EQO Communications, a communications company based in Richmond, British Columbia (just outside of Vancouver), that made waves at Demo 2006 and raised a total of $13 million in two rounds of funding from GrowthWorks, BDC Capital and Ventures West, is rumored to have cut nearly 65 percent of its work force — reducing the number of employees from 35 to 12. The news was reported by Techvibes, a Canadian startup-related publication. I have called their marketing manager for a comment but had not heard back as of press time.
When it launched, we were intrigued by EQO because it was one of the first clients out there that allowed you to make Skype calls from a regular phone. Making Skype mobile was an opportunity that slipped away from EQO mostly because competitor iSkoot was better funded and had a better execution strategy. In August 2006, EQO got into a bit of a tiff with Skype. The company then refocused on social networks, but it seems even that strategy didn’t go anywhere. EQO raised another $9 million in August 2007.
Funny thing about these rumored job cuts is that the company has been supporting more and more mobile phones and was supporting all high-growth devices. The job cuts, if true, don’t bode well for the long-term health of the company. VoIP as an industry has proved to be hard nut to crack for startups, especially those aiming for the consumer market. Jangl and TalkPlus were two startups that hit the deck earlier this year. We are going to see more of these “save money on LD” phone apps with no discernible business model and relatively little traction or loyalty to follow suit.
* Approximately

A report from Forrester out today highlighting the rise of “mobile wannabes” in the work force is a bit over-the-top in its assertion that up to 25 percent of the 2012 workforce will be folks who don’t need mobile access to company information but will want it. The report cites the example of employees angling for mobiles to complete work on their commutes. I hope these mobile wannabes are taking the train or bus to work, because I don’t want some 25-year-old admin in the highway lane next to me filing a report for her boss.
However, the report correctly identifies Millennials as the catalyst for this trend. Millenials are the under-30 generation that grew up with the web and mobile technology, and as such they expect and want mobile access in order to do their jobs — not because they want to work more, but because they expect to be able to do their jobs while taking care of routine tasks outside of the office. Companies should support them, rather than lock down IT policies.
While I was at DEMO last month, I saw one or two startups attempting to offer secure access to enterprise data from cell phones, including SkyData. Also in the security space are companies such as CoreTrace, which manage applications on a employee desktop by creating a whitelist of approved file types and refuting those that don’t match. That approach would help with younger workers’ habits of downloading random Web applications onto company computers.
As the economy worsens, giving mobile wannabes a mobile lifeline back to the office could also give employers the flexibility to offer lower salaries — after all, surveys consistently show that flexible scheduling is of far more interest to employees than more pay. Investing in products to make workers more productive and keep data secure seems like a win-win.


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Kineto Wireless is like the Energizer Bunny, it just keeps going and going. Today the Milpitas, Calif.-based startup said it has raised $15.5 million in additional capital. The round, which included funding from Motorola as part of a broader commercial relationship with the handset maker’s home and networks mobility business, also involved Kineto’s existing investors Oak Investment Partners, Sutter Hill Ventures, Venrock, Seapoint Ventures and InterDigital. An earlier investment from NEC will also tie in with this round. Kineto will use the funding to keep pushing its UMA technology beyond dual-mode handsets and work on a new technology for femtocells.
Kineto’s UMA technology basically provides a software link between unlicensed wireless services, such as Wi-Fi and cellular data networks. It has been used in dual-mode handsets to bridge Wi-Fi and cellular networks, most notably in T-Mobile’s Hot Spot@Home product, and now the company is trying to land it a starring big role in the 3G and 4G femtocell markets. Femtocells, which are personal cellular base stations hooked into a consumer’s existing broadband connection, help boost coverage inside homes and can also be used to offload some traffic from a carrier’s wireless 3G network. In 4G networks, femtocells might be used to bridge gaps in coverage.
Kineto worked with NEC to create a standard to connect femtocells to the home computing network that was based on its UMA technology. However, the companies involved in the standard-setting effort chose a different way to connect femtocells to home networks, and will publish a complete standard in early 2009. This latest round of funding should enable Kineto to support femtocell development and deployments for vendors such as NEC and Motorola as carriers and equipment makers figure out the best way to build out and support wireless broadband networks.

