Cutting Ties With Microsoft

Wireless Knowledge rebuys shares; to become Qualcomm subsidiary.

In an effort to evolve its multiplatform enterprise server strategy, wireless middleware manufacturer Wireless Knowledge Inc. last week severed its relationship with Microsoft Corp., buying back all shares held by the software company.

Wireless Knowledge will become a subsidiary of Qualcomm Corp., which co-founded Wireless Knowledge with Microsoft in 1998.

"I dont think the cooperation [with Microsoft] worked to the degree that we all had hoped it would," said Eric Schultz, CEO of Wireless Knowledge, in San Diego.

Wireless Knowledge initially struggled in the market as it tried to sell a less-than-stellar wireless platform to carriers. Early last year, the company shifted its focus to corporate enterprises and bolstered the technology.

But as Wireless Knowledge was gaining a foothold with its Workstyle Server platform, Microsoft introduced its Airstream initiative in the form of a product that competed directly with Wireless Knowledges software.

Microsoft launched MIS (Mobile Information 2001 Server) in the spring. The product, based largely on technology from Wireless Knowledge, offers access to various Microsoft applications—and only Microsoft applications—using Wireless Application Protocol. Wireless Knowledge received royalties for every sale of MIS.

Meanwhile, Workstyle Server was supporting platforms beyond those of Microsoft, including wireless access to Lotus Development Corp.s Notes and Domino. By the time MIS was launched in Version 1.0, Workstyle Server was on Version 3.5.

When MIS was launched, Microsoft officials indicated that Wireless Knowledge existed mainly to support MIS and that current Workstyle Server customers would migrate to MIS when future versions of MIS became available. Wireless Knowledge disagreed, and the rift was born.

"Microsoft has a multibillion-dollar business around Windows and BackOffice," said Jeff Ross, director of corporate development at Wireless Knowledge. "It only makes sense that their goals are focused on those core products."

Bob Muglia, group vice president at Microsoft, in Redmond, Wash., said both companies "have decided it is best to pursue our respective goals using independent technologies."

Wireless Knowledge said it expects independence to instill confidence in customers that want to see support for platforms beyond Microsofts.

Sprint Corp. and Verizon Communications Inc. should be pleased that Wireless Knowledge will be a Qualcomm subsidiary. Both have agreements with Wireless Knowledge to sell Workstyle Server to corporate customers. Qualcomm owns the patents for all the wireless telecommunications standards that are based on Code Division Multiple Access, a technology that Sprint and Verizon plan to use in their path to third-generation wireless networks. Qualcomm, of San Diego, also owns Binary Runtime Environment for Wireless, or BREW, a wireless development platform for handheld devices that Wireless Knowledge intends to support in its products.