Fifteen years ago, an unknown investment banking analyst in New York published a report on the Internet. At the time, most people were aware of a new Internet phenomenon, but big business had not adopted it and Wall Street had no idea what to make of it. Mary Meeker’s well-thought-out 400-page tome accurately predicted that the Internet would transform business the way the personal computer had. She became a rock star among the geeky analyst community, and her firm, Morgan Stanley, has reaped massive rewards from that fearless set of predictions.
It would therefore be a good idea to pay attention to the subject of her latest report, which she herself maintains will have a bigger impact than the desktop Internet. In December she released The Mobile Internet Report (ms.com/techresearch), which focuses on the convergence of five trends: fast wireless data, social networking, video, voice over IP (data) and truly impressive mobile devices. Put another way, the mobile Internet is Facebook meets Skype meets YouTube on a super slick iPhone, all without any connection delays.
Sure, we all have mobile devices and understand how they have changed our lives, but the mobile Internet has not come close to hitting its full potential. The powerful smart phones (BlackBerry, iPhone and Google’s new Nexus One) make up only 18 per cent of the global cellphones in use today. As with the Internet boom in the late ’90s, the mobile Internet boom (2010 to 2013) will see growth all along the value chain. From the designers of the latest chips to the manufacturers of displays to the developers of the applications and entertainment that we consume, many companies will benefit from the explosion Meeker is predicting.
If she is right, many B.C. technology businesses must be downright giddy about the next few years. We have a long history in wireless data, going back to MDI and Glenayre, and a plethora of wireless technology companies today, led by Sierra Wireless Inc. We also have a rising tide of entrepreneurs in Internet media, especially social networking. Combine that with the digital entertainment sector (dominated by video games), and we have much of the mobile Internet value chain covered. Recognizing the impending mobile revolution predicted by Meeker, all these formerly disparate wings of the local wireless and digital media industry recently joined forces in a single association called DigiBC.
We already have local companies such as Invoke Media and its social media application HootSuite making hay in the mobile Internet space. HootSuite’s iPhone application is being downloaded by the truckload, allowing Twitter and Facebook users to update their thoughts and musings from any location. Burnaby’s Canpages Inc. has designed very useful and cool apps for BlackBerry and iPhone that allow you to simply ask for a business; they search and display the results. Gym Technik Ltd. was just recognized by CrackBerry.com, a popular BlackBerry application site, as having the best health and fitness application for the BlackBerry with its workout partner and fitness tracking offering. Mobify is building a big business converting existing websites to mobile sites accessible on a variety of mobile devices. Similarly, Nitobi Software Inc. has an offering called PhoneGap that takes existing web applications and converts them into fully functioning mobile phone applications. Both of these companies are at the cutting edge of mobile Internet development.
In five years, Meeker believes, the Internet will mean something very different than what it does today. Accessing Google through a browser on your computer will give way to connected applications on your mobile device as the most popular way to access information and entertainment. As she says, “Some companies can benefit from technology changes by being in the right place at the right time, while others will wonder what just happened.” I believe many B.C. technology companies are ready and in the right place.
Brent Holliday heads the technology practice for Capital West Partners, a Vancouver-based investment bank.