Updated. In the same way that mobile access to Wikipedia has transformed stupid arguments, mobile song recognition apps are truly neat when you need to name that tune. While they’ve been around for a while (though they didn’t always work so well and sometimes they cost money), the interface of the iPhone and the prominence of Apple’s App Store has given them a big boost. Today, Shazam (where you can hold your phone up to a speaker to analyze what song is playing) and Midomi (where you can do the same, but you can even sing the song yourself and listen to other users’ renditions as well) are No. 27 and 71, respectively, in Apple’s most-downloaded free apps. And now Midomi’s parent company, San Jose, Calif.-based Melodis, says it has raised $7 million in Series B funding.
The funds were provided by TransLink Capital, JAIC America and Global Catalyst Partners, and will be used to distribute and monetize the company’s music search products. Melodis has now raised a total of $12 million.
In my extensive tests (which were not so extensive, because I don’t own an iPhone — but were more extensive than you might think, because I’ve convinced many people to download Midomi), the app works really well for most pop music (but not at all for classical). It’s an awesome party trick. However, some reviewers have found Shazam to be more accurate.
Update: Shazam has raised nearly $20 million in funding, but it hasn’t taken new funding in four years, the company told us Tuesday morning. also recently raised funding — some $6.6 million from IDG Ventures Europe, Lynx Capital Ventures, and Soft Park — though we don’t know how much it’s raised in total.

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GigaOM readers are well-versed in both the wireless broadband networks that carriers are building and the Wi-Fi gear that we use in our homes, but what about the wireless technology that is starting to manage energy for the power grid as well as energy use within our homes? Sensor technology and wireless networks can provide disruptive innovations and increased transparency for the energy industry, enabling utilities to make the grid smarter and help consumers slash energy use.
Here’s our pick of five startups that are using wireless in innovative ways to change the energy landscape.
Eka Wireless: Eka is an eight-year-old company that develops wireless mesh networks to help utilities deliver energy conservation services. Eka’s wireless mesh networks use open, non-licensed spectrum and supply embedded nodes for so-called smart meters, digital two-way electricity meters that help utilities share price information with energy customers. The company is based in Maryland, has more than 65 employees and has raised $40 million in total from investors, FlyBridge Capital Partners, Angeleno Group, RockPort Capital Partners and The Westly Group.
EnOcean: This German company that was spun out of Siemens in 2001 makes “battery-free” wireless sensor networks that use energy-harvesting technology and low-power radios to cut down energy use in buildings and homes. Sensors can do everything from detecting presence in rooms (i.e., shut off lights when not in use), to transmitting data about temperature, lighting and individual appliances throughout a building. EnOcean’s energy-harvesting technology turns tiny amounts of energy — from pressure, vibration and changes in temperature — into useable electricity for the network. The company has raised €20 million in funding from Wellington Partners, 3i Group, Emerald Technology Ventures, Siemens Venture Capital, Siemens Technology Accelerator, BayTech Venture Capital and ATMOS.
Ember: Ember, a company founded in 2001 and backed by Ethernet inventor Bob Metcalfe, makes the building blocks — chips, gear and software — of ZigBee-based wireless networks. ZigBee is a wireless standard that has gained a lot of traction for use in energy monitoring networks because the technology is low power, low bandwidth and low cost. Based in Boston, Ember has raised $81 million raised from Polaris Venture Partners, GrandBanks Capital, RRE Ventures, Vulcan Capital, DFJ ePlanet Ventures, DFJ New England, WestLB Mellon Asset Management (formerly West AM), ChevronTexaco Technology Ventures, Hitachi Corporation, Stata Venture Partners and MIT. Based in Germantown, Mnd., Ember has reportedly raised $40 million from the Angeleno Group, Rockport Capital Partners, Flybridge Capital Partners and The Westly Group.
SmartSynch: Smart meters are the connection between the utility and the power user. SmartSynch’s technology uses makes current wireless networks, like cellular and Wi-Fi, to connect the utility to the smart meter. Using those networks is cheaper and faster to deploy smart-meter services, explains SmartSynch. The company has raised $80 million from Credit Suisse, Southern Farm Bureau Life, Battelle Ventures, Beacon Group, Endeavor Capital Management, GulfSouth Capital, Innovation Valley Partners, Kinetic Ventures, OPG Ventures, Nth Power, JP Morgan Partners, Siemens Venture Capital and Duke Ventures.
MMB Research: This small, young team of developers found they were consulting so much on ZigBee wireless networks and applications that they decided to create a company to sell ZigBee development software and services. As ZigBee has become the leading standard for home energy monitoring systems, more companies will have to learn how to develop for it. Why not get some help? The Toronto-based company is bootstrapped but says it could start looking for funding sometime next year.
Interested in knowing more? Check out the first Earth2Tech Briefing on “The Smart Energy Home,” 23-pages of detailed information about up and coming players that are using information technology to deliver the next-generation smart.

