CMGI in the PALM of Your Hand
By Justamom
When my children were infants I used to gaze at them asleep in their cribs and wonder what they would be like as they grew up. Would they play baseball or play in the band? Will they be good in school; will they have lots friends? Will they be happy and healthy? Now my children are teenagers, emerging young adults, and I realize every day these questions are being answered before my very eyes. So it was with the first article on the history of @Ventures. Over a very short, 3 year period, we have seen the birth, maturation, IPO, sale or both of the first companies to emerge from the CMGI incubator.
Now we are going back to the nursery. This article will focus on several of CMGI's most recent deals and investments in the very new frontier known as wireless communication. And many thanks to DW who outlined much of this in the June 13 conference call. He saved me hours of work.
CMGI's Wireless Web
There is so much activity in this area of wireless communication, networking and "w-commerce" that I was struggling to find a metaphor, so we would have a "picture" to look at rather than just words. I thought first of an octopus, with each tentacle representing one of CMGI's deals. But guess what, eight is not enough. In fact, CMGI has "more legs" in this sector than a Victoria's Secret Fashion Show! So sit back, hold on tight to your binoculars, and get ready for the hottest CMGI "babes" to come strutting down the runway!!
As DW explained in the conference call, 97% of the world is not yet on the Internet. Future net access will not be from PC’s, but from smaller, cheaper and more efficient wireless handheld devices. This is itself is a form of disruptive technology and innovation. Cell phones are now offered free with the subscription plan. Palms, beepers and pagers are increasingly becoming web enabled at very low monthly costs. The Palm and cell phone are soon to be integrated into one handheld appliance. Even Gameboys will be configured for the Internet. And new devices have not even been invented yet.
IDC estimates that by 2003, there will be 88 million wireless net appliances up from current levels of 42.5 million; a conservative doubling. Mobile commerce is projected to grow at about the same rate, from $61 billion currently to over $100 billion in the same time period. Amazon.com was the first "e-tailer" to sell us books on the Internet. So our first "model" is the business to consumer (B2C) model, where Amazon will want us to buy books from our beeper. They will even sell us the beeper. CMGI has two entrants in this category, Alta Vista and MyWay.com.
1. AltaVista
AltaVista Shopping.com unveiled AltaVista Shopping Everywhere, a new wireless and handheld computing resource on the Web. The new site features wireless applications that allow users of Web-enabled phones, Palm and Pocket PC handheld devices to access AltaVista Shopping.com's leading objective comparison shopping guide for Web-wide shopping across the Internet or at local retail outlets. The channel also features an extensive collection of content, software, hardware and accessories for handheld and wireless devices from Handango, the world's leading Internet marketplace for handheld computing solutions. AltaVista Shopping Everywhere is a one-stop resource for users to unlock the power of the Internet with the latest wireless devices and productivity-improving applications. AltaVista Shopping Everywhere highlights include:
· Applications to enable Web-wide objective research and comparison shopping for users of Web-phones, Palm and Pocket PC handheld devices
· A library of more than 8,500 downloadable wireless and PDA applications
· Dedicated information resources for Palm, Windows-powered and Symbian device users
· Informative lists of top software downloads and new product add-ons
· New Users Forum with tips for first time buyers, a glossary of common wireless terminology and links to discussion groups on the latest wireless devices.
"By placing AltaVista Shopping.com's objective, Web-wide shopping service in the hands of mobile users, AltaVista Shopping Everywhere may create the most knowledgeable consumers ever," said Michael Rubin, executive vice president of marketing and e-commerce, AltaVista Company. "This is the beginning of a new age for retail shoppers." Users of AltaVista's Shopping Everywhere applications will have access to AltaVista Shopping.com's objective information resources including merchant ratings, consumer reviews and product comparisons.
2. MyWay
MyWay.com continuedsto establish itself as a leading provider of both wired and wireless portal solutions. MyWay announced the completion of the Bell South roll-out, adding more than 700,000 Bell South subscribers to the MyWay network. According to the conference call, MyWay has a total of 3 million users. It has experienced a 300% increase in its userbase since October 1999.
