Thursday, September 18, 2008
Interview with Derrick Oien, Intercasting
Story by Benjamin F. Kuo
We seem to receive lots of pitches from companies looking to attack the mobile market with their mobile software applications, but few who have deployed on-deck with carriers. San Diego-based Intercasting (www.intercasting.com) is one of the companies which seems to have gotten some traction, and has deployed with Boost, Virgin, Sprint, and is in the process of deploying with Verizon and ATT. We spoke with Derrick Oien, president and co-founder of the firm, about the company's mobile social networking applications, as well as about his view on penetrating the mobile carriers. Intercasting is backed by $17.5M in funding from Venrock, Avalon, and Masthead.
What exactly are your mobile social networking applications?
Derrick Oien: We have a platform we develop, called ANTHEM. ANTHEM is referred to, depending on what segment you're looking at, as either a community gateway or social networking gateway. It's a client-server solution. The client application is an application that an end user downloads, or is already loaded on the phone as a pre-load. The client then presents the consumer with the opportunity to have a dashboard view of social networking sites. They can look at friend requests, comment, send messages, and things like that. Or, they can experience the full site, and we'll optimize the site in the client for a specific handset. A good example of what we do is, you can open a WAP browser on your phone and go to m.myspace.com, which is perfectly fine. But, with Intercasting and our ANTHEM version of MySpace, it's a client integrated into the device. You can do additional things like access the camera, upload photos directly to MySpace, go to your address book on the phone and send direct message to friends. It's an integrated client. On the server side, we have a gateway to integrate with social networking partners. Whereas lots of companies allow you to upload content, we've got deep integration to those sites, including bidirectional publishing of content. Not only can you send photos to MySpace, you can bring content down to your handset. Our goal is to make it an immersive experience on the handset.
It looks like you've got a number of carriers distributing your product, how are your applications distributed?
Derrick Oien: The primary market is the operator. We've got deals with Boost, Virgin, Sprint, and we just announced with Verizon, AT&T, T-Mobile UK, and CSL in Asia. The second customer is the social networking sites. At social networking sites we're really focused on one-time integration, and distribution across hundreds of handsets. Historically, operators have worked with companies like us to bring services to market--they've worked with messaging firms, SMS, gateways for instant messaging, and companies like us for community gateways. So we sell into the carriers. It's along sales cycle, but the beauty is that when you're done, you've got client software which a consumer can use, specialized for their device, and able to do cools things, things that you couldn't do if you didn't work directly with the carrier.
So do these show up as your brand or as an OEM deal with the carriers?
Derrick Oien: We are used as a white label. The different carriers deploy us under different names. With Sprint it's Social Zone. with Verizon it's SocialLife. With AT&T it's My Community. So it's a white label offering. We also have Rabble.com, which we actually run ourselves. Historically, it was something that started to develop before our launch with operators back in 2005, and it now serves as a laboratory for development of our product. We use it to decide which features to roll out, and to experiment on, rather than experimenting at our partners. It's somewhere we can introduce features and work out the bugs.
How difficult has it been to get your application on-deck--we hear this is often very difficult?
Derrick Oien: In general, the lead time is somewhere between six months and a year and a half.
And it also looks like there's some pricing difference between carriers--is this something you drive, or do they set pricing?
Derrick Oien: That's driven by the operator. Currently, Verizon is $1.49, AT&T is $2.99, the Sprint offering is ad-supported on the WAP interface with an upsell to a premium client at $2.99 a month. Some carriers are launching it as part of a data plan, for example for $30 you get unlimited Internet, and you get the application for free. It all depends on the carrier and their target market.
We see a lot of off-deck, mobile social networking firms. What's your opinion on how well that works, and how much competition are they?
Derrick Oien: I think the first thing, and the most important, is that we don't see off-deck as competitors. We're trying to work with operators, and that's a different strategy. We're really focused on enterprise sales and carrier grade products. We support 700 different handsets across our platform, whereas some folks are just building a Java application which is supported by an expensive, N95, $700 smart phone--which no one has. The other thing, is that these sites have uploading functionality that you can't really experience without the rich client experience. In terms of on-deck, there are folks like Newbay, Verisign has a product called Zoomerang--those are really our direct competitors. Off deck is really difficult, because the consumer discoverability is the biggest issue in all of mobile. We work with operators, and load onto phones, and we still have a problem with discoverability. With off deck, there's 100 times the difficulty.
How long has your application be available?
Derrick Oien: We launched Rabble in June of 2005, and we launched the first version of ANTHEM in September of 2007. So it's been a year. We just literally launched on Verizon and AT&T.
You mention the problem of discoverability. Are these applications, and social networking on mobile phone happening yet? It seems like there's a long way to go until this is widely adopted.
Derrick Oien: Absolutely. I'd characterize mobile social networking as nascent. While Gartner, Forrester, and Jupiter--pick your choice--says that there are millions of users who want the mobile web, especially when they include China and India in their forecasts. QQ is hitting it out of the park in China. But, in Western Europe and the U.S. it's relatively small. If you look at MySpace, they have 2 million uniques a day on their WAP site, which is impressive--but not Internet scale. Because the carriers have this as a premium--they charge for it--overall, the users number in the hundreds of thousands across all the different services, ours being just one of those. So we're still at the front end of that. The key issue is discoverability, but it's also distribution, and the ability to support any handset. Historically, for us and our partners, you would merchandise the service out to customers, and you had the issue of how do they find it. Do you want to be pushing the service out where you can get this on Sprint, but only on 10 handsets? You want it to be on any carrier, on 200 handsets. We've now gotten to that point, and have the distribution and footprint. Now, it's really about driving awareness, on both the carrier and communities. The big secret is on preload on a device. We have one preload which accounts for almost half the sales. We have a number of preloads going to market, where sales and deployment takes 12-18 months. We have a number of handsets going live now, and the big focus of the company is expanding our relationships with OEMs and manufacturers, and driving awareness and discovery.
So where you are you going next?
Where we're headed is we're doing a good job of wrapping distribution in the U.S. and have carriers in Canada with Bell Mobility, and some more deals there. We have deals in Latin America, and Europe. From a distribution footprint perspective, we'll be doing more deals like that, and adding more sites on our platform. We're negotiating with sites we're currently missing, and we'll be launching those shortly.
We also think we're the best of breed on the product side, and trying to raise the bar on that, and do some other cool stuff. For example, things that will make Java look a lot like Flash on a phone. We're also rolling out services around IM and email, as well. Tomorrow, where I can get a dashboard of social networking, I can get email and look at instant messages as well. We're adding other features that drive the idea of the making an overall communications hub device.