Mobile Internet adoption is still rather slow. According to Forrester Research, only 21 percent of U.S. adult mobile phone owners use the mobile Internet, and only 7 percent do so at least once a week. One of the main reasons for this is that browsing the Internet through a mobile phone is kind of like eating soup with a fork – that is, using the wrong instrument to get the job done.
To provide an adequate mobile Internet browsing experience, it’s not enough to shrink the web page into a size that fits on a mobile phone screen. A web site designed for the mobile Internet should consider the different keyboard, the lack of a mouse-like pointing device and the different context; if it can wait until a user gets home, it probably will. So, how do we make the mobile Internet work well on different handsets with different screen sizes and different operating systems?
One solution is offered by Israeli startup Moblica. Founded in December 2007 with a seed investment of $700,000 from angels, Moblica aims to bridge the gap between the richness of Internet services and the limitations of mobile devices to offer an iPhone-like experience on Java-enabled mobiles. Moblica takes relevant web sites and redesigns them to give customers a better mobile user experience.
After downloading the Moblica application, users are presented with an iPhone-like desktop that contains different mini applications, such as weather forecasts, RSS feeds, Picasa pictures and more. Navigating is easily done using the keys, and pages load very quickly. Currently only Picasa and RSS are available, but Moblica says many more are set to launch by the end of the September, along with a consumer web site. Moblica says it can work with content providers to develop a mini-application version of their site in one to two weeks. The downside is that the Moblica solution currently only works on Java-enabled phones. Still, seeing these efforts to improve the mobile web experience leaves me eager to throw away my fork.
Moblica’s competitors include WidSets by Nokia, which also provides a downloadable application that contains different mini applications. While WidSets currently offers many more sites, after seeing both applications in action, I can say that I definitely had a better user experience with Moblica. An additional competitor is Volantis, which provides automatic content adaptation services for mobile operators.
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We’re obsessed with synchronizing content between computers, and SugarSync from Sharpcast not only syncs regular documents and photos between computers, but also between mobile phones. So it’s fitting that we let you know that Sharpcast has announced an iPhone app available free to anyone who subscribes to the SugarSync software. Consumers can use the iPhone to access their SugarSync file repository online and manage or view files on all their computers. For a complete rundown of SugarSync, check out the review at Web Worker Daily.
Om thinks having an iPhone app gives Sugar Sync (and Buffalo, which offers remote access to its storage drives through an iPhone app) a real competitive advantage against folks like Dropbox or FolderShare. I’m not sure I agree with him. He’s right when he says storage startups are a dime a dozen, and have to do something to stand out from the crowd, but the iPhone is still an aspirational and consumer device. Plenty of people don’t have them yet. Small business owners are the ones buying Buffalo drives, and given the troubles with MobileMe they might wait before taking on the iPhone. Adding more smart phone access beyond the iPhone would be a better way to stand out in my opinion, but I might just be a bitter Blackberry owner.
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My Chicago-based startup, The Point, helps people start campaigns for collective actions of all kinds, from organizing a poker game to boycotting a multinational corporation. We’ve been fortunate so far, enjoying steady growth, happy users, and money in the bank. (In February, we raised a $4.8 million round of venture funding from New Enterprise Associates). But hindsight is 20/20 and any entrepreneur, given the chance, would do some things differently.
In our case, we spent nine months developing extra features to accommodate our grand vision instead of focusing on what our users would really need. This cost us precious time, delaying our launch, originally planned for June 2007, to November of that year. Even after launch, the costs lingered — maintaining the extraneous features was a time-consuming distraction from improving the parts of The Point that people were actually using.
Thankfully, we caught on to what I call the curse of “vision overload” — when you put your vision ahead of your users — and quickly reversed course.
This month we’re delivering a major upgrade to The Point, our first release in months, and we’ve actually cut more features than we’ve added. While arguably less grand, it adheres to the critical success maxim of KISS, or “Keep it Simple, Stupid!” All founders face an inherent conflict between their most ambitious visions and the practicalities of execution. Below I explain how The Point addressed this uncomfortable compromise, and how you can learn to KISS, too.
Why didn’t we adhere to simplicity the first time around? We were certainly aware of the KISS principle — in fact, it was uttered frequently around our office — but we didn’t know how to measure simplicity. Obviously a site needs some core features, but where do you draw the line on value added? Our vision was to build a 21st century framework for collective action. This was novel, so how do you determine what is core vs. an enhancement?
The complexity occurred when we allowed vision to drive our feature set. Six months on, we’ve developed a few rules for determining what to leave in and what to leave out at launch.
1. If you don’t mention it in your 2-minute product demo, you don’t need it.
Whether demoing to colleagues or potential investors, we found ourselves glossing over certain features to keep from overwhelming our audience. In the end, the features we skipped over were the same features that went unused. If you can’t fit it into a presentation to a captive audience, then it’s almost guaranteed not to be a factor in the seven seconds the average web user takes to decide whether they’re interested in what you’re doing.
2. Don’t build a race car for foot runners.
Campaigns on The Point don’t go “live” until engagement reaches a critical mass (e.g. 100 participants), so everyone can be assured the campaign will have an impact. So to help organizers determine the tipping point for a boycott, we built a database of 150,000 companies that maps the financial vulnerabilities of boycott candidates like The Gap or Exxon Mobil. Users, however, were efficiently identifying potential targets through simple discussion forums. They didn’t need the fancy tools we had created.
3. Let users problem-solve with the basics first. Then offer the glitz.
We assumed that some campaign creators would want multiple administrators so they could share the responsibilities of management and promotion. Our vision for The Point included group governance, so we spent weeks building a system for proposing and voting on campaign developments. As soon as we launched, we realized that campaign creators managed this task just fine by sharing access to single accounts. The lesson? Sometimes it’s better to let users actually have a problem before you try and fix it; their solution is often simpler.
4. Proselytize your vision in your blog, not your product set.
There are better ways to promote your vision than etching it into your product with features that are unlikely to be used. Write about it on your blog! Speak with community groups on the purpose and potential of the site. Or make a video of yourself in the future talking about how your site changed the world.
Users care about whether you are meeting their needs, not your vision for the company. Save your vision for your investors. Had we focused on the factors that affect whether someone will become a user, we would have had a product out the door months earlier.

