MobUser

Jan 1, 2009 now marks the fifth year that mFoundry has been in business. Without a doubt, we continue to dominate the Mobile Banking space but there have been a number of changes in the market that will dramatically change the way we look at the mobile space moving into 2009.

Device Divergence is Worse Than Ever

The most significant development in 2008 was the further divergence of mobile device platforms. Besides, J2ME/MIDP, Blackberry, BREW and Windows Mobile … we now have iPhone, Android, and 2 new flavors of Blackberry. We have also seen the emergence of the “touchscreen” across a number of device platforms.

I remember when Drew and I were first raising money, a common opinion was that technologies like Mojax wouldn’t have a role in the future of mobile devices because these device platforms would converge into a common platform that software would be compatible with … boy were they wrong! As near as we can tell … the problem is getting worse not better.

The “Indy” Software Publisher Lives!

The Apple App Store was another game changer. It is finally possible for a single developer or team of developers to actually make money selling software for mobile. There are more independent software publishers now than there was ever before! I find this to be the most exciting development in mobile … even more exciting than the iPhone itself (and that is saying a lot). Great software has almost always come from small teams and individuals working out of their “garages” … now these guys can do that and make a living too.

America Has a New “Mobile Savvy” President

Needless to say, I voted for Obama and was one of the millions of Americans that rejoiced when he was elected. Perhaps less news worthy, but this President and his staff understand the power and opportunity that comes from leveraging the Internet and Mobile services. His campaign and staff leveraged the Mobile and Internet channels in ways that would never have been possible even a few years ago.

“Feature” Phones Have Become Less Relevant

I’ve personally never understood why they call them “feature” phones … I’d call them “featureless” phones myself … but the J2ME/MIDP and BREW devices of this world are becoming less relevant. This is not because there aren’t a ton out there … its because people that have them are less likely to use data services or know how to download content to their device.

Our experience confirms this as well. People that have iPhones, Blackberries, and Windows Mobile devices are much more likely to use data services, browse as website, and download and application to their device than someone that owns a traditional “flip” phone. The cost of these “smart-devices” is also going down, making it possible for lower income individuals to purchase and use these devices.

Given the expense of supporting “feature” phones, I suspect that most content providers will give up trying to create new content for these devices and focus exclusively on the smartphone. I’ll go one further … I think that the iPhone will be the primary device for applications, and other “smartphones” will be supported via a mobile-optimized website.

The Economy “Tanks”

Perhaps the most significant development of 2008 was the nose-dive the economy took at the end of the year. So many of the mobile startups that I knew in 2008 are now out of business. Fortunately mFoundry was not in a position to need to raise money. We are secure for the moment, we have money in the bank, recurring revenues, and a respectable pipeline going into 2009. That said, I’m sure we’ve yet to see the end of this downturn. There will no doubt be some unpleasant surprises in 2009 that I’ve yet to imagine.

What Does the Future Hold for mFoundry?

At this point it is hard to imagine what is in store for mFoundry. We are being conservative this year in our spending so I don’t expect anything tremendously innovative from a product standpoint but rather evolutionary. We will continue to do what is working for us … mBanking … and we will make sure we are releasing the best software we can. At the end of 2009 I’d like to be able to say that we’ve got almost a hundred banks and line-of-sight to a few hundred more going into 2010. We will focus less on feature phones and instead look to provide turnkey mBanking services for the “right” devices.

Happy New Year, and best wishes to everyone!

Rodney Aiglstorfer