Mobile Web Is a ‘Bust,’ But Starting to Open Up

Internet leaders who gathered in London Thursday to applaud the launch of a flat-rate mobile data plan from 3 Group were quick to criticize the progress of the wireless Internet so far, an indication of the difficulties they’ve experienced entering the mobile market.

“To date, the mobile Web has been a bust,” said Joe Costello, Orb Networks’ cofounder and chairman. Orb allows remote access to content stored on a PC.

Skype Chief Executive Officer (CEO) Niklas Zennstrom was a bit kinder: “Many of you, as I, have been disappointed with mobile offerings from the 3G [third-generation] operators,” he said.

Operators have typically restricted what mobile users could access online, often by allowing access only to Internet services within their own portals. While some operators have begun to open up in that regard, few in Europe have moved to unlimited data plans. That means customers are often reluctant to use Internet-based applications because they’re unsure about how much it might cost them.

The Internet companies, including Yahoo, Google and eBay, whose leaders spoke Thursday are all offering services to subscribers of a new offering from 3 that delivers unlimited mobile data access for a flat monthly fee. 3 didn’t reveal pricing, but did say that a fair-use limit would apply and that some services, like video, would come with higher fees.

With the launch of X-Series, 3 plans to try to follow a new principle: “What is free to use on the Net ought in principle to be free when you use it on the mobile Net,” said Frank Sixt, group finance director for Hutchison Whampoa, 3 Group’s owner.

That strategy marks a sea change. “Mobile operators in Western Europe have mostly been trying to avoid having their data business follow the Internet business model,” John Delaney, a principal analyst with Ovum, wrote in a research note.

T-Mobile International AG & Co. in Europe offers a service called Web n Walk, enabling mobile Internet access for a flat fee. But 3 goes an extra step by selling phones with software applications such as Skype and MSN Messenger included. “By limiting everything to the browser, T-Mobile avoids having people using the worrying services like Skype and MSN Messenger,” Delaney said. Operators have typically been resistant to such services because they compete with their voice and text-messaging offerings.

The Internet companies are eager for operators like 3 to open up because they’re becoming increasingly interested in extending their services to mobile users as a way to continue to drive growth.

Connecting Yahoo’s 500 million PC-based users with the 3 billion mobile phone users in the world “is a huge opportunity for our company,” said Terry Semel, CEO of Yahoo.

EBay, which has offered some mobile users the ability to buy and sell and check the progress of auctions from their phones, also said that 3’s service is a step toward enabling the mobile Web.

“This is the moment when consumers are given the right tools to experience the Net away from their desktops,” Meg Whitman, president and CEO of eBay, said in a video played during 3’s announcement.

-Nancy Gohring, IDG News Service (Dublin Bureau)

Related Links:

• Web Leaders: Mobile is Tough Nut to Crack

• Experts: Don’t Copy Web 2.0 Directly to Phones

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