Andrew Mason is a blogger and founder of The Point. It is his first startup.

Mippin (formerly Refresh Mobile), whose browser-based site presents content specially designed for mobile consumption, says it has named a new CEO and reached a milestone of 500,000 users. But I question its ability to survive.
The London-based startup’s service also learns what users like and recommends stories based on their previous interests. I call it a mobile portal analogous to Yahoo, MSN, Netvibes or PageFlakes, but Judy Gibbons, the new CEO, has a different definition. She says it’s a mobile media services company, in that it optimizes PC content for consumption on a mobile device. “We believe there is only one Internet - there is not a separate mobile one,” Gibbons told me via email. “But mobile presents different challenges and opportunities and there is real user value to having all this content in one place in the same consistent format with a great fast user experience.”
Whatever you call it, Mippin needs to gain wide adoption in a crowded area to support its advertising-based revenue model. The market includes efforts by Yahoo, Microsoft and Google, and according to ad network AdMob — which does business with Mippin — the number of mobile portals is steadily rising (see graph). Obviously the mobile world cannot support 500 varying portals. Even in the PC web world, portals have problems.
Despite impressive growth from its October 2007 launch, averaging 110 page views per user and advertising click-through rates of 3 percent and 15 percent for contextual ads, (way better than the .5 percent rates on other mobile sites), I’m not sure Mippin will deliver the audience advertisers need given the amount of competition fighting for consumers’ eyes. It’s a nice service, but unfortunately that doesn’t always win out.

Mippin (formerly Refresh Mobile), whose browser-based site presents content specially designed for mobile consumption, says it has named a new CEO and reached a milestone of 500,000 users. But I question its ability to survive.
The London-based startup’s service also learns what users like and recommends stories based on their previous interests. I call it a mobile portal analogous to Yahoo, MSN, Netvibes or PageFlakes, but Judy Gibbons, the new CEO, has a different definition. She says it’s a mobile media services company, in that it optimizes PC content for consumption on a mobile device. “We believe there is only one Internet - there is not a separate mobile one,” Gibbons told me via email. “But mobile presents different challenges and opportunities and there is real user value to having all this content in one place in the same consistent format with a great fast user experience.”
Whatever you call it, Mippin needs to gain wide adoption in a crowded area to support its advertising-based revenue model. The market includes efforts by Yahoo, Microsoft and Google, and according to ad network AdMob — which does business with Mippin — the number of mobile portals is steadily rising (see graph). Obviously the mobile world cannot support 500 varying portals. Even in the PC web world, portals have problems.
Despite impressive growth from its October 2007 launch, averaging 110 page views per user and advertising click-through rates of 3 percent and 15 percent for contextual ads, (way better than the .5 percent rates on other mobile sites), I’m not sure Mippin will deliver the audience advertisers need given the amount of competition fighting for consumers’ eyes. It’s a nice service, but unfortunately that doesn’t always win out.

SMSGupShup, an SMS-based group messaging/microblogging service from Webaroo, is close to announcing that it has raised $10 million in new capital from Helion Ventures and Charles River Ventures. News of pending deal was first reported by some blogs in India. In its original form, Webaroo — a startup co-founded by Rakesh Mathur, formerly of Junglee, and Beerud Sheth, formerly of eLance — was going nowhere fast, until the company launched the SMSGupShup service, which has taken on a life of its own in India. (Disclosure: Rakesh is an investor in the parent company of this blog.)
I use the SMSGupShup service to send alerts to our readers in India, and our reach has been growing like a weed — much like the service itself. Here’s a link to my GupShup channel, in case you want to sign up. SMSGupShup is, according to some estimates, about seven times the size of Twitter in terms of users and about three times as big in terms of daily SMS messages. It rarely has outages because, as its name suggests, it is almost entirely focused around SMS.

