In the traditional software sector Ireland is happy to play host to multinationals but when it comes to the mobile we are shooting for home-grown world leaders.
With €180m in turnover in 2007 and 70 indigenous companies, the mobile telecoms sector in Ireland is healthy to say the least but more than that, a certain few are beginning to emerge as global leaders in the area.
This change, says David Moran, CEO of University College Dublin spin-out company ChangingWorlds (pictured), is due to scale being judged as a measure of success, with the IDA and Enterprise Ireland creating programmes that will nurture the global aspirations of these companies.
“At the prestigious CEDIA (Custom Electronic Design & Installation Association) conference in San Francisco last November, Irish firm NewBay was on the judging panel alongside Virgin Mobile so Irish companies are beginning to be perceived as thought leaders in the space,” says Ray Walsh, senior development advisor with Enterprise Ireland.
“Rather than just attending these events, these are people other companies want to hear from and that is crucial for the likes of NewBay, ChangingWorlds and all those other Irish companies in the mobile space.”
Added to this, 30 of Ireland’s 70 mobile technology companies including ChangingWorlds and Anam are heading to the biggest mobile event of the year: the Mobile World Congress (MWC) 2008, running in Barcelona next month. With one company presenting a paper and speaking at one of the sessions, it is another indication of leadership in this area says Declan Collins, senior development advisor with Enterprise Ireland.
“If you go back to the days of the development of SMS and Aldiscon: that was a good marker as to the beginning of the whole mobile sector for us in Ireland,” remembers Collins.
Aldiscon began a globally-used text service for mobile operators and went on to spawn several successful spin-outs, including Anam, Aepona and Acuris Networks.
Today we are looking at a more evolved and multi-tiered sector where the established companies are sharing space with firms run by people who grew up with the mobile and are making it their own.
“We have a very strong cluster of companies providing a broad range of services, some of them very well established as true global players and another second tier of companies coming along that are focusing on new areas like social networking and mobile web search,” explains Collins.
One such new company is Mobanode, started by Shane McAllister, which focuses on mobile marketing and location-based services, delivering targeted, location-aware, media-rich content to mobile handsets using technologies like Bluetooth and WiFi.
“In my particular sphere the mobile is the new medium that a lot of advertisers are looking at: they have exhausted the normal possibilities of other media like TV and radio.
“The mobile phone is small but in the bigger picture it is far from it because there isn’t really another medium that is as personally engaging with such a wide reach and relevance as a mobile phone,” says McAllister.
While it is easy to see how the ecosystem for older companies has emerged, it can be hard to understand why Ireland continues to punch above its weight with all the new companies that have come on the scene in the past few years.
McAllister thinks there are a few reason for this, not least being the demand. “There are currently more mobile phone users in the world today than there are television sets and computers combined.
“Right now the mobile phone subscriber rate is at over 1000 per minute, higher than the global birth rate.”
He explains that people who are now entering the mobile space have grown up with the mobile and are very familiar with it. Developing technology in this area is almost second nature to them.
Coupled with this, many software tools are becoming open source, or free of licensing fees, making it affordable for young companies to work on new technologies without going into debt.
“You no longer have these high cash barriers to entry. If you have a laptop, a phone and internet access and a good idea, you’re in business.
“I think starting up any type of tech company including mobile tech, although possibly far riskier in the long run, is easier to do than say a coffee shop or restaurant which require massive upfront outlay,” he says.
However, this situation could be said to exist in other European countries but there are several factors that make Ireland unique, says ChangingWorlds’ Moran.
ChangingWorlds is a true global player, providing services such as personalised search to over 50 clients worldwide, including Vodafone and O2.
“When we started the one key thing we had was the existing talent pool here in Ireland, in terms of people with a good technology background related to the mobile network operators who we believed would be our target customers.
“What has happened in the past 20 years is that there is more of a spirit of entrepreneurship among graduates. They will take an idea and go for it and try it,” adds Moran.
This spirit of entrepreneurship is modelled closely on the Silicon Valley idea, says Shane McAllister of Mobanode, “Mobile companies get a lot of support not only through Enterprise Ireland but also through small grassroots events.
“In the past, people would play their cards close to their chest but I think that has changed over the last couple of years. There is a sense of camaraderie among entrepreneurs in this sector and people are more open to giving everyone else a hand up.”
Jote Bassi, VP global sales and marketing for Anam, one of the 30 Irish companies that will be exhibiting at the MWC in Barcelona next month, thinks the strength of the mobile software and services sector lies in its effectively replacing the traditional software sector as the phone becomes the main computing device.
“Your phone is going to become your PC or your laptop. I can foresee a time when we won’t call it a mobile phone anymore, it will be a pocket computer.”
In fact, one of Anam’s services, SMS money transfer, is an example of the myriad opportunities that exist in the mobile space.
“Providing subscribers with new services like the ability to transfer money via SMS means adding value to the mobile handset without changing the customer’s behaviour as a text user.
“We believe that SMS is something set to grow hugely in the next five years. Right now there are so many migrant workers who send money back and forth and who would benefit from this,” Bassi adds.
While Moran of ChangingWorlds thinks there is certainly a place in the history books for Ireland when they write of mobile technology, he also believes there are significant challenges to meet if we want to foster giants.
“If you look at Silicon Valley, it has always been a place that people are attracted to go work. Historically Ireland has had a lot of benefits in this area but to maintain our talent pool we have to be on our toes, it could very easily dissipate and pop up in another part of Europe.
“When people think of Silicon Valley they think of start-ups making it big and that means scaling. The ability for Irish companies to scale is a significant challenge right now.
“We have certain successes but we wouldn’t want to go down in history as the country that came up with great ideas, brought companies to €5m and then those companies all got acquired or all went away,” says Moran with vigour.
Blue in the face of success
“Bluetooth is an overlooked technology,” explains Shane McAllister, CEO of Mobanode, a young mobile technology company with dreams of bringing free, media-rich content such as video to the mobile user, which is supported by advertising.
“As far as Bluetooth goes, people are used to using their headsets with their phone and that’s about it but it is a very powerful networking technology. With the increased memory and capability of mobile phones you can now send off lots of files like photos, movie clips etc.”
An example of how useful this technology can be to the average punter is at an event such as a football match.
Mobanode can set up a Bluetooth network within the radius of the stadium with services like highlights of previous matches in the form of short video clips, and for free.
“Look at the traditional TV model: we’re used to receiving content for free and having that content backed by ads that you have to watch.
“If the content is of relevance you will sit through those ads. That’s how I will monetize my company. The best thing is that the customer won’t incur charges because it’s a peer-to-peer network,” enthuses McAllister.
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