Sunday, April 14, 2024

Don’t Bet on Wireless as a New Business Model

As I previously discussed, wireless communication continues to have a tremendous influence on our daily lives. But does your business have (or need) a strategy to take advantage of this growing technology?

In this article, I will discuss not only the convergence of technologies to create new services, but I will also explain why the concept of wireless should be treated as an infrastructure to support a business model and not as a business model itself.

Useful Convergence

From the perspective of a consumer, wireless devices are effective only when useful convergence occurs. Convergence is defined as the point at which multiple technologies are brought together to form one product or service. Useful products can be either a previous service which is enhanced by using a wireless connection or a wholly new service that is created. But these new services need to fill a consumer need, not just a want.

Why does it have to be a “need”? In order to become a commercially viable business solution for which people will pay, it has to be a service that goes beyond the “wow” factor. Wireless phones are the best example of an old service that becomes even more valuable when it became available (and affordable) to the mass public.

To compare wireless to the Internet, look at what eBay created. They took a service that existed previously (yard sales, classifieds) and took away the physical barrier of distance. They found a way to fill the need to sell your items to people who are looking for them.

How did eBay succeed on the Internet? It offered useful convergence of technologies to create a service that fills a consumer need. As such, the Internet was used as the infrastructure to build and support a new service. You must think about wireless in the same way.

Wireless as Infrastructure

Is it cool to surf the Internet from a wireless phone or PDA? Yeah. But is it a useful convergence of technologies that fills a need of the mass consumer market? Not yet, and most likely not for many years (if ever).

In order for your business to leverage wireless technologies, it has to fill a need that will expand to a larger part of the consumer market beyond the 15% of early adopters who basically try any type of new technology. Many of today’s “wireless” ideas will not survive, just as many of the Internet-based ideas did not (look at Kozmo, Eve, Pets — just to name a few!).

The mobile phone has revolutionized the way we communicate, global positioning technology has given us navigation systems and satellites now give us digital television and radio service. These are the current wireless technologies that fill a need. What’s next?

A History Lesson

Many of the cellular phone companies that have popped up within the past 15 years were not part of the traditional phone companies. But today, consolidation has occurred and the “old” phone companies are major players in the wireless phone industry.

Why did this happen? Because the older phone companies let the newer companies test the marketing waters and bring the technology to a point where it was commercially viable for the mass market of consumers. At that point, they were able to use their resources (current customers, cash, technologies) to get into that space.

What’s the lesson? Think of wireless as an infrastructure to help build your business (like computers and capital) so that you don’t create a business strictly on wireless — that is just too difficult to do successfully.

Is there a Bluetooth in Your Smile?

Let’s look at a current wireless technology that is gaining ground. The Bluetooth technology and standards have been created by a group of leading industry players. Basically, this technology allows for any electronic device (like a cell phone, PDA or computer) to interact with another device (like a vending machine, toll booth or printer).

Common types of interaction may be sending a file to be printed or buying an item from a vending machine. Think of this technology as replacing the cables that connect electronic devices. An example that comes to mind is how the portable phones in your home have replaced those 10-foot coil cords that we used to connect the handset to the phone base. I surely don’t miss those cords!

Again, this is another example of a wireless technology that will be used to support a company’s business model, but will not be the company’s entire business model. I will continue to cover the Bluetooth technology and others in future articles.

Concept Review

The wireless communication revolution will continue to provide us with enhanced communications. But like the Internet, it has to be built into a company’s business plan as part of the infrastructure for a solid business model, not a model by itself. Continue to evaluate the ways that wireless communications can benefit your employees and customers, but only use wireless technologies when you have useful convergence.

Ishtot – Describing Technology in Terms of Business Paul Carney has helped build and sell two online businesses and now uses his technical background and business knowledge to help business leaders understand today’s technical concepts in the context of business. For more information, visit www.ishtot.com

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