The move to 4G will not be cheap. Carriers must consider network upgrade costs and a refresh of their handsets, not to mention the issue of backhaul. Will they attempt wireless backhaul? Wait for fiber? One way or another, by 2013 carriers worldwide will invest some $163.5 billion in capital expenditures, with much of that going to 4G data services, according to data out today from ABI Research.
In the meantime, carriers in developing countries will be spending about $131 billion on 2G and 3G upgrades this year, while carriers in mature markets will start throwing their money at 4G in 2009. By 2013, carriers will spend about 28 percent for voice, 67 percent for data, and 5 percent for mobile TV.
Israeli chip startup DesignArt hopes to cut those costs with a line of base station chips for carriers that, when used in a clustered network, can essentially create their own backhaul. The other innovative aspect of the firm’s chip design is the fact that everything from radios to backhaul is on one chip. That system-on-a-chip design can cut both costs and the form factor of a base station, enabling equipment makers to use the chip in pico cells to base stations. It does this using 3 watts of power.
The company is currently sampling a WiMAX version of its chip, which will go into production next month; it plans to offer an LTE version later on. Motorola is checking out the chip and is also an investor.
Two things struck me about DesigArt’s chip: The first is that the time it will take them to bring it from idea to production is a mere 18 months, incredibly fast for the chip industry, where that time frame can run two years or more. The second is that, with so many functions on it, this single chip could prove a challenge to many of its competitors.
Joachim Hallwachs, VP of marketing for DesignArt, said the use of ARM cores, Tenscilica-embedded processors and its own customized RISC-based core all contributed to shorten the time needed for both design and integration. As for the competition, the firm will take on Intel, Texas Instruments, Freescale, Sequans, picoChip and Wintegra with its various components. The spending on 4G is just beginning, but if equipment makers buy into DesignArts’ semiconductors, the company may end up displacing a lot of chip makers.

The move to 4G will not be cheap. Carriers must consider network upgrade costs and a refresh of their handsets, not to mention the issue of backhaul. Will they attempt wireless backhaul? Wait for fiber? One way or another, by 2013 carriers worldwide will invest some $163.5 billion in capital expenditures, with much of that going to 4G data services, according to data out today from ABI Research.
In the meantime, carriers in developing countries will be spending about $131 billion on 2G and 3G upgrades this year, while carriers in mature markets will start throwing their money at 4G in 2009. By 2013, carriers will spend about 28 percent for voice, 67 percent for data, and 5 percent for mobile TV.
Israeli chip startup DesignArt hopes to cut those costs with a line of base station chips for carriers that, when used in a clustered network, can essentially create their own backhaul. The other innovative aspect of the firm???s chip design is the fact that everything from radios to backhaul is on one chip. That system-on-a-chip design can cut both costs and the form factor of a base station, enabling equipment makers to use the chip in pico cells to base stations. It does this using 3 watts of power.
The company is currently sampling a WiMAX version of its chip, which will go into production next month; it plans to offer an LTE version later on. Motorola is checking out the chip and is also an investor.
Two things struck me about DesigArt’s chip: The first is that the time it will take them to bring it from idea to production is a mere 18 months, incredibly fast for the chip industry, where that time frame can run two years or more. The second is that, with so many functions on it, this single chip could prove a challenge to many of its competitors.
Joachim Hallwachs, VP of marketing for DesignArt, said the use of ARM cores, Tenscilica-embedded processors and its own customized RISC-based core all contributed to shorten the time needed for both design and integration. As for the competition, the firm will take on Intel, Texas Instruments, Freescale, Sequans, picoChip and Wintegra with its various components. The spending on 4G is just beginning, but if equipment makers buy into DesignArts’ semiconductors, the company may end up displacing a lot of chip makers.

