Techies love an acronym and three letters that are causing
considerable excitement in the telecoms and internet industries are WAP
- Wireless Application Protocol - technology that brings the internet to
your mobile phone.
To date, most of us have thought about internet access in terms of PCs,
or possibly interactive TV but with WAP, miniaturised mobile internet
sites can be accessed from mobile phones and this is where the industry
expects internet access will really take off.
With the explosive growth of mobile phone ownership - more than 40% of
the UK population now owns a mobile phone - the link between two of
today’s hottest technologies is expected to create a potent
It has certainly sent equipment manufacturers, mobile phone networks and
e-commerce operators racing to launch WAP phones and services. And there
will be no turning back.
In only a couple of years, new telecoms networks that support high-speed
mobile internet access will be in place and internet-enabled phones are
expected to be the norm. By 2004, Forrester Research predicts that
one-third of Europeans will regularly access the internet via their
However, this is virgin territory and a lot about the mobile internet
market remains unclear. As the mobile phone operators, internet content
providers and e-commerce operations all jostle for position many
questions remain as to just what the technology will or won’t offer,
from both the marketer’s and the consumer’s point of view.
There are some obvious and immediate problems. One is that WAP may not
deliver in the way that some hope. Unrealistic expectations may have
been created for the technology in its current form.
There was a delay in the first phones reaching the market because the
incorporation of the miniaturised internet browser proved to be more
difficult than was envisaged, says Simon Buckingham, founder of the
Mobile Lifestreams consultancy.
WAP is still evolving and Buckingham for one thinks that it has hit the
market too early.
’The customer hasn’t been given any consideration. What (the current
version of WAP does is quite limited and rudimentary - you can’t push
information to customers at the moment, the onus is on the user to find
information,’ claims Buckingham.
’It would have been good if we’d held off for a year and launched it
with the GPRS network,’ he says. GPRS network (see glossary box) is seen
as one of the most important factors for WAP as it will allow high-speed
mobile internet access.
With a range of content providers investing in WAP services, the
mismatch between expectations and possibilities could be damaging, says
’The expectations have been set so high. I’m worried that we will damage
ourselves by hype.’
Nevertheless, few doubt that in the longer term, mobile internet will
take off. ’I think WAP will be a big success. In the next few months, we
will see handset availability and mobile portals launched,’ says
Despite the teething problems, many companies clearly believe that they
cannot afford to stand back. A recent study by Forrester Research found
that 90% of European e-commerce operators surveyed expected to launch
mobile internet sites and nearly 50% of them expected their sites to be
live by the middle of 2000.
These companies believe that mobile internet services add value and that
in the multi-channel future, their customers will automatically expect
the services .
However, Falk Muller-Veerse, European research manager at Durlacher, the
internet investment group, forecasts that it is e-mail that will be the
initial killer application for mobile internet services, paving the way
for instant messaging and mobile commerce.
There are limitations with the mobile interface which will probably
discourage users from undertaking complex internet operations from their
phones - but mobiles may be ideal for certain other forms of
Users carry their mobile phones with them, so they are ideal for
time-sensitive information, such as news alerts, share price
information, sporting results and travel and weather updates. People
could use their mobile phone during a night out to book film or concert
While PCs and televisions are often shared, mobile phones are invariably
used by one individual owner - so the phone is ideal for targeted
Also, positioning systems can be used to deliver location-dependent
services - a sale alert can be sent to an individual’s mobile phone as
they stroll along the high street.
Travel operators, news providers and banks have made early commitments
to mobile commerce - although advertisers, auction sites and online CD
retailers are also set to offer services.
Airlines have been among the first movers - internet-enabled phones
could give customers access to journey information and check-in
Finnair launched SMS- based services in spring 1999 and moved to WAP in
autumn 1999. Swissair and Lufthansa also offer WAP services.
More recently, in December, the BBC announced an agreement with Vodafone
Airtouch to develop mobile news services for WAP and UMTS. The WAP
service is expected to go live in the next few months.
’The partnership with Vodafone is important because it’s the largest
operator,’ says a BBC spokesman. However, the partnership is not
exclusive and other agreements will be announced through the year.
