Wireless will revolutionize U.S. markets at warp speed

Excitement about wireless is exploding in the United States as the merger and alliance binge among telecommunications operators continues. But, according to Dial M for Mobile, a new study by Roland Berger Strategy Consultants in cooperation with the New York New Media Association (NYNMA), this is only the tip of the iceberg.

"Over the coming months, wireless applications will turn all U.S. industries and business processes upside down, from wireless entertainment to improved supply chain management," said Eric Kintz, associate partner at Roland Berger and a co-author of the study.

Katherine Pendill, the study's other co-author, stresses that wireless is more than just hype. "It's really the new 'big thing.' It offers a key opportunity for every company in every sector—not just for telecommunications outfits such as Ericsson, but for companies like Microsoft, MasterCard, Citibank and UPS. For the first time, the technology is not coming from the United States and spreading to Europe and Asia—it's everywhere at once. It's the first truly global phenomenon."

Designed as a roadmap to help guide companies through the maze of wireless technology, the study was conducted by Roland Berger consultants in the United States, Europe, and Asia, working closely with wireless leaders such as 2Roam, Compaq, MasterCard, Siegelgale, Sonera Zed, Unplugged Games, Vindigo and Vizzavi. NYNMA has been Roland Berger's partner in this research, providing insightful views on the critical issues facing players in the wireless arena.

"It is no surprise that wireless technology is garnering so much attention, as the demand from New York's on-the-move culture for wireless applications and services will only increase," said Alice O'Rourke, executive director of the New York New Media Association. "This technology will be at the center of Silicon Alley's growth in the coming year."

Among the key issues is speed to market. "With the current shattering of the wireless Internet value chain, all players—wireless operators, software providers, portals, handset manufacturers—are moving quickly to secure a dominant position. First-movers will have a critical advantage by getting the best partners," Kintz said.

The study identifies four main trends in the nascent wireless space:

• The bandwidth game: "In gaming, we are moving into a wireless broadband environment," Pendill says. "Wireless gaming will go through an evolution similar to the one the fixed Internet did over the last few years. What we'll see will be like a progressive shift from wireless Atari to a wireless Play Station."

• Think outside of the box: The standard cell phone will sprout a variety of new functions, either bundled together into one box (as practiced by handset manufacturers such as Nokia) or available as add-ons (the Compaq approach). But that's just the beginning, as wireless devices migrate out of the box and into our clothes, cars, and appliances. "There will be new devices we haven't even thought of," Pendill said, "such as Sensatex's 'smart shirt' that can transmit wirelessly vital diagnostic information such as a patient's heart rate."

• Anywhere, any time: The ability to pinpoint a person's geographic position through their mobile device opens the door to a wealth of new services. Among the up-and-coming applications: traffic and navigation systems, B2B tracking and store location monitors. There will even be dating services that can beep you if a compatible suitor comes within 300 yards.

• From Geek to Chic: The consumer orientation of the wireless revolution means that to succeed, the geeky must be repositioned as cool. In Japan, DoCoMo's I-mode platform has been so successful—17 million customers expected by year end—due to the fact that they have focused on entertainment by partnering with companies like Disney and Bandai. "As a result, teens are rapidly becoming the key target market," Kintz added.

The Roland Berger report concludes with a discussion of the six "key success factors" that every company will have to implement if it hopes to win in the wireless world. Among the most significant are:

• Content: Keep it simple and customized. A simple migration of fixed Internet to a wireless interface won't work. Users have to be sensitive to the device limitations, such as screen size and bandwidth and at the same time leverage its core assets: close link to the customer, time- and location-specific interaction, etc.
  
• Connectivity: Become device agnostic: In a market exploding with devices, consumers are going to demand applications that are seamlessly integrated—from laptop computer to PDA to mobile phone and back again.

Edited by Ellen Jensen
Managing Editor, Wireless Networks Online