I’ve been in Tel Aviv for almost two days and I still haven’t been able to shake off the jet lag, mostly because I’ve been so busy catching up with old friends, making new ones, and learning all I can about what’s going on in this tiny country, which has the highest number of startups outside of Silicon Valley. Here, working for a tech company is as much a part of life as being a member of the Israel Defense Forces.
I typically write about a startup after hearing about it from many different sources. It doesn’t matter if the chatter is positive or negative; if people make mention of a company, unprompted, in casual conversation, there’s almost always a good story behind it. These days Israelis are talking about Modu.
According to the chatter that I’ve heard while sitting in cafes and bars here, Modu, which was started by M-Systems founder Dov Moran (who sold that company to SanDisk for $1.6 billion), may already have or is close to raising a whopping $100 million from investors including some of its partners. The Kfar-Saba, Israel-based company has backing and relationships with SanDisk, Texas Instruments, Telecom Italia, BeeLine (VimpelCom) of Russia and Cellcom of Israel.
When I asked Guy Horowitz, director of strategy for Modu, about the funding, he declined to comment. Regardless, the chatter isn’t focused on how much money the company might be raising (it’s already raised $20 million from investors including Gemini Israel Partners and Genesis Partners). Modu is the first Israeli startup aiming to hit a home run in consumer electronics.
Modu has developed a tiny, 2.5G mobile phone — about the size of a cigarette lighter — that uses a Texas Instrument chips to pack in features including music playback, FM radio, GPS and of course, tons of memory.It is a mobile phone module that can be inserted into a sleeve. And depending on which sleeve it’s inserted into, its feature focus will change.
A sleeve with a focus on music can turn the phone into a music player. A sleeve with a Qwerty keyboard can turn it into a messaging device. What makes it possible is a tiny connector port hidden at the bottom of the device that interfaces with these sleeves.

“We are taking our cues from the fashion industry,” says Horowitz. Indeed, just like fashion changes every season, people can swap and change their sleeves but keep the basic innards of the phone — with all information, such as address book and music, intact. With each different sleeve, while basic functionality remains the same, the focus shifts to another function. And in the same way that you buy shirts from, say, Banana Republic or Faconnable, Mobu hopes that one day you’ll be able to buy these sleeves not just from them but also from retail stores, carriers and even small, specialized designers who will come-up with sleeves.
“Today it takes about 12 to 18 months to bring a phone to market,” says Horowitz. “And phone companies need to sell millions of units to recoup profits.” Modu, in comparison, can build and bring sleeves to market in less than a quarter — and they only need to sell some 100,000 of them to make money. From that perspective, their plan seems quite logical.
But Modu still has lots of work to do. After launching at Mobile World Congress in February, it has yet to deliver a product. It plans to launch its phone sometime this year, but it will only be a 2.5G version. A 3G version won’t be ready until 2009.
I think the lack of a 3G device is going to prevent Modu from getting any meaningful traction. Apple, while a newcomer to the mobile market, was able to buy time for a 3G version, mostly because it had a strong brand and a loyal cadre of fanboys (and gals.)
The lack of a well-known brand will prove a challenge for Modu, especially since the company is aiming for fashion-conscious users. While these consumers can afford to buy new sleeves to “show off” their expensive toys, this same group is almost perversely married to “brands” and would pay a premium for them. Carrier-branded phones, on the other hand, might not hold as much appeal. As a result, Modu needs to get a lot of “brand names” to develop “sleeves.” And in order to do that, it needs to spends tens of millions of dollars.
Horowitz said the company’s carrier partners are going to be spending millions to promote Modu devices because it would allow them to push mobile brands into the background. I wouldn’t hold my breath, for carriers’ loyalties are worse than the fidelity of a free agent in baseball.
Finally, Modu is going up against entrenched players with deep pockets, who can use discounts as a way to destroy the company’s plans. And a desperate handset maker, like Motorola, could always copy Modu’s idea.
But at least it makes sense why this company needs more than $100 million in VC backing. In fact, I get the feeling that it won’t be enough. Still, the fact that they’re doing something this audacious makes their story one worth following.
How Modu Works:
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Vlingo’s new software for BlackBerrys (the link goes live at 5 a.m. PT), which gives me the ability to navigate my phone entirely by voice, has me feeling like a kid on Christmas morning. I press a button on my Pearl, wait for a chime, simply say, “Web search, weather San Francisco,” and the browser opens and delivers me the weather in San Francisco. I can also use it to text and send emails to my contacts, though admittedly without the benefit of typing, punctuation is a problem.
As Om has pointed out, voice makes navigating phones easier, but the Vlingo application does eat up bandwidth. Regardless, the Vlingo software for BlackBerry devices is powered by the same speech recognition engine behind Yahoo’s oneSearch, the voice-enabled web search software that had me so excited I downloaded it in the middle of the keynote speech introducing it.
With the ability to text and email by voice, the Vlingo software has more features than oneSearch, but in return I’ve given Vlingo voice control of my entire phone. And that poses a problem for Nuance Communication, the leader of speech recognition software for dictation and for mobile phones. Nuance powers my BlackBerry’s voice dial feature — or at least it did until I downloaded the Vlingo client. (Device-wise, for now the software is only available for BlackBerrys.)
Both Nuance and Vlingo are going after deals with carriers because that’s where the money and reach are. Vlingo hopes to sign deals with partners to make them the default option for voice-powered commands such as web search or directory services. It’s popularity so far may be one of the reasons Nuance earlier this month filed a patent infringement lawsuit against Vlingo.
Vlngo’s CEO Dave Grannan says the suit is without merit; he also recently raised a $20 million round of funding, which he says he’s willing to use to fight the infringement case. However, infringement suits are a messy business and have long been used as a blunt instrument to fend off competition. Vlingo’s technology is good, but as a startup going up against Nuance, which has sued everyone from Yahoo to TellMe, it’s going up against a practiced plaintiff.

