closer their relationships are with device vendors, the closer they can be to increasing their market share.

But in the battle for SMS market share, SMS technology players will face bigger and more threatening competition for providing carriers with MMS. While SMS is largely limited to exchanging text messages, MMS represents a more lucrative offering for carriers by enabling users to compose, send and receive messages using pictures, audio and video clips as well as text.

But while SMS and enhanced- messaging service (EMS) work with 2G digital networks, MMS requires at least 2.5G data rates.

The world's largest wireless company, Vodafone [VOD], already signed Ericsson [ERICY] to a global contract for MMS software.

"Logica, even though they were massively ahead in SMS, failed to gain first-mover edge in MMS," said Dion Price, senior industry analyst for Mobile Streams. "Ericsson is fantastically ahead in MMS." Plus, Ericsson can offer MMS technology with infrastructure deployments. "They are ideally suited for MMS and I think they will lead the market," Price said.

Although offering EMS most likely would boost subscribers' interest in messaging, wireless carriers aren't making much of a play for the capability. They're looking ahead to MMS without stopping at EMS.

"It is like a quantum leap forward, but MMS is going to be late," Price said. One problem is the scarcity so far of 2.5G networks and MSS-capable phones, and another is producing technology that translates MMS material for devices capable of only SMS.

November 18, 2004