Google, Yahoo seed a promising market with 'mobile desktop' plans and mapping app
The battle for the hearts and eyes of handheld users notched up a level last week, with Google Inc. unveiling a free application that lets people get directions, maps, and satellite imagery on their cell phones. Meanwhile, Yahoo Inc. is moving forward with plans to create a "mobile desktop" of its services via a partnership with carrier SBC Communications Inc. But before the two companies can carve up the wireless Internet market, they need to convince the average user that all these tools are easy and useful enough to be worth the effort.
The global market for location-based services is expected to surpass $8.5 billion by 2010.
Photo by Sacha Lecca
Google and Yahoo are working on it. Google devotees can search the Web using a browser on their cell phones, or they can send queries by Short Message Service, such as asking for a local weather forecast. Yahoo's mobile portal supports E-mail, text messaging, games, and Web searches, but it takes a lot of user setup. That's why Yahoo is working to extend its co-branded SBC Yahoo Internet service to cell phones and PDAs. As early as next year, it plans to offer a Nokia cell phone using SBC's Cingular network that comes loaded with a Yahoo portal, with access to Yahoo E-mail and instant messaging, plus video-on-demand, Internet radio, and even remote access for programming digital video recorders.
The market for location-based services on cell phones, including mapping, is $1 billion today, but globally it's expected to pass $8.5 billion by the end of 2010, Juniper Research predicts. The mobile version of Google's Local mapping service will include the same features available from the desktop version, including driving directions and local business listings, plus features such as click-to-call. "Users can find a restaurant when driving through a new neighborhood, hit the click-to-call button to make a reservation, and view directions," says Gummi Hafsteinsson, a product manager at Google's Local for Mobile group. Google isn't serving up ads with its mobile services yet, though Hafsteinsson says it's possible.
Yahoo's partnership with SBC may give it an edge over Google in attracting customers to its mobile services, says Enda Flynn, a consultant at BusinessEdge Solutions and former executive director of the SBC-Yahoo alliance. "Yahoo is getting revenue from SBC customers who sign up for the SBC Yahoo service, and the same thing will happen when the service goes mobile," he says.
How much of an edge the SBC partnership offers remains to be seen. In general Internet searches, Google has about 38% of the market and Yahoo 30%, comScore Networks' September research finds. What might be most important in mobile Internet is helping customers break down today's barriers, such as high network-usage charges, slow data speeds, and incompatibility with some mobile devices. Google Local for Mobile, for instance, works with most
Java-enabled mobile phones but doesn't support Verizon or Nextel networks, or BlackBerry and Palm devices. Dialing 411 is easier today than trying to query a search engine for a number. "Consumers aren't able to equate value to the service," says Forrester Research analyst Charles Golvin. Data services will account for just over 20% of $698 billion in operator-service revenue worldwide, the Yankee Group forecasts.
Third-party developers are trying to make those killer apps, especially for businesses. Logistics and real-estate companies use maps on cell phones and PDAs, often with software from developers who've used APIs to mobilize Google, Microsoft, or Yahoo maps. Could Google's new products scare off such developers? Cristian Streng, developer of Mobile GMaps, a free app for noncommercial use that displays Google, Yahoo, and MSN Virtual Earth maps on mobile phones and PDAs, says Google's lack of support for some mobile devices, services, and other mapping apps means that's not going to happen anytime soon.
The Business of Going DigitalDigital business isn't about changing code; it's about changing what legacy sales, distribution, customer service, and product groups do in the new digital age. It's about bringing big data analytics, mobile, social, marketing automation, cloud computing, and the app economy together to launch new products and services. We're seeing new titles in this digital revolution, new responsibilities, new business models, and major shifts in technology spending.