WAP gets wired by Swiss firm

Insiders say sales of the phones, which come in a corded and cordless variety, are promising. Swissvoice

A Swiss company has found a way to deliver Internet information to fixed line telephones using a protocol developed for the wireless world.

This content was published on March 13, 2002

Making Internet services available through mobile phones is a big idea that is currently being realized across Europe. The "mobile Internet" is seen as a way for mobile network operator license holders to tap into the current mania for messaging and multimedia via the wired network.

Now operators who have fixed network licenses, in addition to mobile licenses, want to make the Internet available to subscribers who don't have a PC - a market that includes every single incumbent telecommunications operator in Europe.

Rather than use so-called screenphones equipped with HTML browsers, subscriber can use a simple terminal running WAP browsers. The full colour, screenphones are expensive and slow, say the WAP terminal vendors, whereas the WAP terminals are faster and cheaper.

Swisscom began to sell the terminals enabling fixed network access to SMS and WAP in January. Deutsche Telekom launched its wired WAP and SMS service in February.

Both operators told Swiss Venture Update that it is too soon to estimate the success of the wired WAP and SMS services. "But it is clearly an important differentiator," says Telekom's spokesperson in Bonn. "We are a full service provider and this is one way we develop that concept."

Anecdotal evidence suggests that wired WAP may be more successful than wireless WAP, at least in the first phase.

It is a Swiss company that came up with the idea of installing a WAP terminal in an ISDN phone.

Sales of the phones, which come in a corded and cordless variety, are promising say insiders. "Using ISDN to access WAP content is faster. One ISDN channel delivers WAP 6.5 times faster than the mobile network. Emails can be retrieved with the touch of a button," says Ingo Schmucki, Product Manager, Swissvoice.

Swissvoice is not the only firm trying to wire WAP. Amstrad, the UK PC maker-turned-consumer electronics firm, has been selling such terminals with a focus on offering email access to non-PC users.

Swissvoice is a privately owned company. It was cleaved out of Ascom, the largest telecommunications equipment vendor in Switzerland. The terminals business was sold to turnaround specialists Swiss Capital Equity Holding AG late last year and is now called Swissvoice.

Selling becomes a political matter

Solothurn-based Swissvoice has been selling ISDN phones equipped with a WAP browser and email program since last autumn, selling directly to network operators. That strategy fits with the company's roots. Its traditional market when it was Ascom was supplying all terminal equipment to Swisscom during the monopoly times.

It is a smart tactic to target the incumbents. It promises high volume business, relying as it does on selling to Europe's largest service providers, many of whom still have a monopolistic hold on their home markets.

Despite the many years of liberalization and privatisation efforts on the part of the telecommunications industry and European Commission in Brussels, the last mile has been a market notoriously difficult to break into for alternative telecommunications operators.

Other Swiss telecommunication equipment manufacturers, terminal vendors in particular, have struggled to reach volume sales because their products were targeted at the alternative telecommunications service provider, many of whom are barely managing to compete.

Schmid Telecom, for example, has unwittingly become an advocate of breaking up the "last mile" monopoly because its newest products require competition in that segment. It is a similar story with the Ascom Powerline Communications, a maker of terminals enabling data services over the electrical or power networks.

Both businesses while enjoying steady growth today would have achieved higher growth rates if liberalization had been carried out more thoroughly in Europe and abroad.

Money and sex to drive growth

Insiders suggest that WAP on the fixed line is an interim technology. Interim timeframes in the telecommunications industry are not the same as interim in the computing sector. An interim can be a lifetime in some cases.

Witness the timeframe for "first generation Internet access" - the copper wire telephone network. Most consumers and home office users are still accessing the Web via a network that is almost 100 years old.

This reporter expects that the wired WAP terminals will be around for a while, especially if the vendors figure out how to install digital signatures in the phones. The digital signatures are required for financial applications, such as home banking.

Mobile banking and home banking are still not the big killer applications they were expected to be, primarily because of difficulties with the terminals. Only PC users with high end Internet connections can comfortably access Internet banks. Home banking using the mobile phone has not been accepted because of the apparent lack of security and the poor response time using WAP or SMS based application.

Operators see subscribers using the telephone book and directory services and accessing information on the WAP terminal while chatting on the phone.

It is likely that subscribers will figure out other things to do with the phones. When SMS was launched it was envisioned by the operators as a technical and business oriented service. It has in reality been adopted widely as a consumer or leisure application.

And don't forget sex. WAP has become the red light district of the mobile network. Practically every mobile portal in Europe has an "erotic" channel. The content ranges from naughty to nasty.

The bottom line is that "adult" content offers content providers and network operator a steady stream of revenues and so it is likely that wired WAP services will also benefit from catering in one way or another to basic human instincts.

by Valerie Thompson

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