Steve Follmer consulted in Silicon Valley for many years, where he co-founded live365.com. He is currently between startups and analyzing opportunities in the mobile space. Steve holds a BSE degree from Princeton University.

MoMo Taipei 17 kicked off with a security presentation from one of our
sponsors, Thales Group. With operations in 50 countries, 68,000
employees, and 17 billion dollars in annual revenue, Thales is a world
leader in Mission-critical information systems for the Aerospace,
Defence and Security markets. Dr. Welland W. N. Chu, Regional Business
Manager for North East Asia for their 400 person Information Systems
Security group, delivered a convincing explanation of the importance of
this market.

Thales implemented the contactless cards and tokens for our MRT and the
tickets for our high speed rail, along with the readers on Taipei’s
buses and parking lots. Thales handles the payments securely, and
disburses the money. Thales technologies are used in payment terminals,
bank communication networks and the secure manufacturing of bank and
credit cards. In the financial sector, more than half the world’s banks
and most major stock exchanges rely on Thales technologies. With nobel
laureates on their research team, they also discovered giant mageneto
resistance, without which your hard disks and laptops would weigh 25 kg.

In vital markets such as security, there is of course competition. One
Thales advantage lies in their strong existing connections to
government, defence, and intelligence communities worldwide. If any of
our readers is unsure of the need for security, in response to a
question Dr. Chu noted that in testing customer sites they can
compromise 95% of their networks.

Thales system also features a unique ability to seamlessly traverse or
roam sundry fixed and mobile networks and protocols, while maintaining
ironclad security. A turnkey approach to security not only minimizes
training costs, it also keeps the network safe. Their product operates
on Windows mobile PDAs (about 12% of smartphones). Momo readers will
also want to know that Thales Transport’s new generation ticketing
system is ready to accept transactions by NFC.

Resources:

Thales
Smartphone

CyWee is a 1 year old startup, spun off from years of research at Taiwan
government-industry think-tank ITRI, with funding from ITRI and SBCVC. Their
CyWee Z is now for sale: a PC input device like a Nintendo Wii on
steroids. Check out their demo:

The Z is the only one of its kind with a
3-axis accelerometer and a dual-axis gyro. And rather than a bunch of cheap plastic
attachments, the controller itself bends and twists into 4 different
shapes: sports, gun, car wheel, and airplane yoke. Rather than being
limited to low res Wii graphics, the Z can drive any game on your PC,
since the Z maps useful keyboard strokes into physical actions on the controller.
It currently comes with support for 10 offline and 2 online games.

By some estimates “The total market value for PC gaming hardware
in 2008 was just over $20 billion, and that will grow to over $34
billion by 2012.” And as a 3D mouse, the Z is also part of the PC input device
market. CyWee plans expansion to the international market, and
has numerous other products in their R&D pipeline.

The Z is sold in Taiwan for NT$3990 bundled with 3 game titles, while supplies last.
Shopping at PC Home

Resources:

PC Home
Worldwide PC Gaming

Steve Follmer consulted in Silicon Valley for many years, where he co-founded live365.com. He is currently between startups and analyzing opportunities in the mobile space. Steve holds a BSE degree from Princeton University.

GPSStar presented at Mobile Monday 14, and we were invited to a follow
up interview with their CEO, Mr. Ben Inatsu. GPSStar has licensed the
Navitime technology from Japan for deployment in the greater China
region. Their primary product was launched via ChungHwa Telecom (CHT)
over a year ago: it turns your cell phone into an interactive map,
providing directions, integrated with public transit schedules. $3 a
month (99 NT) gives you unlimited use, including data. This service runs
on 18 AGPS handsets; a lite version costs half that (and for technical
reasons does not include real-time navigation). This pricing is about
half that of Japan, where Navitime has 10mm users each month.

GPSStar has about 2 dozen employees in Taiwan, primarily engineers. They
seems an engineering driven organization, though this comes from an
integrity in which they are very concerned with providing accurate
directions and indeed restaurant phone numbers. The accuracy of all the
data they deliver reflects on both GPSStar and the carrier, and they
take this responsibility seriously. They are currently establishing a
China headquarters located in Beijing, the center for both carriers and
manufacturers.

While easy to understand in terms of their handset navigation products,
we must not overlook the fact that they have in fact built a LBS
services platform. Their software will soon cover 200 handsets, nearly
all the models sold in Taiwan. Beyond that, they are doubtless engaged
in verifying maps to encompass all of greater China.

In Japan’s mobile ecosystem, the carriers dictate specs to the handset
manufacturers. Thus they have demanded and received far greater AGPS
penetration, rapidly approaching 100%. Carriers worldwide face declining
revenue from voice, as it is replaced by IP phones. They therefore look
to value added services, and in Japan their value-add income now exceeds
their voice income.

China’s cellular ecosystem is most analagous to Japan, though it is
fairly unique in that manufacturers are launching services there. Nokia
for example is very inventive and keen to establish some services
revenue, but this is something the carriers have prevented in most
markets e.g. USA. Mr. Enatsu noted that we have not seen the end of
these ecosystem turf wars.

