ME.COM OFFENSIVE: As a harbinger of the age of connectivity, the WAP phone was disappointing. But the communications industry insists that the internet's future is mobile and to prove it is turning e-commerce into me-commerce - personalised data and servi

ME.COM OFFENSIVE: As a harbinger of the age of connectivity, the WAP phone was disappointing. But the communications industry insists that the internet's future is mobile and to prove it is turning e-commerce into me-commerce - personalised data and servi

Last Updated: 31 Aug 2010

Imagine the scene. You're in a strange town a few years hence, on your way to meet a client for the first time. Leaving the hotel, you confidently head off in the right direction, although you've never been there before and haven't asked the way. How come you're so sure you know where you're going? Because your glasses are wirelessly connected via Bluetooth to a net-enabled smart phone in your pocket, and they are projecting downloaded instructions directly on to your field of vision - like a fighter pilot's head-up display. If that's not enough to keep you on the straight and narrow, the phone also tracks your exact location and movements (by means of its built-in Global Positioning System chip) and flashes up corrections if you still manage to take a wrong turning.

OK, so a taxi or a decent map could achieve the same result, but this technology has other uses. On the flight over, you had a virtual meeting with the MD (prospects for business in the new United Republic of Korea) and visited ToysRStillUs to buy a birthday present for your four-year-old. Then the interactive city guide function found a restaurant with an interesting menu near your hotel and booked you a table as a post-meeting treat. And yes, the glasses also correct the short-sightedness you developed from peering too hard at your monitor back in the days when you still had a desk and the PC was king.

It may sound like something out of The Matrix, but this is me-commerce - e-commerce on the go, personalised to your exact location and requirements.

And we will be able to do it a lot sooner than you might think. Even the kind of gadgetry described above is as much science fact as science fiction. Bluetooth (a so-called 'personal area network' that allows devices within 10 metres of each other to communicate without cables) has already found a market in hands-free telephone headsets, with more applications to come.

First-generation smart phones (the much-discussed WAP mobiles) have been around for a year or more, and even early versions of the high-tech specs can be bought more or less off the shelf. But at about pounds 4,500 for something that makes you look like an extra from Star Trek - The Next Generation, you are unlikely to spot many pairs on the high street yet.

'Mobile commerce really is about to take off,' says Rama Aysola, founder of me-commerce software specialist AirFlash, which is working with the Orange network to provide 'location-dependant services' such as directions and hotel information on its forthcoming mobile internet portal.

It is already possible for some users (customers of Richard Branson's Virgin Mobile service, for example) to buy CDs, wine and even TV sets via their phones, and Aysola predicts that these simple financial transactions will become more common as other operators follow suit. 'You'll be able to book things like cinema tickets using a WAP phone, and the cost will simply be added to your bill,' he says.

Of course, if you don't want to wait that long, you could just call the box office on your old-world mobile, but those who would dismiss me-commerce as just another techno-turkey should take note: the communications industry expects a mobile future and is prepared to invest heavily in making it happen. It is predicted that by 2005 there will be half a billion devices (ranging from smart mobile phones to internet-enabled electronic organisers) capable of conducting me-commerce, and that the revenues generated this way will top dollars 200 billion worldwide - growth that makes the take-up of the PC-based internet to date look pedestrian.

'Mobile will be the biggest market ever, no question of that,' says Larry Sellin, director of mobile e-services at Hewlett-Packard, a company that is best known for thing-making and is already energetically positioning itself as a provider of me-commerce infrastructure.

But all that cash isn't going to be made simply by selling CDs and cinema tickets. Just as in the world of the fixed internet, business-to-business will be a big earner. The benefits of a salesperson being able to access and manage a web-based diary and customer database through a personal organiser are obvious - no more clashing appointments, and instant customer expertise even if they've never met the client. And that's just for starters. How about customers and suppliers being able to check their order status, process a new order and even authorise payments on the spot, wherever they are?

'There is real demand for these kinds of mobile services in business,' says Paul Turton, associate director at consultants CSC. 'E-commerce on the fixed internet has paved the way and companies are already budgeting for them.'

Unsurprisingly, some of the keenest proponents of me-commerce are the mobile network operators themselves. Web portals for mobile users, such as BT Cellnet's Genie Internet and Vodafone Airtouch's Vizzavi, which offer enhanced functions to existing users as well as access to some of the internet for WAP customers, have been launching every few weeks this year. And the pounds 22 billion shelled out back in the spring on licences to run third-generation (3G) networks after 2002 was spent in the belief that the superior me-commerce capability of 3G will fuel an explosion in demand.

The technology may be cutting-edge, but the commercial logic behind the investment of these telephone-number sums is simple. Earnings derived from voice calls made over mobile networks are falling, so the likes of Orange, Vodafone Airtouch and BT Cellnet are casting about for new sources of revenue, based on supplying data and services to users on the fly.

