Opening opportunity Featured

9:36am EDT July 22, 2002

Wireless portals may be the new technology in town, but it won't take long for people to notice.

Wireless portals, those that enable mobile device users to access the Internet, are predicted by the Strategis Group to have 300,000 users by the end of the year. This figure skyrockets to 5.7 million in 2002 and 25 million in 2006.

So what is a wireless portal? The limitations of mobile devices, whether it be a PDA such as a Palm VII or a phone, keep them from accessing the Internet through traditional portals such as Yahoo!. Wireless portals are a one-stop shopping point for getting information. They are made completely of text menus, because graphics appear crude on the little screens and take up too much bandwidth.

Sites that can be accessed by mobile devices have to be written in Wireless Application Protocol rather than the traditional HTML.

For consumers to access information, these portals charge a monthly fee, in addition to airtime charges, though this hasn't deterred a phenomenal growth rate.

"Sprint has been out there since about December of 1999, but they already have close to 500,000 subscribers," says Cynthia Hswe, senior analyst for the Strategis Group.

The other two big players are Palm VII and OmniSky, but Verizon, Nextel and other PCS providers are racing to catch up.

"Once there are more competitors, some may start offering the service for free," says Hswe. "You might have to see a series of ads before launching."

Wired portals are also entering into the fray.

"What they are trying to do is establish a wireless extension of their portal," says Hswe. "They are partnering with the carriers, because the carriers have a stranglehold on the pipe. They can't achieve open browsing just yet, so they are at the mercy of the carriers. They are planning for the day when you can type in the URL for the portal and be able to access it without going through the carrier's portal."

In the wired Internet world, we use portals like Yahoo! to simplify the experience, but it isn't necessary. In the wireless world, a portal is a necessity. There is no time to browse and you can't type in any URL. You have to use a portal to gain access to information.

"A portal actually makes more sense in the phone than wired," says Hswe. "If a provider partners with a content provider like Yahoo! or Amazon, there will either be a menu item listed for them, or have something like, 'Sports brought to you by ...'"

The big future for the mobile devices may lie in e-commerce, even if that ability has yet to be developed.

"You can't do anything with them now other than make a stock trade or buy airline tickets," says Hswe. "The providers are talking about transforming how we view the handsets. They want us to see it not just as a communications tool, but as a payment tool as well."

Some ideas being discussed have the device storing personal and financial information and taking the place of an ATM or credit card. But unlike the wired Internet, which is largely free and resistant to fees, the wireless services will probably expect you to pay.

The Strategis Group study shows that:

  • Unlike the conventional, fixed Internet, mobile Internet subscribers will most likely be willing to pay for certain types of content because such content in a mobile setting greatly enhances utility.

  • Executive interviews revealed two distinct views on wireless portal revenue. Of the carriers interviewed, 80 percent believed that wireless Internet services will remain a subscription-based service, while 64 percent of the portal and content integration companies surveyed believed that promotion and transaction revenue would drive their businesses.
How to reach: www.strategisgroup.com

Todd Shryock (tshryock@sbnnet.com) is SBN's special reports editor.