The Taiwan market and ecosystem is of course different still. It is
smaller than Japan and China, and the government does not take as strong
a hand in industry. As such, the carriers cannot dictate features to the
handset manufacturers here. And because it is small, handset
manufacturers have not floated services here, though Taiwan still
remains useful as a testbed for products intended for greater China.

One can certainly imagine a variety of additional LBS products, and
unique marketing approaches for GPSStar. But I cannot fault their
attention to the nuts-and-bolts of covering more handsets and more
countries. Furthermore, I expect they will eventually market the LBS
platform, for themselves or new partners to offer novel LBS products.

The recent controversial study in Germany which monitored peoples daily
movements through their cell phones revealed that people generally
frequent the same locations over and over again. This suggests that LBS
might be more useful to specific classes of users, and indeed GPSStar
may next year offer products targeted to tourists and expats.

GPSStar does not face the market risk or technology risk of most
startups. This is not to diminish their work in covering so many
handsets and such a large geography. Indeed this acts as a sustainable
competitive advantage. Their main risks lie in the transition to
mainland culture, business partners, and government regulation. Indeed
the need for local knowledge further discourages competition.

GPSStar added 3000 Taiwan subscribers during the week of our
interview. Their work is bearing fruit. Their business model and risk
profile are solid. Their platform runs on nearly every cell phone in the
country, delivered through their partnership with CHT. And their goal
is for their LBS platform to become standard on every handset in Greater China.
We wish them every success in their expansion to the mainland.

Mobile Coupons and Price Comparison -By Steve Follmer

Steve Follmer consulted in Silicon Valley for many years, where he co-founded live365.com. He is currently between startups and analyzing opportunities in the mobile space. Steve holds a BSE degree from Princeton University.

Vpon.com

Victor Wu, founder and CEO, demonstrated Vpon, a coupon browser service which is up and running in Taiwan. Vpon was born from an award winning entrepreneurial project he created while completing his MBA in London.

Users install Vpon’s coupon browser, which runs on java and up to 80% of the installed base of phones. Technologically, Vpon has taken steps to economize on bandwidth, and depending on your data plan it costs less than $1 to receive 30 coupons. They also offer a form of location based service to filter coupons for your specific neighborhoods. Mr. Wu values the user relationship and has avoided pushing too much data at the consumer, even on an opt-in basis. There are plans for internet browser based management of the coupons as well.

Vpon has also been responsive to the needs of their advertisers, allowing them to target their coupons to specific demographics, and collecting post-sale customer satisfaction surveys via their mobile app.

In less than a year Vpon has grown to 10 employees, deployed their application, and inked deals with Starbucks, Pizza Hut, and Mister Donut. They have acheived break-even; an infusion of working capital would fuel expansion to additional countries.

Smart Buyer

Smart Buyer has launched Mprice, a cell phone based price comparison service. They presented a very insightful chart comparing web-based shopping/buying with brick & mortar (B&M) shopping. In the USA 93% of consumer purchase remain B&M, a number which approaches 97% in Taiwan. mPrice forges a unique solution that offers the best of both worlds: the convenience of network based price checking, with the convenience of B&M shopping.

The business model contemplates charging the consumer 15 cents per use. They also gather useful buying data which is sold to the channel. They are signing deals with the top chains, thus offering a countrywide solution. And they have initially singled out the low hanging fruit of 3C products.

Smart Buyer has vision and has made some good decisions. It goes without saying that their spreadsheet is driven by their installed base and daily use. If only an affilliate marketing program were offered by the local chains or could be negotiated, user fees could be eliminated.
Or if any user fees could be made more invisible through some package promotion with their carrier partners like CHT.
Smart Buyer is partnering with CHT and 7-11, and various media outlets.
These firms are on board with their vision and will prove essential in
increasing the installed base.

Commentary

I always stop to ask: list every step needed to get my parents using this product, every mouse click, every keystroke, every credit card authorization, every download, every install. Tonight’s presenters can benefit from carrier distribution deals that pre-install their application and bundle a data plan. Failing that I would set up kiosks with technical staff to install the app along with a pile of v-coupons or free trial incentives.

There has to be a viral angle here too. Let people share coupons with their friends to spread both the app and the coupons virally. Where one users tells their friends that the app is safe and useful, and even helps them install it. With an incentive e.g. “10% off on dinner. If you and your friend BOTH present a Vpon 15% off”. The merchants should also step up to the plate and help seed.

To get these and other products to turnkey simplicity, where not only our parents but our grandparents use them daily, it takes an ecosystem. Japan remains an intriguing example, where indeed parents and grandparents use many advance mobile apps.As with wasabi, Japanese ecosystems don’t always take root in the West. But I have a feeling Taiwan could forge a solution that bridges East and West.

You can see the photos from the 15th MobileMonday Taipei event here.