'We are bullish about the future of mobile commerce,' says Stuart Newstead, manager of wireless communications at BT Cellnet. 'We need to get that money back from somewhere.'

The networks want to sell pick-axes to goldminers, but there are good reasons for optimism among those further down the mobile food chain, too.

Says Panu Mustonen, chief executive of Helsinki-based mobile gaming outfit SpringToys (which creates online games for all types of mobile phones and organisers): 'The fixed internet sucks in comparison to mobile - so much of it is free. People expect to pay for services on their mobile phones.'

But they also have high expectations, so services have to be tailored to the medium - instantly engaging and quick to use. 'Warmed-over web pages won't do,' says Mustonen. 'You have to make your offering work in five-minute bites.'

Finland was the birthplace of affordable mobile phones 10 years ago and is at the forefront of me-commerce today. For example, customers of that country's Leonia Bank can now pay gas and electricity bills via their mobile phones.

A couple of years after the first simple me-commerce applications appear, user 'pull' will be replaced by service 'push', says AirFlash's Aysola.

In other words, instead of having to spend time looking for what you want, what you want will find you. 'When you pass the dry cleaners, you'll get a message on your phone reminding you to collect,' he says. Or your local pizza place will offer you a special deal at lunchtime.

But direct-to-phone promotions could easily become the electronic equivalent of junk mail. Just because it's lunchtime doesn't mean you are hungry, and what if you don't fancy a pizza? That perfect promotion suddenly looks a lot less impressive. 'If I get 10 messages a day offering me things I don't want, this isn't going to work,' says CSC's Turton.

In theory, that won't happen because promotions will be based on permission, meaning that you have to opt in and you will get only what you request; if you ask for food-related offers, you shouldn't get a promotion from a CD retailer. 'The last thing that anyone in this business will want is for you to hit the off button,' says Newstead at BT Cellnet. That may be true, but the amount of junk e-mail already in circulation on the fixed internet doesn't bode well.

So your mobile will know where you are (it is already possible to locate the signal from a mobile phone to within a few hundred square metres in a city centre) and it will know what you like to do, based on your previous choices and usage patterns. 'The technology will make choices based on your habits and preferences,' says Aysola.

'Your lifestyle will talk to you.'

The prospect of that surreal dialogue is the most controversial aspect of me-commerce. On the one hand it promises the holy grail of direct marketing - access to individuals as and when they make buying decisions that could be worth a fortune. But how much control over their lives will people give to a presumptuous electronic box of tricks? 'People quickly get pissed off if they feel that the technology is running them,' says Mustonen at SpringToys.

That's all in the future. What of the mobile internet today? WAP (the Wireless Application Protocol that allows mobile phones to connect to the net) was supposed to herald a new age of mobile connectivity, but has met only a lukewarm response from consumers more interested in what they can do with their expensive new toys now than what they might be able to do next year.

'WAP is like the fixed internet of four or five years ago. It's been overhyped and consumers are wary,' says Mike Wood, business development director at Psion. Hardly surprising when it is billed as 'the internet on your mobile phone'. Compared to the full-on multimedia experience that is the worldwide web on a PC, users are bound to regard the lack of graphics and the titchy monochrome screen as a let-down. It is also limited to compatible web sites - most existing sites need to be translated from the internet's standard language HTML (Hypertext Mark-up Language) into the WAP language, WML (Wireless Mark-up Language).

But the biggest problem for most users is that WAP is too slow, although access speed will improve as better network technology rolls out across Europe over the next couple of years. 'WAP disappoints because of the lack of a proper network to support it. That will change,' says Miko Salinnen, director of technology at Finnish network operator Radiolinja, which fathered the first mobile revolution in 1991.

Once those faster networks are in place, other hurdles will have to be cleared - the small matter of security, for example, and the question of how billing will be handled. 'There is currently no structure for secure payment over mobile networks,' says Andrew Tolputt, mobile specialist at the Phillips Research Group.

And there is no consensus as to what that structure should be. Will it be based on the credit card, like e-commerce, or will some form of electronic cash predominate? Will people be happy simply to add the cost of all purchases onto their phone bills?

'Mobile commerce calls for relationships between service and content suppliers, networks, and billing providers that just don't exist at the moment,' comments Tolputt.

A mobile device that carries so much personal information also poses questions of civil liberties. 'If the phone network knows where you are and what you like to do, who else does and what can they do with that knowledge?' asks CSC's Turton. 'The end user has to be put in control of their data.'

So despite the optimism and jockeying for position that characterises the mobile marketplace, the story so far is one of potential yet to be fulfilled - there is a long way to go before the more spectacular visions of me-commerce are realised. But the business case is compelling, and even sceptical commentators accept that it's on the way. 'It's a few years off at least, but it will happen,' says Tolputt. 'The networks need to generate more revenue and this is how they will do it.' Better start saving for a pair of those specs.

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