Going Mobile: The Year of the Smart Phone Startup
Thursday, February 14 2008 @ 06:17 PM CST
Contributed by: Andy Updegrove
If you've always been itching to launch a startup but just couldn't come up with a killer idea, well, your ship is about to come in. No, it won't be quite as good as the Internet Bubble years, when any fool could raise a few million (hell, $30 or $40 million) to sell dog food online - no, really - but not bad, either.
When things are more or less steady state, you have to do something new and original to have a viable business plan in the tech space. But when times and technology really change (one of those paradigm shifty things), then you don't actually have to come up with something new to do at all - you just have to be the first to do something old in a new way. If you look back, that's what 95% of the Bubble companies tried.
True, 95% of those companies also failed. But that's not likely to happen this time around. This time, things will be a lot different, because while the platform is new, almost all of the trial and error on the business models has already occurred, the users are already trained to eat the dog food (as it were), the money is primed to flow, the standards are in place - and here's the really new twist - open source software has made the scene.
So where exactly is this grand opportunity to be found? I expounded on it in my monthly column for MHT (formerly MassHighTech), the New England high tech paper, last week in a piece that reads in part as follows:
The market segment in question is the mobile sector, where 2008 will usher in a multiyear period of opportunity for entrepreneurs and investors. The dynamics will echo two boom periods of the past -- the rapid expansion of the PC marketplace in the early 1980s, and the Internet explosion of the late 1990s. The device that will most robustly deliver on these antecedents is the smart phone, initially deployed (like the first personal computers) with many competing operating systems, and now able (like the PCs of the Internet boom) to satisfactorily access the Internet and the web.
In many ways, however, this boom will be better. Unlike the early, anemic, expensive PCs that people had never used before, a smart phone is simply a much more versatile telephone -- something a billion people already own. With a decade of Internet and web experience behind us, there will be far fewer failed efforts to determine what people really will and won't do online. And these mobile devices will be able to perform new tricks, using as many as nine separate on-board radios to interact with an ever-expanding "Internet of things," such as ATMs, film kiosks, movie posters and much more.
Best of all, the underlying technology is far less proprietary than it was during either the PC or the Internet boom. Various flavors of Linux now power the majority of mobile devices, and the Google Android project aims to provide developers with platform independence as well. The final part of the equation fell into place in just the last few months, as dominant telecommunications carriers grudgingly came to realize that they are better served (assuming they still have a choice) by opening their phones to independent software vendors than by shutting them out.
The result is a wonderful convergence of factors creating rapidly accessible opportunities for startups -- an abundance of empty open standards and open-source-based niches, alignment with the strategic direction of giants such as Google Inc. and Motorola Inc., and a coincident industry shift toward provisioning software as a service. Hundreds of opportunities -- many obvious -- offer all types of services to mobile, locationally aware platforms, from social networking, to push advertising to financial services.
Do I really believe all that? Yes I do. I don't expect that it will reach full flower in 2008, but I definitely expect the bus to leave the station and pick up real speed this year. It's going to be a very big bus, and most of the seats are still empty.
Just don't try and sell Kibble (R) to Smartphone users. We already know that dog won't hunt.