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Opera Software is celebrating a pair of wins after signing on two European carrier partners to help promote its mobile browsers. News of the deals drove shares of the companys stock up by 20 percent to an all-time high on its native Norwegian exchange.
The more significant of the two partnerships announced by Opera was established in Germany with T-Mobile, which said it would begin installing the companys Mini browser for feature phones as the default browser on roughly 20 of its midtier devices, including handsets made by Motorola, Nokia and Sony Ericsson.
T-Mobile, which has its U.S. headquarters in Bellevue, Wash., is already using Opera Mobile, the companys browser for smart phones, in some of its high-end devices, some 400,000 of which it has shipped to users.
Operas second deal was with Debitel, another wireless provider, based in Stuttgart, Germany, which counts some 10 million subscribers across Europe.
Under that two-year pact, the company will begin offering Operas mobile browsers on all of its handsets, as well as promoting the companys Web application development platform to business customers.
These new partnerships are in addition to Operas longstanding deal with France Telecom Orange, and its list of relationships with device makers including Kyocera, Motorola and Nokia.
While the deals may not resonate too loudly outside of Europe, company officials pointed to the partnerships as evidence that it is having success with its plans to battle Microsoft and others for control of the mobile browser space.
Experts have said that in order to attract more users, Opera must first win over carriers, specifically in the United States where such firms carry more weight with customers than device manufacturers do.
In fact, Opera officials said the company has deals in the works with top-tier carriers in both the United States and Europe that will be announced before the end of 2006. The German deals are merely the first dominos to fall in the companys growth strategy, said Kai Leppanen, vice president of sales at Opera, based in Oslo, Norway.
“Mobile browsing is really taking off in Japan, its coming along nicely in Europe, and we have every reason to believe that we can grow our presence in the United States as well,” Leppanen said. “Everybody realizes the value of enabling full Web browsing on the mobile device, and carriers are moving beyond being merely interested in considering their options to executing and delivering features to end users.”
Specifically, Opera contends that Mini is drawing major interest from carriers looking to offer mobile Web capabilities to so-called feature phones, or the less sophisticated devices residing in most peoples pockets today.
Introduced in January, Mini is claimed to deliver a better Web experience to low-end devices by using a remote server system to compress Web site content and beam it back to peoples handsets.
In theory, Minis design allows the browser to run on the memory-starved devices that are currently ubiquitous among U.S. wireless subscribers. By simply offering the application for free download, Opera claims to have attracted well over 1 million users, most of whom, it said, view between 8 and 12 Web pages per day using the software.
According to Forrester Research, based in Cambridge, Mass., the mobile Web continues to grow in terms of traffic, but not at a spectacular rate. Based on the firms annual benchmark survey of 65,000 U.S. households, some 15 percent of mobile services subscribers accessed the Internet from their mobile devices in 2005, compared to only 6 percent in 2004. Forrester analysts said they expect that number to increase again in 2006.
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Leppanen said that once Opera has gained major U.S. partners and broader support in Europe, users will give it a shot against Microsofts Pocket Internet Explorer and the browsers offered by various device makers such as Research In Motion.
“The challenge is to educate the end user, we know we can succeed if we can do that, and we need to align ourselves with key partners to help do that in the United States and Europe,” he said. “Weve been working hard on the carriers for two years and I think were on the verge of some major steps forward.”
Another intriguing aspect of the Debitel deal is its planned promotion of Opera Platform, the companys mobile applications development platform.
Using the tools, the telecommunications provider will market mobile work force tools such as forms-based field applications that run in Operas browsers. Leppanen said a number of end-user companies in Europe have also begun building their own tools using the platform.
While industry experts remain skeptical that Opera is ready to challenge Microsoft in the United States any time soon, analysts observed that the T-Mobile deal could be a harbinger of things to come.
“T-Mobile would seem like a strong candidate for a U.S. partner, and it could be a good differentiator for [T-Mobile], as it allows them to offer Web access on a lot of lower-end devices,” said Brad Akyuz, analyst with Washington-based Current Analysis. “However, the average user still doesnt know who they are, and it will be hard for them to create that awareness quickly.”
Akyuz said that Opera Mini does deliver a compelling enough proposition to attract people to use the mobile Web once they have tried the browser out, which he said should ultimately give the company a chance until something better comes along.
Michael Gartenberg, an analyst with New York-based Jupiter Research, said most people didnt expect Opera to have as much success as it already has achieved in bringing its mobile browsers to users.
While the battle for the mobile browser space is sure to heat up, the company has proven its grit to many industry watchers, he said.
“Opera has managed not only to survive but to thrive, and part of that is because their focus on the mobile space is very clear,” Gartenberg said. “Theyve shown the market that html browsing is extremely viable, even on feature phones; the next step is establishing these relationships with carriers and handset makers as something they can monetize going forward.”