In a mobile world, the conversation opener is less likely to be, “How are you?” and more likely to be, “Where are you?” Since the goal of social networking technology seems to be to get us to speak less and look at screens more (all hail the mighty text ad), Nokia’s purchase of Plazes makes all the sense in the world. In fact by buying the social mapping service, the handset maker is merely continuing efforts that began with its $8.1 billion NavTeq acquisition, which should close soon.
Nokia’s efforts, along with the iPhone’s new GPS chip, are a sign that location-based services are becoming a reality after years of hype. Previously a dearth of true Internet access paired with high-priced GPS plans made LBS more of a wish than reality, but the iPhone and unlimited pricing plans are changing that. Aside from picking up a cool LBS tool, the Plazes purchase drives home the message that Nokia is spreading its attention across multiple devices, something it signaled a serious interest in when it offered to buy TrollTech.
Plazes had only been available on the PC and Mac until earlier this year (with SMS texting tools too), when it launched an iPhone application. The crossing of the PC-to-mobile chasm may have been what triggered Nokia’s interest, as the handset maker has been busy thinking across all screens. As carriers lose their ability to control Internet access on phones and users have the true Internet available, companies who can offers people seamless applications on PCs and mobiles will thrive. Nokia is pretty close to carriers despite the grumblings over its latest handset offerings, so I look at this deal as validation for both LBS and a true-Internet experience on mobiles.

Just as any online content producer or web site owner is hungry for metrics about their web site, iPhone application developers are bound to want the same types of facts and figures surrounding the usage of their programs. New York City-based startup Pinch Media, which has received an undisclosed amount of funding from Union Square Ventures, First Round Capital and a handful of angel investors, offers iPhone SDK developers free code that gives them analytics based on unique users, active users and length of time the application is in use.
Not only has Apple has sold roughly 5.4 million iPhones to date, but it’s working hard to get the device into as many people’s hands as possible, launching it in country after country around the globe. At this point, it’s hard to gauge how large this market could become.
And with the iPhone SDK coming out in June at Apple’s Worldwide Developer Conference, we’re about to see an explosion of apps being offered by mobile developers. Indeed, as the iPhone ecosystem continues to evolve, startups that offer tools such as Pinch Analytics are going to be really valuable.

Moblyng, which was formerly known as Fliptrack, just raised $5.7 million to translate Flash content from the Web into videos or stills that can be viewed on most cell phones. As a transcoding junkie, I thought this was cool — until I realized that the company will use its translation prowess to allow you to scrape your “photo bling” from MySpace, Friendster and Facebook (only via the Moblyng Mobile slide show Facebook app) and render it fit for viewing on a WAP page on a cell phone.
This seemed silly to me. And then I realized I am old and hopelessly outdated.
As CEO Stewart Putney said, this way someone can post a video or photos and share them with everyone at the same time. This fits with my ever-present wish to upload content once and share with everyone. I just don’t see many of my recipients being so jazzed about my photos that they need to flip open their mobile to see them RIGHT NOW. But if they are, using Moblyng they can.
Putney also said that after the beta Moblyng might expand the technology beyond social sites, and possibly to devices such as televisions. That fits with another of my technological dreams — seamless content transfer across all three screens. I suppose shopping on Etsy via my mobile will just have to wait.

