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Mobility, Re-Shaping the World of Search
Mobility, Re-Shaping the World of Search
Changes in Search see Growing Number of Investments Towards
Mobile Applications
By Ann-Marie Fleming, www.InternetSearchEngineStocks.com
November 2005
The mobile arena is heating up as a variety of traditional
Internet search firms have turned their attention to mobile
search applications. As this movement picks up from companies
such as Google, Yahoo! and Microsoft, questions still surround
feasible revenue models to take advantage of the growing number
of mobile users, through innovative search services.
As Robert Enderle, President and Principal Analyst of the
Enderle Group explains, "The overall goals of companies in this
space differ. Microsoft is primarily a platform company, Yahoo
is more of a portal pure-play, and Google, at least for now, is
a search pure play. All three companies have search and have
major efforts with regard to search, but Google is the only one
that only does search at this particular point. However they are
expanding to capture a wider array of activity so that you are
constantly connecting through them in one way, shape or form to
the vendors that they support."
Google, in identifying the mobile arena as a high priority, has
launched a variety of mobile initiatives and are currently
involved in several beta projects. Deep Nishar, Director of
Product Management describes Google's mobile involvement, "A
year ago we launched Google SMS Search in the U.S. and the UK
which allows users to send in queries using SMS and giving
responses back on topics such as weather, movies, directions,
stock quotes and other generalized queries. We recently launched
the Google Local for mobile application, a downloadable Java
application that works on more than 100 phones and is currently
available on Cingular and Sprint. The mobile version has the
same searches as Google Local on the web, but given that it is
an application it provides additional interactivity and features
for a more seamless experience."
Microsoft's MSN Search was released in beta this summer for MSN
Mobile customers in the U.S. This service allows consumers to
benefit from local search, instant answers and other MSN Search
capabilities now available via mobile devices, providing them
with easy access to precise answers from any location. According
to a MSN Spokesperson, "MSN is investing to deliver rich
communication experiences for consumers, ultimately bringing our
consumers closer to the people and information that matter most
- anytime, anywhere."
There are key differences between the ways that companies
provide search services on the Internet versus a mobile device.
While handsets have come a long way in their level of
sophistication the fact remains that screens are small, users
are on-the-go and information must be direct. As Jay Smith,
Associate Professor, Kagoshima University Inamori Academy of
Management & Technology in Japan explains, "The cell phone
presents its own challenges due to space constraints. Wading
through pages of search results is really not a good option and
much of the web, particularly outside Japan, consists of pages
that aren't really set up for mobile viewing. That's why
services that actually answer questions or provide a
service/solution are fundamentally more useful."
Companies such as AskMeNow, a mobile search provider that gives
users the ability to ask virtually any question found on the
Internet and receive a direct and relevant answer rather than
links in return, are focused on the concept of simplicity. Based
on the realization that users of handheld devices are more
likely drawn to applications that suit the mobile platform in
terms of simplicity, suitability and efficiency, the Company
believes their direct answer approach appeals to the needs of
the mobile user. AskMeNow's CEO, Darryl Cohen explains, "The
Internet in its current form is not easy to navigate through on
the average phone, therefore the format needs to be adapted for
ease of use and access to relevant information. Our application
is built around the need for simplicity so that users can get
direct answers to their questions. We have created an interface
that is incredibly user friendly and together with our back end,
allows for the input of questions through either natural voice
or free form text."
Answers.com, an answer based search engine that aggregates over
100 different reference sources in order to present answers to
users' queries as an alternative to link responses, has extended
its web service to the mobile platform with 'Mobile Answers'.
"We look at the mobile version of Answers as an extension of our
strategy to the handheld market where people need quick access
to a lot of information on a topic whether they are visiting a
place or trying to find the answer to a question they are
discussing over a meal or a business meeting. With Mobile
Answers, we are giving quick access to the comprehensive
information we provide on over 1 million topics," describes Jeff
Cutler, Chief Revenue Officer. Answers Corporation is utilizing
their mobile extension to deliver on their mission of providing
comprehensive information anytime, on any device and to extend
their branding. "It is our hope that people who use Mobile
Answers will be that much more inclined to use Answers online,"
explains Cutler.
Google is also focused on the mobile behavior as a model to
shape their services by. "We continue to focus on the best
possible user experience in the mobile arena. In the last 12
months we have launched a great deal of products focused on
easing the customer's interactions with the mobile device. The
goal is to make sure that users get content that is relevant as
well as formatted for their devices. We do things such as taking
sidebar links and putting them appropriately on the face so they
do not take up the first ten screens," describes Nishar.
As companies operating in the mobile space begin to explore the
possibilities for growth, diversification and differentiation,
traditional search firms have yet to fully exploit the potential
of this new avenue. However, recent moves by firms such as
Google reveal exploration of a variety of opportunities.
According to Enderle, "For the most part companies such as
Google, Yahoo and Microsoft are not looking at the mobile
platform as something unique,
Didn't Find What You Were Looking For?
