How Will Mobile Solutions Evolve and Provide Value to Customers?

Customers will not accept and adopt mobile technology if they don't derive tangible benefits from it. Customer value creation will most likely occur in five solution phases that correspond to the evolution of mobile technology.

In the first phase, mobile technology provides value through messaging, or the ability to interact with others. Short message service (SMS) is extremely popular on two-way pagers and mobile phones. We estimate that 80-90 percent of worldwide wireless data subscribers subscribe to SMS. The next stage in the development of messaging technology is to give users direct access to corporate e-mail accounts. However, significant improvements in the data rate, memory, and storage capacity of wireless devices need to occur before corporate e-mail access displaces SMS as the messaging tool of preference.

During the second phase, mobile technology enhances users' connectivity to information. Unlike messaging, the ability to access and retrieve information from the web requires a mobile device to maintain a real-time connection to the Internet. This capability already exists, but the quality of information currently available is poor. Much of the information is free and "nice to have." At a minimum, wireless browsers need to become commonplace before this phase takes off.

In the third phase, the business world finally accepts that mobile technology is here to stay and realizes value from transacting business via the mobile channel. Rather than applying a quick-fix approach to achieve a wireless web presence, corporations need to develop an m-commerce strategy for extending and growing revenue-generating wireless transactions. The customer is a different entity in the mobile business model: They are identifiable, locatable, and immediately in "buying mode" once they turn on their wireless device. Growth in the third phase is unpredictable and very dependent on a few killer applications. In this phase, corporate mobile strategies frequently evolve and mutate.

The fourth phase is transformation, which happens when companies connect business processes within the enterprise, as well as between organizations. For the notion of "business without boundaries" to prevail, back-end applications and data must be re-engineered to take complete advantage of the features mobility offers. Implementing mobility-enhanced internal and external business processes is the most difficult aspect of the m-business revolution. It is also where the largest gains in true economic and business value will be found.

The fifth and final phase is infusion. In this phase, companies realize value when they absorb mobility as part of standard business practice. Infusion dictates a shift from a culture in which technology is merely occasionally present to one in which technology is an accepted part of business. Infusion requires companies, their employees, their suppliers, and even their customers to re-engineer business processes and relationships to acclimate company culture to the technology's presence. During this phase, tremendous industry consolidation usually occurs. Weak players either die or are bought out, similar to the business-to-consumer e-commerce consolidations of 2000 and the business-to-business e-commerce consolidations of 2001.

Today, mobile companies are in the first phase (messaging). Moving from one phase to the next is dependent on the user adoption rate of the mobile Internet, which, in turn, hinges on how well the software applications it provides meet customer needs.

Shifts from one phase to another are difficult to predict. In 1985, had you asked people if they were ready for fax machines, cell phones, or personal computers when they first came out, they probably would have said "no." Many customers don't buy technology; they buy applications to solve a need. The mobile industry has a responsibility to demonstrate the usefulness of its products and services to consumers. If this demonstration provides compelling business and personal reasons for adopting a mobile business lifestyle, sales will take care of themselves.

Business Applications, Not Technology
What do customers really buy? Not operating systems, processors, or architectures. They buy applications, performance, and useful solutions. The mobile channel can move forward only with new applications that enhance the overall customer value. Consider the following hypothetical scenarios where mobile technology is enlisted to solve a business problem:

• While traveling, a pharmaceutical sales representative receives a customer request for a larger-than-anticipated order. She uses a pocket PC to immediately confirm the availability of additional inventory and the timing for delivery in order to capture a larger sale.
• After notifying its customers of an investment opportunity in a software company's initial public offering, an online brokerage service receives and executes a buy order sent from a customer's web-enabled phone while she commutes from work.
• An on-the-go executive monitors e-mail via her cell phone, which is programmed to poll her e-mail accounts. After discovering that she has new e-mail, she accesses it via a toll-free number, and it is read to her by a text-to-speech utility.

These scenarios outline how mobile technology is changing from being "nice-to-have" to "need-to-have," or strategic to corporation applications.

The convergence of the Internet and wireless connectivity offers companies the opportunity to leverage their existing web infrastructure investments and extend the reach of their web-based applications and content to their mobile customers, employees, suppliers, and business affiliates. The applications that once resided exclusively on the desktop - everything from word processing to industrial-strength enterprise software packages - are being modified to be delivered across wireless networks to a variety of devices, including laptops, palmtops, and tablets.

The major challenge facing all mobile applications will be the ability to deliver as holistic a user experience as is currently attainable online through the limits of a handheld device.