As the number of software apps installed in mobile phones soars, mobile software management or MSM is increasingly becoming a vital business concern for operators, manufacturers and mobile software developers.
Bitfone (now part of HP) and InnoPath were the early leaders in the field. But Red Bend Software, a small Israeli company now headquartered in Boston, which originally started in 1999 to commercialize a mathematician's compiler dreams, has come out from nowhere to claim the lion's share of the market in just two years.
With its flagship vCurrent Mobile solutions, Red Bend has had a storming 2007 - in the first six months of the year shipments rose from 80 million to 150 million in 96 handset models and 12 platforms. The company expects to ship 50 million OTA packages in the third quarter and 80 million in the fourth quarter.
Over the past year, Red Bend CEO Yoram Salinger has been a frequent visitor to Japan, where he is spearheading collaboration with Japanese handset manufacturers and operators.
For example, SoftBank's first firmware over-the-air (FOTA) implementation was with Sharp handsets and played a key role in the operator's success in rolling out new phones to lure subscribers. Six of SoftBank's best-selling handsets are Sharp models with the integrated vCurrent Mobile solution.
FOTA technology has emerged as the main delivery mechanism of MSM capability. Its ability to quickly and cheaply install, upgrade and repair firmware allows phone makers and operators to roll out products faster and with less risk.
Red Bend's software is also set to appear in three NTT DoCoMo handset models at the end of the year or early 2008.
Apart from these tie-ups, NEC, Toshiba, Japan Radio Company (JRC) and Sanyo have also signed contracts with Red Bend. JRC is implementing Red Bend's solution for PHS operator Willcom.
'The FOTA market is going to exceed $100 million by 2009,' Salinger told Wireless Asia during a recent trip to Japan. He claimed that Red Bend now has over 50% market share partly due to its solutions replacing Bitfone's in Motorola handsets. 'Our goal is 80% in '08.'
Red Bend's strategy is different from its main FOTA rivals. 'We are not trying to do end-to-end services like Bitfone and InnoPath,' explained Salinger. 'For example with SoftBank, NEC handles the server side and Red Bend handles the client side.'
Salinger cited the example of a Japanese carrier that doubled its subscribers' flash memory from 500 MB to 1GB by updating the driver using vCurrent Mobile and were then able to update one million handsets overnight in June.
Although it is thriving in Japan, Salinger pointed out that Red Bend is a global player, with R&D facilities in Israel and offices in the UK, as well as in Korea and China. Korea's LG Electronics, for instance, is a customer.
He explained that China is an important market due to its huge population and also because its biggest operator has shown interest in offering value-added services to subscribers.
China, he added, could also be a key to big market players like Motorola and Nokia, although his company has abandoned a strategy to woo OEMs in the mainland at this point.
'China is an emerging market, but Japan is by far the most important with respect to device management,' Salinger said. He noted that it's no secret that Japan is one of the leading markets in adopting new technologies. 'All the phones in that market are feature-rich, and the amount of software in those devices doubles every year or two. I think a lot of other markets are going to adopt everything that goes on in this market.'
He predicts Japan will be Red Bend's biggest market in 2008, accounting for 30% to 35% of its business, with the US and Europe close behind.
The company in June launched version 5 of vCurrent Mobile, whose optimization improvements reduced delta files by 10%, resulting in faster downloads. The latest release features 'background updating and revertibility,' which enables users to roll back or cancel upgrades and even downgrade if they wish. This allows operators to offer services and products on a 'try and buy' basis.
Salinger said Red Bend's quick success can be attributed to its emphasis on innovation and its service approach toward customers.
Red Bend signed a contract with Italian operator Telit this year to provide OTA solutions in the M2M (machine-to-machine) business segment, particularly for utility meters, car fleet management, vending machines, among others. M2M is forecast to be a $500-million market by 2010.
Salinger said Red Bend will launch at yearend or early 2008 an OTA product line dubbed vRapide Mobile, which targets a new MSM market segment - software component management. Salinger said vRapide Mobile is an 'elegant and easy solution' with revenue-generation opportunities across the entire mobile value chain - pre-sales, point-of-sale and post-sales.