Try a Specialized Search HERE
but more as an adjunct to
something that you would typically be doing at your desk. This
is not atypical of a new class of device or a new service
because people tend to do what they know, taking a little while
to realize that differences can lead to new avenues and
opportunities as they begin to explore the edges of the
technology to find that niche that specifically leverages the
mobile aspects of the product."
Debate continues as to the most effective means for generating
revenue from services such as mobile search as existing formats
built upon Internet services may not necessarily prove effective
on the mobile platform. "There needs to be an effective business
model in place to accelerate the adoption of mobile search,"
states Cutler. AskMeNow, while offering a free version of its
search service, is also pursuing a per-use revenue model through
the Company's AskMeAnything service targeted towards users
(small fee of .49¢ per question) who prefer to ask questions not
available under their standard formatted questions. "We have an
interesting revenue model that will create ongoing transactional
revenue for the carriers to share in through our AskMeAnything
feature, which based on beta testing is a fee-per-use service
that consumers are interested in using," describes Cohen.
Mobile Advertising:
For companies such as Yahoo and Google with a significant focus
on revenue from advertisements retrieved via web searches in the
traditional sense, mobile advertising presents significant
challenges to this business model. With limited screen size, and
thousands of advertisers, a shift in how ads are integrated and
targeted is inevitable in order to take advantage of this arena.
Companies that are developing the business model around the
mobile arena are seeing value in alternative options for
advertisers to solicit customers through search results. "We are
building a database of customers that have toll-free or call
through capability provided through our search results and
accessed with a simple click on your device. We have created a
mechanism that will allow local advertisers to advertise with us
very economically and be able to share all of their pertinent
information with our end-users without our end-users having to
access or search for them on the Internet. We use the Internet
as a mechanism for bringing you the information, but we don't
make users go onto the Internet to obtain their answers. We give
you an answer that we do not want you to go hunting for; instead
the answer will open up right in front of you on your screen,"
explains Cohen
As industry players focus in on mobile advertising that is
relevant and suitable to wireless users, Cohen explains that
there is considerable opportunity in local search utilizing the
sense of urgency that is more prevalent in mobile device usage
versus traditional Internet use. "It is not about finding the
location of a business that you already know; it's about taking
advantage of an offering from that business when you are
interested. For example if you need a prescription filled, you
are leaving your office and want to order ahead to your pharmacy
to be able to pick it up on the way home. First you will want to
know the pharmacy in your area that has the cheapest price, then
you can choose which pharmacy to order your prescription from,
all made possible from your handheld device. This will be part
of our application in the near future," describes Cohen.
Market Drivers:
As the technology for mobile handsets continues to evolve and
the comfort level of mobile users strengthens, growth in this
market will continue. "What broadband has done for the Internet
and advertising, broadband to the handset has the potential to
be the driving force behind the growth of this arena," describes
Bruce Smith, VP, Investor Relations and Strategic Development
for Answers Corporation.
Examples of technology driving the market and the revenue
potential of mobile services can be seen in Japan, a nation with
89 million cellphone subscribers (75% of population over 15
years of age) out of which 77 million have data service
accounts. "There clearly is a market available for advertisers
as well as user services. Cell phones have become a complete
consumer electronic entertainment device serving as a PDA,
messaging center, entertainment device, and phone. The cellphone
is the one continuous connection. KDDI Corporation (#2 provider
after NTT) has been a driver in pushing 3G (nearly all phones)
and now 3.5G fast speed services. All of which allow for more
types of services, faster downloads so you aren't waiting for
advertising. They have also driven data service, photo exchange
usage forward with flat rate plans versus previously expensive
packet charges by NTT Docomo, "discussed Professor Smith.
With multiple players focusing their efforts on the potential of
mobile search and mobile advertising, within a market that
Juniper Research forecasts as reaching 2.7 billion worldwide
subscribers by 2010, the opportunities to service this growing
population appear lucrative. As described by Juniper Research,
"Increased sales of handsets and higher Average Revenue per User
from data services will come primarily from the ability to
provide easy-to-use and intuitive/dynamic services that
customers can both understand and manage, or, better still, that
manage themselves contextually."
Ann-Marie Fleming Ann-Marie Fleming completed her MBA in the
United States, where she attended Webster University. She also
holds an Honors B.A from the University of Toronto. She has over
fifteen years of experience within the financial industry to
include retail banking and brokerage, investment banking, and
mortgage brokerage within the United States and Canada, with a
firm background in corporate research.
Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp,
©Copyright InvestorIdeas 2005
About the author:
Ann-Marie Fleming completed her MBA in the United States, where
she attended Webster University. She also holds an Honors B.A
from the University of Toronto. She has over fifteen years of
experience within the financial industry to include retail
banking and brokerage, investment banking, and mortgage
brokerage within the United States and Canada, with a firm
background in corporate research.
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