Planet of the Apps (Part II)

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High Stakes

The question of user behavior as a guide for wireless product development has thus been far from academic: Last year, four European telcos spent a combined total of $126 billion on 3G licenses, while their share prices fell. "For first- and second-generation phones, the market was so strong, and voice was so effective as an application, there was less of a need to think about the question of user behavior," says Vodafone’s Gosset. "But with 3G we’re really trying to understand the market."

To achieve that, Vodafone (along with fellow U.K. network operators Orange and BT Celnet) launched a sociological research project in 1998 to study teenage cell phone and SMS usage. The study, conducted by the University of Surrey, interviewed 150 teenagers and 40 parents in shopping malls, airports and train stations. Surrey sociologist Dr. Nicola Green then began a series of workshops with Gosset, leader of "future studies" at Vodafone. The company has also funded a permanent sociology chair at Surrey (Spanish academic Dr. Amparo Lasen begins her post as the Vodafone Surrey Scholar in September).

"The study’s been very useful, because there are a lot of things that tend to be taken for granted from an engineering perspective, but which turn out to be false," says Gosset. "It’s led us to look at R&D in a different way, based on what users actually do with current devices, rather than just what’s technically feasible. The technology allows us to do so much now that it’s not really a limiting factor."

Vodafone will not disclose details of its future 3G services, but Gossett says the Surrey research has led senior management to consider a less "top-down" approach to application development. In April, Vodafone launched Vivazzi Find & Seek, a location-based information service for WAP-enabled cell phone users in England, Scotland and Wales.

Open Development

One radical version of a less "top-down" approach is to decentralize development through open source technologies and third-party developers. Some companies believe that open platforms will be a more effective way of meeting localized market needs than trying to second-guess varying cultural climates and controlling all application development. "I was going to say that perhaps wireless video messaging might take off better in Southern Europe — Italy, for example, because the Italians are so demonstrative," says PacketVideo’s Tercek. "But then you start falling into national stereotypes, which is ridiculous. It’s much more complex than that."

To tackle that complexity, in July, PacketVideo launched a worldwide program for third-party application developers. The program gives tools for wireless developers to create custom APIs and SDKs for the company’s MPEG–4-based platform. Twenty companies have joined the program so far, from the United States, Europe, Japan and Asia, to develop information, entertainment and communication applications according to regional market needs. Tercek says that the PV Platform offers a universal infrastructure with a variety of locally customizable options, essentially tailoring a global franchise according to local flavors. McDonalds’ strategy of shunning beef in favor of lamb for burgers in its India locations (to respect Hindu custom) is a "perfect metaphor" for PacketVideo’s global plans, Tercek says.

Emblaze Systems, a competitor to PacketVideo, is also releasing its APIs to third-party application developers. And for similar reasons of flexibility, the company is building on MPEG-4. "Open source and open architecture are the key strategy for real growth," says Dror Ginsberg, chief technical officer at Emblaze, which launched a system for MPEG-4 wireless streaming video in June. Five European cellular operators have agreed to test the system over GPRS (general packet radio service) networks over the next year.

Nokia also supports open standards, via the Symbian OS. "You can’t dictate what kind of content people want," says Isosomppi. In July, Red Hat and British software company 3G Lab announced their plan to develop a "Linux for the wireless world," allowing manufacturers to create applications with their own look, feel and branding. Gosset speculates that if Java-enabled phones become widely available, open source developers could create a huge increase in finely personalized applications.