Today, telco gear maker Dilithium Networks launched a software product for carriers, content publishers and content delivery networks that can handle all of the transcoding necessary to take content formatted for one screen and move it to another in real time. The Dilithium Content Adapter is the first software product from the seven-year-old telecommunications gear maker. The company has focused on 3G video since its inception, and Dilithium says the product is already deployed with some operators and CDNs.
But Dilthium’s not alone in its focus on delivering faster video to mobile devices. In a few months, Limelight Networks will launch a mobile CDN product for its customers, and Dave Hatfield, an SVP of marketing sales at Limelight, says customers are testing such a product now. While it’s not a huge focus at Limelight right now, he says phones like the iPhone have changed the potential size of the market by making it easier for consumers to get mobile video — and that could spur market growth.
After the launch of of the iPhone, which opened the Internet to mobile users in ways that were previously cost prohibitive or downright impossible, mobile video may be inching closer to reality. I’m even inclined to shed my doubts about mobile video (although not mobile TV). As such, operators may have to worry about delivering everything from video ringtones to YouTube content on devices. And that could mean a new market for content delivery networks.
Delivering images and video over the Internet to a PC via a CDN is an established fact of doing business for content publishers, but adding mobile screens to the mix have a few gear and service providers seeing green. Such vendors are trying to capitalize on three opportunities in the mobile infrastructure to sell products.
First is some sort of transcoding service, through which content formatted for TVs or PCs is encoded and decoded in real time, or encoded in a variety of formats and stored for delivery to the appropriate device. The second is a sizing service that fits the content to the mobile screen on one of more than 5,000 different mobile devices out there. Finally, the third is any sort of tweak that can reduce the amount of space and time to deliver mobile video on a wireless network.
There are skeptics. Barrett Lyon, CTO of BitGravity, a P2P CDN, scoffs at the notion that any sort of specialized services need to be offered for delivering content to a mobile phone. He points out that CDNs are already delivering ringtones and other content to mobile devices. He may be right, which means Limelight may not find a huge market for its services.
However, I tend to believe that real-time transcoding and other ways of rendering content delivery across multiple devices seamlessly will propel sales of gear or software in the years ahead. Especially if mobile Interent devices take off like chip makers hope.

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Motorola Ventures today put an undisclosed amount of money into Sunnyvale, Calif.-based startup VirtualLogix, which aims to do for communications equipment and mobile devices what VMware has done for the server. I’m pretty leery of companies throwing around the v-word, but with its take on virtualization, VirtualLogix is actually creating value.
For proof, check out the plans for a sub-$100 multimedia 3G phone developed by Purple Labs using NXP chips running VirtualLogix’s software. The software allows a processor to run a rich operating system on the same chip that controls the baseband access. (In a typical smartphone — depending on the applications and radios needed — this takes two or more chips.) The end result is a high-end feature on a low-end phone using fewer chips. That’s excellent for device makers, but VirtualLogix counts among its investors TI and Intel, two companies that want to sell more chips.
VirtualLogix CEO Peter Richards explained this contrast away by saying the chip vendors just want to make customers happier. But while that may be true, what’s really behind the chip firms’ interest is VirtualLogix’s ability to take software written for single-core chips and run it on multicore chips by virtualizing the multicore hardware. Multicore chips aren’t in phones right now, but given how much we want our handheld devices to do, they will be.
The other beneficiary of virtualizing a communications device is the gear market, where VirtualLogix customers such as Alcatel-Lucent are using the software to combine multiple products, like call routing servers, call management servers, etc., into one box rather than four or five. Virtualization as offered by VMware and Xen is creating a lot of savings by allowing companies to reduce the number of servers they use in data centers, so it stands to reason that it can do the same in the telecommunications world.

Obopay, a three-year-old mobile payments startup, has scored $20 million in additional funding, CEO Carol Realini told me this afternoon. She and other Obopay executives contributed to the round by wiring their investments to the company coffers by way of their Obopay accounts on their mobile phones.
Yes, it’s a gimmick, but it’s also a very real indication of Obopay’s determination. Much like Western Union is the money transfer agent of choice in the real world, and PayPal is online, Obopay wants to be the way to send money for mobile. To do this it will have to win out over PayPal’s own mobile division, plus a myriad of startups such as KushCash and TextPayMe.com. It has the backing. Prior to the most recent round, Obopay had raised $48 million. A company spokeswoman said the $20 million round isn’t complete and that the eventual total may be higher.
Obopay is counting on the experience of people like CFO Dave Johnson, a former CFO at PayPal and Banc of America Securities, because its global money transfer plans require it to handle banking relationships in multiple countries (right now it’s only in the U.S. and India).
It had to get a whopping 41 licenses in order to become a registered money transfer agent in the U.S. The result is that Obopay allows users to store and move money on their Obopay account accessed through mobiles or the web, and also to transfer money from their bank accounts using their phone to that of another person — even if that person doesn’t have Obopay.
The ability to transfer money regardless of a person’s carrier or bank is a compelling proposition. Realini hopes allowing non-Obopay members to receive money will help the company grow over the long term. The money transfer play here is much broader than the “split the check” kinds of social payments offered by KushCash and TextMyBill. The amount of money transfered between countries is in the billions, so if Obopay can expand quickly on an international scale, it could very well achieve what it’s trying to accomplish.

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One of the most important calls I make during the week is the one to my mother, followed by another one to my baby brother. These are international long distance calls, and for the first 15 years of my American life, those calls went over AT&T’s wired or wirel