T he market for mobile technology is booming, fueled by the introduction of easier-to-use cell phones and flat-rate calling plans that encourage the use of phones and personal data assistants for Internet applications.
Riding the surge are D.C.-area firms with expertise in supporting mobile networks and making on-the-move Web browsing more phone-friendly. Local firms are also well-entrenched in the emerging mobile advertising sector — an industry whose revenues will reach $1.3 billion this year and are expected to top $7.6 billion by 2013, according to Juniper Research.
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With the introduction of the BlackBerry Pearl earlier this year and the iPhone 3G arriving in July, smart phones are now reaching a wider audience.
The devices are easier to use and work more seamlessly with popular applications such as iTunes. The trend is expected to accelerate when Google, known for its user-friendly Web site, releases its Android open mobile platform at the end of this year. A host of new applications is expected to follow from a variety of sources.
To tap the growing market of mobile Web users, cellular networks began offering flat-rate plans for voice and data services this year. Most of the major carriers, including AT&T and Verizon, shifted to a $99.99-per-month-model, while Virgin Mobile is charging $79.99.
“That is a pretty significant trend,” said Pragnesh Shah, chief executive officer of Reston-based Mobilians International. “What it does from an industry standpoint is draw even more of a focus on networks differentiating themselves through data services; that will increasingly be the base of competition.”
Among local companies hoping to capitalize on the rush to mobile browsing is D.C.’s DotMobi, which sells domains specifically geared toward Web sites appearing on cellular phones. Sites that end in the .mobi extension are compatible on cell phones’ smaller screens and unique interfaces, unlike many Internet sites whose search functions do not work or graphics cannot be displayed.
MPortal of McLean and NetBiscuits of Reston have the perhaps less glamorous but essential job of building the technology backbone that allows for mobile interfaces and applications. NetBiscuits, for example, wrote software that powers the mobile sites of eBay and Yahoo.
Mobile advertising is the area in which the most D.C. groups have found significant roles, with such companies as Acuity Mobile, Millennial Media, Proteus and Mobile Discovery all holding a stake in the industry segment.
David Miller from Mobile Discovery is banking that consumers will take to a technology that produces bar codes on print ads, which people canscan with their phones to receive incentives such as coupons.
“For print companies struggling to compete with the Internet, this is like a lifeline,” Miller said in an interview; his firm has partnered with such firms as Gannett in recent initiatives.
Miller is also encouraged by the fact that companies are beginning to dedicate a line in their ad budget to mobile.
“This is the first year this is really happening,” Miller said.
Eric Eller, senior vice president for Baltimore’s Millennial Media, warns that advertisers must learn to gear their ads specifically to a mobile users, who tend to be more rushed than desk-based Internet users.
“You don’t sit down on your BlackBerry to do product research for two hours,” Eller said.
Some D.C. firms have also found a role producing both functional and entertainment-related applications for cell phones. Mobilians is working in the area of mobile payments, a rather undeveloped segment in the U.S. compared with countries such as Japan and Korea. Kajeet of Bethesda produces mobile content specifically targeted to a teen and tween audience, such as Nickelodeon games, and Square Loop works in the area of emergency alerts via text.
Emerging now are mobile applications for social networking, video and navigation, according to analysts. This month, social networking mobile startup Jaxtr raised $10 million in venture capital. What companies are calling location-based services are also beginning to take off — this includes using GPS to automatically gear items such as sports scores to a local audience.
“This is hitting its stride this year, big-time,” said Derek Kerton of The Kerton Group.
