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Startups see opportunity in wireless search

If the Internet is ever going to be a truly global resource, then we should be able to search for whatever we want, whenever we want, from wherever we want.
/ Source: Forbes

If the Internet is ever going to be a truly global resource, then we should be able to search for whatever we want, whenever we want, from wherever we want.

Sure, you can pull up a Google or Yahoo! search on a BlackBerry or some other wireless PDA, but not everyone carries one. Most people now carry some kind of cell phone, however, and many of them are ready for Internet access and text messaging.

So a great deal of attention is now being paid to search technologies for mobile phones. Yahoo! is pushing search features to phones, including the ability to search for images via a Web-like interface. Google recently launched a version of its local search service that lets users send queries via phone. Send a message like "pizza 10028" to Google's text messaging address, and you get responses containing the names, addresses and phone numbers of pizza restaurants in upper Manhattan.

Tony Philipp is unimpressed with Google's text message search and thinks he can do it better. He's co-founder and chief executive of UpSnap, a San Francisco-based startup that has built a search engine from the ground up with so-called short message service (SMS) searches in mind.

For starters, UpSnap isn't just limited to ZIP codes. If you are waiting at an airport for a ride, you can send a text message to UpSnap with "taxi" and the three-letter code for your airport, and you'll get a response in less than a minute. UpSnap also lets users search from its Web site and then send the results to a phone so they will have access to the information later. As with the traditional Web search business, advertisers will pay for prominent placement within those results, Philipp says.

On Nov. 4, UpSnap announced a deal with LookSmart, the Web site that specializes in paid search results. Under the deal, LookSmart's customers -- advertisers that pay to have their information included in search results -- will get their information included in UpSnap's results. Terms for the deal with LookSmart, which had 2003 sales of $156 million, were not disclosed.

Along with the search results, UpSnap can also deliver an advertisement or coupon, or an offer for the merchant to call users if they want to be called right away. UpSnap charges advertisers on a "per action" basis that depends on what the wireless user actually does.

Philipp sees it as one way for consumers to get around the fees the telephone companies charge for dialing 411. "You can either shell out $1.50 for a voice call or send a free message," he says.

Well, not entirely free. Short message services are one of the many things that wireless carriers want to push to boost usage of their wireless data networks -- and their revenue. Users pay nothing for the search itself, but a small charge for the connection. Some carriers bill by the message, which can be as low as 5 or 10 cents to send a message, 2 cents to receive one. Most offer all-you-can-eat flat rates, such as Verizon Wireless, which offers a plan that includes 1,000 text messages for $10 a month.

UpSnap is just one of many companies seeking to build a business around short message service search. Other names cropping up in the nascent space include Synfonic, a Berkeley, Calif.-based startup, and, a comparison-shopping site with a feature that lets consumers send the part number of a product and get prices from online vendors sent to their phone, giving them a leg up while shopping in retail stores.

Then there's searching based on a mobile phone's location. Many phones, particularly those using the technology behind networks such as Sprint PCS and Verizon Wireless, a joint venture of Verizon Communications and Vodafone, are increasingly likely to support the Global Positioning System and so can communicate their location precisely.

Bell Canada's Bell Mobility offers a popular service called MapMe that allows its customers to search for businesses near their location. Need a Chinese restaurant within four blocks? Call up a map on the phone's screen and see your options highlighted. Pointing the cursor to choices on the map turns up directions (from the caller's current location), a phone number and an address.

The service was developed by WaveMarket, an Emeryville, Calif.-based company backed by the venture capital arms of Nokia, Intel and British Telecom, among others. WaveMarket CEO Tasso Roumeliotis says MapMe is one of the most popular software downloads for Bell Mobility customers. "The idea of searching by SMS to me is horrific," he says.

For its next trick, WaveMarket is introducing a service called Crunkie that will combine social networking, blogging and tracking friends on wireless phones. Think Friendster meets Blogger meets AOL buddy lists meets mapping--all baked into mobile phones--and you get the idea. Roumeliotis says a major North American wireless carrier is expected to announce a deal to deploy Crunkie on its network before the end of November.

These so-called location-based services have been hyped before, but the ideas behind them were pretty tame. One classically bad idea was essentially wireless spam: Walk by a store and get coupon for a special e-mailed to your phone. Bad enough, but the service providers couldn't even figure out how to charge for it.

Now they can. "Now we see micro-billing on a per-incident [basis] for a relatively low cost," says Lance Wilson, director of wireless research at ABI Research, based in Oyster Bay, N.Y. "And the amounts charged for these services are small enough that people can make an instant decision whether they want to use them or not."

It may still be hard envisioning how much money these services can generate, but there are precedents for seemingly innocuous ideas turning into cash cows, Wilson says. "If I had told you a few years back that ring tones would be a $1 billion business by now, you'd have thought I was certifiable."