MyWay.com, a leading developer and distributor of wired and wireless portal solutions and a majority-owned operating company of CMGI, Inc. (Nasdaq: CMGI), and Phone.com, Inc. (Nasdaq: PHCM), a leading provider of mobile Internet software and services, announced a strategic alliance to provide wireless network operators with a customized portal service offering. This alliance marks the integration of MyWay.com's broad suite of personalized Internet content with the Phone.com™ MyPhone™ portal framework and suite of communication services, which is expected to provide wireless network operators extensive cross-service integration and personalization, ensuring easy-to-use wireless access.
Phone.com's MyPhone provides wireless-ready communications applications, tools and interfaces that make a comprehensive wireless service consistent and easy to use. MyWay.com provides a highly personalized web portal with a wide variety of Internet content that is accessible from multiple devices. As part of the non-exclusive agreement, the MyWay.com offering will be integrated with MyPhone-allowing wireless network operators to rapidly come to market with a comprehensive high quality wireless portal offering.
"The ability to personalize the Internet experience is essential for wireless users who expect convenient and fast access to relevant information and services," said Mark Cullinane, Vice President of Global Internet Partnerships for MyWay.com. "With MyWay.com and Phone.com's comprehensive and integrated solution, we can now offer customers a more complete and compelling personalized user experience."
"As a principal supplier of wireless services for network operators, Phone.com is pleased to offer the flexibility to integrate the MyPhone suite of communication services with MyWay.com's robust content into a comprehensive wireless offering for subscribers," said Ben Linder, Vice President of Marketing for Phone.com. "This alliance leverages technologies from both companies and enables users to customize the site specifically for wireless access-providing users with the information they want and need."
MyWay.com aggregates content and applications from more than 65 leading information partners including AccuWeather, Reuters, TheStreet.com, and ZDNet, making it one of the most content-rich sites on the Web. The portal also features best-of-breed applications from CMGI operating companies and CMGI @Ventures companies, including AltaVista Search, Engage, Tribal Voice, Vicinity and KOZ.com.
Phone.com services are broadly used throughout the wireless industry-with over 50 wireless network operator customers worldwide and more than 25 handset manufacture licensees, its network infrastructure software allows wireless network operators the ability to offer users access to the Internet using a wide range of mobile devices. The integration of applications on top of the underlying network structure makes Phone.com's offering one of the most complete and integrated mobile service offerings available today.
Our second "model" is in the B2B space. This is almost like the invention of the bikini. It comes in so many shapes, sizes and colors. And there are undoubtedly many more new and exciting opportunities down the road. The fields of advertising, business travel, and property management companies are just the beginning. AdForce, an CMGI operating company affiliated with ENGA is active in the first. While two @Venture companies are at work in the last two sectors mentioned.
3. AdForce
As part of the AdForce EveryWhere program, AdForce announced new strategic relationsips with a number of wireless companies including Nokia, fusionOne, and 2Roam, as well as with interactive television companies ICTV and Set-top.com. Continuing to pioneer the burgeoning wireless advertising initiative, on April 19th AdForce announced the formation of the Wireless Advertising Industry Association(WAIA), the first wireless association of its kind, which merged with the IAB in May to form the Wireless Advertising Association (WAA). The quarter drew to a close with the completion of the merger between AdForce and AdTECH, a longtime AdForce partner and a significant player in the European Internet advertising market. The addition of AdTECH significantly bolsters AdForce's international presence. When you consider that 97% of the world is not yet on the Internet, and when they do access it, it will be through wireless devices, this is a significant alliance.
4. SoftNet Zone
SoftNet Zone (SOFN) is an independent company, but one with many ties to CMGI. It is a provider of high-speed Internet access over cable lines primarily to rural markets. As of 11/99, the Company had approximately 9,140 cable modem customers. SoftNet avoids high infrastructure costs of reaching rural areas by delivering high speed access through satellites. In December, the company received a $129 million investment from Pacific Century Cyberworks (NASDAQ:PCCLF - news) to help replicate the high-speed cable strategy across Asia.
