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    Visto Demands Moment in Spotlight

    Written by

    Matt Hines
    Published December 15, 2005
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      With its sudden rise to the forefront of debate over which technology providers are best positioned to cash in on the growing market for mobile e-mail infrastructure, Visto Corp. is framing itself as the Rodney Dangerfield of the industry, and demanding some respect.

      On a practical level, the company did just that Thursday, filing a patent lawsuit against Microsoft Corp. that could conceivably delay the launch of the software giants Windows Mobile 5.0 operating system.

      The legal news followed Wednesdays announcement that Visto had signed a technology licensing agreement with NTP Inc., the company wielding its own patent win over BlackBerry service provider Research In Motion Inc. that threatens to shutter the popular service.

      Some industry watchers believe that Vistos moves this week may be aimed directly at raising its profile among a sea of potential competitors, which includes larger players such as Microsoft, RIM and Nokia Corp., and some equally lesser-known firms like Seven Networks Inc.

      But Visto Chief Technology Officer Daniel Méndez cringes at that assumption, and says his company is merely protecting its hard-earned intellectual property and saving itself from future patent disputes.

      Visto deserves to be considered among the leading providers of mobile e-mail technology based on its carrier deals and growing customer base, the executive said.

      If people view this weeks spate of activity as a headline grab, said Méndez, theyre not looking at the companys viewpoint hard enough.

      “We have significant contracts around the world, and a rapidly growing base of users, so we wouldnt put ourselves in this position just to get headlines; headlines are ephemeral and they go away,” the CTO said.

      “We feel that we are in a nascent, exploding market that we have worked very hard over the years to establish, and we dont want to see anyone else come into the market and benefit from our innovation.”

      Unlike RIM, the current poster child for mobile e-mail service in the United States with its 3 million-plus subscribers, Visto provides its technology to carriers, rather than consumers, who in turn create their own wireless data offerings built on its infrastructure.

      The companys biggest deal to date is the pact it signed in November with U.K.-based Vodafone, but Visto also has smaller deals in the United States with Sprint Nextel Corp., Cingular Wireless and Ericsson Inc., and supports more than 20 different carriers worldwide.

      Méndez said that Vistos e-mail technology currently supports “several hundred thousand” customers and more than 60 wireless devices, but he expects those numbers to grow as Vodafone and others bring more services to market and attract new users.

      He said that the companys status as a white-label, or silent partner provider to the carriers, hasnt given it as much exposure as RIM, but he feels that Vistos presence could soon match its rivals.

      “Were not a new company; weve been in business for 10 years providing these same types of technologies, and thats why we have these fundamental patents of our own,” he said.

      “We were developing this technology before there was a market for it, and it has taken a while for people to catch up to our vision; with the NTP deal, we feel that were the only company out there that is really able to cover ourselves and the carriers, unencumbered by future [intellectual property] concerns for customers.”

      Next Page: Microsofts history.

      Microsofts History

      On the topic of Microsoft, the executive said that Visto felt compelled to get its claims filed before Windows Mobile 5.0 officially arrived on the market.

      He said that every company in the space needs to be sure that such a large player isnt allowed to take advantage of potential patent loopholes.

      “[Microsoft] has a history of walking into markets and ignoring the people who have been there for a while, and were going to make sure that the innovations that weve created are protected,” Méndez said.

      Microsoft representatives declined to comment on the impact of Vistos lawsuit.

      While the wireless e-mail portion of Windows Mobile 5.0 has yet to be released to customers, the technology is already supported by a number of wireless devices made by the software giants partners.

      /zimages/6/28571.gifTo read more about Microsofts plans for Windows Mobile 5.0, click here.

      Industry analysts said that Visto, along with Seven Networks and Nokia, could be poised to win more carrier deals, but pointed out that mobile e-mail is still a nascent market.

      If Visto is able to prove itself in the European sector through Vodafone, experts said, the firm could have as good a chance as any to grow its distribution and clout.

      Some industry watchers said that the RIM-NTP patent spat can only help to boost the prospects of the BlackBerrys rivals as carriers look for alternatives and wait to see what becomes of the lawsuit. Many wireless carriers are also interested in keeping their own brands on new data services, rather than giving more business to RIM.

      /zimages/6/28571.gifClick here to read more about the battle between RIM and NTP.

      “The wireless e-mail market is in the early stages overall, and RIM has jumped out ahead, but its still a fairly untapped marketplace,” said Gene Signorini, analyst with Boston-based Yankee Group.

      “In the U.S., theres probably only 10 percent penetration of the addressable market, so theres a significant amount of opportunity left and the carriers have really just begun evaluating how they can brand and sell these wireless data solutions for themselves.”

      In terms of slowing down Microsofts bid to aggressively enter the wireless data space through Windows Mobile 5.0, the experts were more skeptical.

      But, beyond its actual legal chances, said Signorini, the company is showing that it ready to fight larger rivals attempting to move into its market.

      The lawsuit could also stand to benefit other industry players trying to compete with Redmond, Wash.-based Microsoft if it does delay Windows Mobile, he said.

      Stephen Drake, analyst with Framingham, Mass.-based IDC, declined to analyze the technological aspects of the patent dispute between Visto and Microsoft, but said that the smaller firm could attempt to use evidence successfully entered in its legal battles with Seven to try and stop Redmonds mobile e-mail plans, just as NTP is menacing BlackBerry.

      “The suit has the potential to slow Microsoft down as weve seen with NTP-RIM, at least in terms of Microsoft being forced to pay attention to it,” said Drake. “Its hard to say that if it goes through it could keep Microsoft out of the market, but it makes Visto look like theyre standing up to the big bully, and putting their technology on the line and saying theyve been doing it for a while.”

      Drake said that carriers are likely to look at the companys work with Vodafone more than any litigation, in terms of judging its long-term viability, and the analyst pointed out that the deal has yet to result in a related services launch. Looking forward, he said that Visto will have a chance to prove itself with other carriers, and that the current wave of publicity cant hurt its prospects.

      “Visto is in the mix, mobile e-mail is something everyone talks about, and theres a lot of buzz, but still in the early stages of this marketplace,” he said.

      “Theres no bad publicity for them here with all the news; a lot more people are paying attention to them all of a sudden, and theres certainly something to be said for that.”

      /zimages/6/28571.gifCheck out eWEEK.coms for the latest news, reviews and analysis on mobile and wireless computing.

      Matt Hines
      Matt Hines

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