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

mFoundry Establishes itself as a Mobile Banking Market Leader

Without a doubt the single biggest business achievement in 2007 was the incredible success we achieved in the Mobile Banking sector. When we committed to mBanking as a vertical we were all hopeful that the gamble would pay off and it certainly has indeed. As we move into 2008 we have tremendous support from leading Banks, Operators, and Strategic Partners.

mFoundry Closes its Series C Financing

One of the most significant business events in 2007 was the closing of our Series C. Compared to previous rounds, this was the easiest. Our story was tight and we had a very clear business strategy that resonated with our investors. Aside from the addition of cash, this Series C brings with it a collection of very powerful strategic partners that will no doubt help to shape our future.

Firethorn is Aquired by Qualcomm

In a surprising move by Qualcomm, Firethorn was purchased in the later part of 2007. Firethorn has been considered by many to be our closest competitor in the Mobile Banking space. The acquisition by Qualcomm galvanized the Mobile Banking vertical and has sparked a wildfire of interest in us from Qualcomm’s competitors. This was perhaps the best thing that could happen to mFoundry (short of being purchased ourselves) as it instantly gave credibility to the Mobile Banking and Payments space.

Mojax Reaches 1.0 on J2ME and BREW

This took longer than I expected but I am very please to say that, after a year of development, we have a candidate release for Mojax 1.0 on both J2ME and BREW. This is due entirely to the excellent team of engineers and QA testers that all helped to bring Mojax to life.

Mojax continues to be what I consider the single most effective way to develop mobile applications. Though we have leveraged the power of Mojax in the pursuit of Mobile Banking, it is my continued vision to also see Mojax powering a myriad of other verticals. Our private Beta in 2007 has grown to almost 500 developers from all around the world. I am looking forward to continuing to grow our developer community and provide a simple and effective way for them to create mobile applications.

Apple iPhone and Google Android Introduced to the Market

One of the greatest strengths of Mojax is the fact that it will work on BREW and J2ME, two platforms that are so completely different from each other that developing or porting any application to them requires at least two development teams. Conversely, a Mojax Moblet created once (in a fraction of the time), will immediately run on both BREW and MIDP without ANY additional work. The introduction of the iPhone and soon Android devices into the market only further adds to the overall entropy in the mobile application space. Android, being Java-based, is the “easier” of the two new platforms to support; but iPhone is likely to be Objective-C based which will again require a separate development team to support. I have put the iPhone and Android on the Mojax roadmap for 2008 along with Windows Mobile.

What Does the Future Hold for mFoundry?

From a company perspective, 2008 will see mFoundry transition from 100% product development into a mix of development and product support. Our company size will grow as we add product solutions and support capabilities as well as ramp up our direct sales efforts. We will also continue to add to our list of mBanking channel partners.

Mojax will be ported to Windows Mobile, Android, and iPhone by the middle to end of 2008. Additionally, support for 3rd party Mojax Plug-in development will also be a priority for the early part of 2008.

By the end of 2008 I expect mFoundry’s product stack to be the most pervasive Mobile Banking platform in the US and for Mojax to be used by 3rd parties to create new exciting mobile verticals. 2007 was an exciting year but I expect 2008 to exceed our expectations.

Best wishes to everyone and to all a prosperous New Year!

- Rodney Aiglstorfer

This round will give us the “endurance” to fully play out the Mobile Financial market here in United States as well as to push into Europe. However what really makes me excited is the potential all this has for Mojax. 2008 is going to be a very exciting year!

The real story of Citi Mobile’s launch in April is not in its bill pay or funds transfer features, but how it’s delivered. Citi’s mobile offering is a downloadable mobile application built through a development toolkit from mFoundry that comes from the bank, rather than within the service container of a carrier’s menu. “Citi has taken a longer, harder look at long-term strategy” TowerGroup’s Bob Egan says, “and they’ve made a decision they want to own the infrastructure.” Most of the major m-banking intros in 2007 have centered around the managed services platform offering of Firethorn Holdings, an Atlanta developer that stoked regional deals with BancorpSouth, Regions, Wachovia and SunTrust Banks with an exclusive platform arrangement with AT&T, the wireless carrier with the largest subscriber base.