’It (the mobile platform) enables customers to get news anywhere and any
time,’ adds the spokesman. For news providers this is important - in
recent years they have had to seek out new ways of reaching their
NatWest and the Woolwich are among the financial services groups
developing mobile internet services. The Woolwich is working with Nokia,
while NatWest has linked up with Orange and plans to run a WAP trial in
spring 2000 with a view to launching the service later in the year.
’We’re looking to have a similar level of functionality as on our web
site. There will be added features - for example, text messaging to
alert you if your account drops below a certain level,’ says
spokesperson for NatWest.
Boxman, the internet CD retailer, has a WAP service up and running in
Sweden and plans to roll out local versions across Europe, starting with
the UK in early February.
Christopher Codrington, vice-president of commercial partnerships at
Boxman, observes that: ’There’s no map to this - it’s like the internet
four years ago.’ However, he believes that impulse behaviour will be
important - people might hear a track on the radio and decide to buy it
from their mobile phone straightaway.
Durlacher predicts that by 2003, advertising will be the leading mobile
commerce application. Sponsorship and branding of the mobile interface -
rather than the banner ads that dominate internet advertising - will be
important components of mobile advertising. Additionally, marketers will
be able to take advantage of customisation and personalisation to
develop more targeted mobile one-to-one marketing.
So who are going to be the key players in the new mobile commerce
The mobile phone networks are in a powerful position - they have a
subscriber base, a billing relationship with their customers and access
to information about their subscribers.
As with the PC-based internet, portal strategies will be important and
most mobile networks are building mobile portals and linking with
content providers and e-commerce operators to offer mobile services.
’They have to become serious portal players,’ observes
Mobile phone operators are also likely to move into m-commerce directly
- Mannesmann is expected to offer banking services within 12 months, for
Durlacher also forecasts that the mobile phones will be used widely as
electronic wallets for mobile e-commerce activities.
The other issue for debate is how open the new mobile services will
Forrester Research predicts that a number of operators will try to lock
in subscribers by launching ’closed’ services that block subscriber
access to the wider mobile internet.
However, in the long term, services will open up. Content providers will
not want to be tied to one network and it may be that new intermediaries
called mobile internet providers (MIPs) - probably backed by existing
ISPs and portals - will become key players and help open up the
Subscribers to MIPs will be able to dial into a public WAP gateway with
access to any mobile internet site. Forrester expects market pressures
to have forced mobile operators to provide open access to all users by
But one barrier to the take-up of mobile internet services in the
short-term is likely to be cost. Currently, the cost of mobile internet
use tends to be high because the bearers that support mobile internet
access are slow and users are charged by call duration.
However, the cost should come down as the faster GPRS is introduced and
new payment models are devised. GPRS is an ’always-on’ system, so users
are likely to be charged according to the volume of data transmitted
rather than a time-related charge. Alternatively, charging might depend
on the services used.
Pre-pay WAP phone packages - due out in the second half of the year -
are expected to trigger growth and the mainstream adoption of WAP.
The handsets will probably cost between pounds 120 and pounds 130. In
reality they cost a lot more, but as with all mobile phones the cost to
the consumer is subsidised by the network. Handset prices are likely to
come down as the phones move into mass production and lower-end models
However, the mobile internet revolution will keep on rolling and will
not be limited to mobile phones. Within a few years, we are likely to
see the distinctions between mobile phones and consumer electronics
products become blurred - there may be devices that are both phone and
MP3 player, or phone and games console.
’You’ll see different devices for different people with different uses,’
says Muller-Veerse. ’It’s a major change for the telecoms world and the
consumer electronics world - only a few (companies) have expertise in
Wireless Application Protocol (WAP)
The standard for connecting wireless devices such as phones to the
Short Message Service (SMS)
Allows text messages of up to 160 characters to be sent to and from
Global System for Mobile Communications (GSM)
The prevailing mobile standard in Europe and most of Asia Pacific.
General Packet Radio Service (GPRS)
Standard within GSM that will allow instant, high-speed internet access
from mobile devices. European mobile phone networks will begin to
introduce GPRS in the second half of 2000.