A few weeks later, SoftNet acquired an airport-based Internet access provider, Laptop Link. Soon thereafter, Compaq Computer (NYSE:CPQ - news) and CMGI (NASDAQ:CMGI - news) invested a combined $60 million in a newly-created joint venture with SoftNet to expand Laptop Link's mobile Net access business. SoftNet Zone will operate local area networks and computing business service centers throughout public facilities such as airports, convention centers, and hotels, specifically targeting the business traveler market. Can’t get any more "B2B" than that. Also with the PCCLF tie-in, this could easily become a global venture as well.
5. Corrigo
Corrigo’s initial solutions target the property management industry with maintenance and customer service solutions. With the residential property management rollout underway, Corrigo is quickly moving into further real estate sectors and other maintenance, repair and installation markets. Corrigo continues to actively establish alliances with companies that can enhance its ability to enter new markets quickly and develop complementary solutions for its existing products. Corrigo is transforming the way organizations with mobile workers view service delivery by coordinating the entire process from customer contact through service fulfillment and supplier and vendor management.
"Corrigo was founded in February of last year to apply innovations in wireless technology and the Internet to organizations with large, mobile service and field operations. This includes a wide range of industries from property management maintenance to appliance and capital equipment repair," said Corrigo president Rick Michaux, a former director of marketing at Motorola. "Our Mobile Service Management solutions are designed to enhance customer satisfaction and deliver operating efficiencies to these organizations, which are traditionally labor intensive and paper-based."
"Mobile Service Management is a significant new opportunity. We expect this powerful combination of the Web and the latest in wireless technology to have a dramatic impact on the service delivery process across a number of industries," said Charles Finnie, General Partner with CMGI @Ventures. "We’re excited by the breadth of application potential for this solution and expect Corrigo to be a leader in this emerging market. The company has a strong management team made up of individuals from industry leaders, including Motorola, Panasonic, Andersen Consulting, Datastream Systems and Hewlett-Packard." The CMGI @Ventures$12.5 million investment will be disbursed from it’s $1 billion B2B Fund. Hey maybe they can even get the "cable guy" to show up.
The third model is the B2B&C. Here we have just one entry, Vicinity, which has been a public company since February 2000. Vicinity was one of @Ventures first investments in 1997. The future is now for this company. Through a relationship with Vicinity, AltaVista Shopping.com also provides users with directions to local merchants.
6. Vicinity
Vicinity is the only company that blends brick and mortar with click and order. It turns web traffic into store traffic, by helping people find their way from web sites to real world shops, products and services. It has proprietary data bases and geographically enabled Web search technology that locates geographic points in relation to the business sites of Vicinity clients. It is the true answer to prayer for those retailers who are afraid the web will steal their business. Vicinity has over 300 customers including: FedEx, Ford, GM, Hewlett-Packard, Hilton Hotels Corporation, Marriott, McDonald’s, NEC, Pizza Hut, Starbucks, Starwood Hotels, Taco Bell, Toyota, Levi Strauss & Co. and UPS.
Vicinity also picked up Domino’s and the US Air Force as new clients in the most recent quarter, due to new developments in their technology.
Vicinity’s penetration of the wireless market continued with distribution of its BrandFinder(sm) on numerous wireless platforms through partnerships with OmniSky, AT&T Interactive, and GTE Wireless. Worldwide distribution expanded during the quarter as Vicinity expanded its sales force and opened offices in Germany and France. These offices, together with an office soon to open in the United Kingdom, are designed to leverage existing multinational customers as well as capture a greater share of the emerging global market. In a recent interview the very interesting, talented and intelligent CEO, Emerick Woods said, "We believe we now have the team, the technology, the partners and the resources to become one of the undisputed leaders in Internet-based marketing infrastructure services."
