Unwired Ideas

If you have a cell phone, look at it closely. Examine its tiny screen, tinker with its rubber keypads. Do you feel anything strange? Can you sense any possibility of making money, tons of money?

If you don’t, chances are you are not an entrepreneur. And you’d never be interested in developing money-making or so-called "killer" applications for this gadget most Filipinos are now crazy about.

Arcy Canumay, interim president of PhilWAPP, a group of wireless application developers, said the number of people wanting to make money from computers and cell phones is growing.

"Filipinos wanting to develop contents and applications for mobiles like cell phones are increasing," he said. "You can just see it here. Everyone seems to be interested in how to seize this opportunity."

The "here" Canumay was referring to was the Beyond WAPPcceleration symposium held last Tuesday at the Makati Shangri-La Hotel. The event attracted hundreds of people, mostly techies eager to find out how other countries like Japan had made it big in developing cell phone applications. And it highlighted the "opportunities" that abound in the Philippines with its millions of cell phone users.

Among those who attended the symposium were Hubert Ang and Dax Dacumos, two of the four pillars of a young company called Fluxion which Canumay is helping to take off. The two young men, along with husband-and-wife Rolen and Susie Facundo, developed "Storit" which now allows cell phone users to have a virtual storage space for their text messages, ringtones, logos and other files.

"We’ve been using cell phones for years and we always have problems with low storage capacity," said Ang. "So we came up with Storit which is a virtual digital warehouse."

Fluxion is now making money through the 40-percent share it gets from Globe Telecom, which launched the Storit service three weeks ago. Its earnings are increasing as two new subscribers use the service every five minutes.

"It really serves a need," said Canumay in describing the Storit idea. "And we need more of these."

I-mode’s eye-opener

The symposium’s highlight was the presentation of Dr. Takeshi Natsuno, one of the four people who developed "i-mode," a mobile Internet service now being used by 26.2 million people in Japan, with two million more reportedly being added every month.

A no-nonsense guy, Natsuno painted i-mode in the most basic terms, avoiding jargon that makes technology talk sounds alien.

"Focus on content," he stressed. "You don’t need any more technology. It is already there."

Natsuno said the Philippine market is very much like Japan’s, which also started off with text messaging or SMS before i-mode’s introduction on Feb. 22 1999. He said Japanese cell phone users also sent heavy text messages, and i-mode allowed them to do more so they gradually shifted to the service until SMS was completely phased out. (Filipino cell phone users send more than 50 million messages a day.)

I-mode’s phenomenal success in so short a period has made it one of the cell phone world’s wonders. Many countries, particularly in Europe, where cell phone use is more prevalent, are now studying its business model for possible replication.

What these countries couldn’t believe up to now, though, is how i-mode became such a big hit with just a handful of technology firepower. Its transmission rate is actually a measly 9.6 kbps, far more sluggish than most modems used in PCs. And the programming language used by the tens of thousands of official and non-official content partners is compact HTML, a slightly modified version of the Internet standard HTML and not even the much-hyped Wireless Application Protocol or WAP.

I-mode was first launched in Tokyo and Osaka, two of the most densely populated areas of Japan, which, just like Metro Manila, suffer from high cost of wired Internet access.

Its main creator, Mari Matsunaga, is not even a techie (she studied French literature in college). And Natsuno, too, had far less concern for technology than for developing something that would be patronized by even the most techno-dummy of cell phone users.

"We set up the i-mode on an Internet business model rather than a wireless Internet model," he said. "We never looked for wireless specialist content providers. And we stuck with the same phones that users are more familiar with rather than go for ones that look more like PDAs (personal digital assistants or palmtops)."

Secret of success

Natsuno said no one ever predicted that i-mode would turn into what it is today. The company which developed it – DoCoMo – was in fact just a spin-off of telecoms giant NTT. Most of its staffers were first reluctant to leave the main company for what was, in 1992, considered as the dull, barely digital backwater of cellular services.

DoCoMo’s first president Kouji Ohboshi broke with tradition by recruiting staff from outside the company. Matsunaga and Natsuno were two of them, and they started up with the business model that they believed would make good use of the existing technology. And they focused on content using the following criteria:

• It should be fresh (once a day is too slow);

• It should be deep (it should be more than a simple text message and it should require some drilling down to other levels);

• It should encourage repeat visits (thus, games became a huge hit); and

• The user should be able to see the benefit.

Natsuno did a demo of the i-mode’s service at the Beyond WAPPcceleration event. Without uttering a word, he managed to drive home a message to those present that i-mode is not just useful, but more importantly, fun to use.

"Cool phone!" was what many of the attendees uttered after seeing the colorful handset Natsuno used and hearing its "stereo" sound. "And it seems it’s very easy to use," they added.

Natsuno said that contrary to the belief of many, majority of i-mode’s subscribers are those in the 29 to 44 age bracket, and most of them are male. And these are the people who download Hello Kitty logos by the millions.

Natsuno recalled that when i-mode was starting, he signed up 67 application providers for a variety of content. "Good content attracts users, which, in turn, attracts more content," he said. Now, i-mode has thousands of such application and content providers who receive 91 percent of its earnings. "We only get nine percent of the income," he said.

Another foreign expert who shared the Beyond WAPPcceleration limelight with Natsuno was Peter Cohan, author of such best-selling books like e-Stocks, e-Profit and The Technology Leaders. He agreed completely with Natsuno, saying that at the end of the day, those that offer the "right service" and not so much the most advanced technology, would survive.

"It’s more of the service that goes with the technology. Some businesses spend too much money on technology that quickly falls apart," he said.

Cohan noted that technology has become a huge enterprise that so-called innovations can easily be hyped and labeled "the next big thing," with corporations rushing head over heels to reap profits from the new craze.

He may have hit the nail on the head. At present, the whole world is rushing to copy i-mode’s model. Local telecoms giants Globe Telecom and Smart Communications are no exceptions. Canumay, who works for IdeaFarm, which the Ayalas (owner of Globe) put up, said it is not true that Smart enjoys an advantage when it comes to replicating i-mode’s services.

"NTT may be an investor of PLDT (which controls Smart). But NTT DoCoMo is a completely separate entity. Natsuno himself confirmed it so I can say that nobody enjoys any advantage as far as providing i-mode-like services here," he said with a sheepish grin.

Will i-mode be a hit in this country? Canumay just shrugged his shoulders. "Nobody can say for sure," he said as he picked up his beeping phone to read a text message.