Universal Mobile Telecommunications System/Third Generation
High-capacity, third generation network that will support mobile video
as well as audio, graphics and text. The first UMTS licence has been
awarded in Finland and the rest of Europe will start to award licences
HOW THE LEADING PLAYERS ARE LINING UP FOR WAP
The Nokia 7110 is the first WAP phone to be available in the UK -
although there are still precious few units in the shops. Nokia says
that it started to distribute the handsets in September 1999 and they
should now be widely available. Ericsson is already selling a
WAP-enabled PDA (personal digital assistant), the MC218, and is to
launch two WAP phones in the first half of this year - the R320 and the
higher-end R380. Motorola’s WAP phone, the Timeport P7389, will be
launched this month and is expected to cost about pounds 120, depending
on the network.
Orange launched a WAP service in November 1999, based on the Nokia 7110
- the Orange 7110e, which costs pounds 129.99. Orange’s WAP services
include news from ITN, sports news from PA and Sporting Life, traffic
information, listings, business directories and information about travel
offers from Lastminute.com. Orange is also developing online banking
services with NatWest. While Orange’s service is currently closed -
users cannot access other mobile internet services - the company says it
will move to open access shortly. Access was free until the end of
January - but now charging will be on a per minute basis until new
pricing structures are introduced.
Vodafone is launching its mobile internet services in July. Vodafone has
linked up with Sun Microsystems, IBM and Infospace.com on the technology
side, while Travelocity.com and the internet stock broker, Charles
Schwab, are to provide content. In September 1999, Vodafone launched
Vodafone Interactive - an SMS-based service that allows customers to use
text messaging and e-mail and to receive news alerts.
One 2 One plans to sell branded WAP phones from March this year - the
handsets are expected to be the Nokia 7110, Motorola Timeport and
Ericsson R320. The initial WAP services are likely to be e-mail, games
and customer services so that users can check bills online. One 2 One is
trialling news, sport, weather and travel services. The target market
will be 16- to 35-year-old early adopters. Initially, pricing will be
per minute. Later in the year, One 2 One will launch pre-pay WAP
BTCellnet unveiled its mobile internet services at the end of January.
Subscribers will be able to access tailored internet content from
providers including Lastminute.com, the BBC, Guardian Unlimited, Excite
and European Investor.com, as well as the content and services already
available through Genie Internet, which has 500,000 subscribers. The BT
Cellnet internet phone is a branded version of the Nokia 7110, priced at
pounds 129.99. Calls will be charged at 5p per minute.
Virgin launched its mobile phones in November last year. It is plannning
to introduce web browsing to its phones using its own version of WAP. It
will be written onto the Virgin Mobile SIM card rather than into
specific handsets. The company says its Advanced Wireless Technology
platform will allow customers to browse internet sites without the need
of a special WAP phone.
- More than 117 million people in the EU own mobile phones and many are
already using mobile data services - two billion SMS text messages are
being sent in Europe each month.
By the end of 2000
- 7.1 million Europeans will buy internet-enabled mobile phones and 6.1
million of them will visit at least one mobile internet site a
- 10%-15% of all mobile phones sold this year will be ’media-phones’ (ie
internet-enabled phones) and more media-phones will be sold this year
- 40 million Europeans will have internet-enabled phones.
2002 and beyond
- 14% of Europeans will be regular users of mobile internet services and
this figure will rise to 20% by 2003.
- By 2003 more than 200 million mobile phone subscribers - more than 85%
of mobile phone users - in Europe will have WAP phones.
- By 2004 more than 219 million people will own internet-enabled mobile
phones and more than 131 million - one-third of all Europeans - will
regularly use their mobile phones to access the internet.
- From 2003, no major manufacturer will produce a mobile phone that does
not have an internet browser.
Countries taking up WAP
- Mobile internet services are likely to be most important in those
countries that already have a high penetration of mobile phone ownership
and SMS use.
- Finland has more mobile phone users than fixed phone subscribers.
- Mobile internet services will accelerate internet penetration in
countries such as Spain, Italy and Greece that have otherwise lagged in
- The European mobile commerce market - which was worth 32m euros
(pounds 194m) in 1998 - will be worth 23.6bn euros (pounds 14.25bn) by
- Italy will be the biggest single m-commerce market, worth 4.8bn
euros,(pounds 2.9bn) followed by Germany ( 4.1bn euros, pounds 2.47bn)
and the UK (3.4bn euros (pounds 2.05bn).
- By 2003, the main application for mobile internet access will be
advertising, which will account for 23% of the mobile commerce market.
Financial services will account for 21% and personalised shopping
services for 15%.
Sources: Forrester Research, Nokia and Durlacher.