The company’s strategic alliances include Inktomi (NASDAQ: INKT), Palm Computing (NASDAQ: PALM) and is a member of the Phone.com (NASDAQ: PHCM) Alliance Program. There is so much synergy here, I feel like I am getting an all over body massage. The deals and the potential here are incredible. Going back to the OmniSky deal mentioned above, Vicinity’s "Brand Finder data" will be available to millions of Palm V users. This is what we bought when Blackberry wouldn’t even answer their phones (see #7 below). I hope this technology will also available for Palm VII and new versions of Palms. The president of OmniSky, Barak Berkowitz said, "Highly useful local content is key to the overall wireless consumer experience OmniSky provides. Our users are moving quickly and are mission-oriented so they crave the kind of valuable information and tools Vicinity and OmniSky have teamed up to provide. The result is a comprehensive and meaningful wireless Internet experience."
New as a category, but very prescient in the world of wireless communications is the C2C category. This is the personification of the "many to many" network effect. Consumers communicating with consumers. The number of e-mail boxes is expected to increase to 531 million globally by 2002, up from 351 million, according to IDC. And 50 percent of all wireless phones will be Web-enabled by the end of this year. I can't think of what number that is when the whole world, 5 billion people is on the Internet. In this space we have:
7. Critical Path
Critical Path reaches more than 100 million end-users through its customer relationships and more than 25 million wireless devices. In a bid to play a role in the growing use of e-mail and mobile devices, Critical Path is partnering with Aether Systems to jointly develop and market messaging solutions via wireless devices. As part of the alliance, San Francisco-based Critical Path (CPTH: news, msgs) and Aether Systems (AETH: news, msgs) will develop the interfaces necessary to combine Critical Path's messaging system and Aether's wireless data technology. A wireless deal reflects the growing demand for unified messaging and Internet protocol voicemail solutions via wireless devices, said Rick Juarez, an analyst at Robertson Stephens. "Ultimately, Critical Path could be at the forefront of the convergence of voice and the e-mail networks." Additionally, Aether will assist Critical Path in becoming a reseller of Research in Motion (RIMM: news, msgs) Blackberry wireless e-mail solutions. These Blackberry products are in very high demand. You can almost forget trying to buy them. They are so busy they can’t even answer their phone. I know because I tried to buy one of these and gave up.
8. Tribal Voice, UBID and 1st UP
Tribal Voice is CMGI’s instant messaging company competing against AOL. Tribal Voice delivers a desktop-to-mobile phone wireless instant messaging service complete with presence detection; and a multimedia player with built-in interoperable instant messaging. DW announced during the CC that Tribal Voice is teaming up with UBID to provide instant messaging for auction results. UBID is a leading online auction and e-commerce site that offers consumers and small- to mid-sized businesses the opportunity to "set the price" on a wide range of brand name merchandise through live-action bidding using sophisticated auction technology. The company's Internet auctions feature a rotating selection of more than 6,700 items in each daily auction. Consumers can browse in more than 12 different product categories, including: computers, consumer electronics, home and leisure, sports and recreation, jewelry and gifts, apparel, appliances, art, travel and events, home improvement products, monitors and printers, and off-lease computer equipment.
Now UBID is partnering with 1stUp which is a leading provider of private label Internet access solutions. UBID will be able to offer its million customers free Internet access from 1st Up and wireless instant messaging from Tribal Voice.
All of the above categories, B2C, B2B, B2B&C, C2C relate to content and delivery systems to specific markets to meet specific needs. Infrastructure investments underlay all that. They are the roads for everyone to travel on regardless of where they are going. Inktomi released figures that show total investments in wireless startups to be around $800 million in 1999. This is a party everyone wants to go to. Infrastructure investments are further broken down into hardware, software and enabling technology.
Navisite and Mobile Logic fall into the hardware categories. Software is a new and fascinating game called "natural language processing". This is the whole technology of how we talk to our phones, palms and the voice activated email in our cars and how these appliances talk back to us. @Ventures has been very active in this pioneering area. They have investments in 2 companies, Dejima and Answer Logic. Enabling technology is how the device interfaces with its server host. DW referred to wireless devices and the "ultimate edge server". These appliances will hold the profiling and content preferences of the user. I can check my RB email when I call from my cell phone as an example.
Now ya can’t watch the fashion show without seeing Tyra Banks. In fact we all can't wait to see the star of the show. In the wireless space, the "biggest" and best is infrastructure. Are you |