But mFoundry, with the Citi Mobile experience as the driver, may be better positioned to land forthcoming deals with national institutions focusing on adaptability for long-term shakeout in the mobile banking space. How will payments be handled? Will the database players shake the business model at some point?

mFoundry’s Spotlight provides control of the endpoint look-and-feel, adaptability to a bank’s online authentication, and has a head start in other key payments areas: it is already developing an integrated contactless payments platform with ViVOtech and has a formal relationship with First Data to handle money movement. “I believe you have to have an open ecosystem,” says mFoundry CEO and co-founder Drew Sievers. Some have likened the mFoundry/Firethorn rivalry as a replay of the Corillian/Digital Insight battle: DI with its plug-n-play templates, and Corillian’s customizable platform that large banks coveted. While the future is far from clear on mobile banking, any future will have to include the ability for a mobile solution to work within the lifetime value cycle of a customer. That’s going to take a major shift in the relationship with telcos. “Banks are moving to reengineer a lot of their architecture for things like SOA,” he says. “They’re not going to want to spend the equivalent of $1,000 a user to get mobile banking people developed as another delivery channel.” – GF

Technorati Tags: Banking, Business, mFoundry, mobile, moblet, mojax, Spotlight

Technorati Tags: mojax

Many approaches to transcoding Mojax were considered, but at the end of the day we decided that we would use OpenLaszlo as the target for the transcoder instead of directly transcoding MJX files into DHTML. I could list many reasons why OpenLaszlo is the better method of generating DHTML, but at the end of the day it came down to the fact that we all really hate working with HTML. OpenLaszlo’s language constructs and object model is pretty close to our own which will make the task of transcoding much simpler. An additional benefit to creating an OpenLaszlo transcoder is the fact that the Moblet, once transcoded, could also run as a Flash application.

It should be noted that by having a DHTML/AJAX transcoder for your Moblet also means that, in addition to running on an iPhone, your Moblets could also:

• Run within an iFrame on your website
• Run as a Gadget on your iGoogle home page
• Run as a portlet in Netvibes
• Run as a Widget on your Mac

Pretty cool stuff!

Technorati Tags: AJAX, mFoundry, mobile, mojax, OpenLaszlo, transcoding

To that end I make the following promises …

Mojax Will Be Free to Use

Some of the most innovative ideas will come from individual engineers and small companies that cannot afford another technology investment. We will never charge for the use of Mojax. Instead we will provide value added services around Mojax … all of which will be entirely optional.

Mojax Will Be Pervasive

Mojax will run on all mobile device platforms. Before the end of this year you will already see support for J2ME, Blackberry, Windows Mobile, BREW, and WIPI; with support for a Native Symbian and Palm runtime sometime next year. You will never have to know *ANYTHING* about individual devices, you will never have to “port” your application or test on every device you want to run on … its the closest thing to “write once, run everywhere” you will likely ever get.

Mojax Will Download OTA

The Mojax runtimes are extremely small and are designed to be downloaded “Over the Air” (OTA). These runtimes will not need to be pre-installed by Operators or Device Manufacturers.

Mojax Will Always Be About the Mobile Device

I have no desire to see Mojax running on set-top boxes, toasters, desktops, or any appliance for that matter that is not a mobile device. Mojax will be highly specialize for mobile devices and will always strive to expose all aspects and features of the mobile device to the moblet developer.

Mojax Applications Will Be Easy to Develop

No one has the time to learn yet another development language and methodology. Mojax will leverage all the standards and concepts that have become standard in the Web development world (e.g. Javascript, CSS, XML, XPath).

Mojax Applications Will Be Easy to Deploy

If you have a Web Server, you will have everything you need to deploy a Mojax application.

Mojax Will Be Extensible by 3rd Parties

Mojax was built from the ground up to support plugins (or components as we call them). This extensibility will be available to more advanced developers that want to incorporate specific mobile technologies into Mojax.

Mojax Will Be Business Friendly

For as many problems as there are with mobile, there are just as many business models. “On-Deck”, “Off-Deck”, Ad-Funded, Subscriptions, One-time-fees, and the list goes on … Mojax will be licensed in such a way as to not preclude any business model. If you can find a way to make money off of your Moblet … GO FOR IT!

2006 was a pivotal year for mFoundry. Looking back on 2006 I can see how much we all accomplished and learned. Going into 2006, mFoundry struggled to find the right business application for its technology. mWorks, our flagship product, was a mature platform upon which mobile applications were being quickly and cost-effectively developed and deployed across a broad range of J2ME and BREW devices. However, we realized early on that without a strong business vertical or “killer-app” to put the platform into context, it would be difficult to build a sustainable business around just the mWorks platform itself.

The following is an account of what strategies and markets we went after and their results …

“Premium” Mobile Application Revenues Sucked
The biggest disappointment of 2006 were Sold-to-Consumer or “Premium” mobile applications. Luckily, we discovered early in the year, that premium mobile content was a terrible business for anyone except the Carrier. Carriers took a hefty chunk of the revenue and the rest was split between us and the content owner. Consumer adoption of a premium application was heavily dependent on promotion by Carriers as well as by the Content providers. Carriers would not promote to the degree necessary to generate an interesting amount of adoption; and in the case of the Content providers, the Mobile application was a small part of their overall service and were not motivated enough to promote it heavily either.

None of us at mFoundry much cared for the concept of “Premium” applications but saw that it was the only way to get into the carriers and so did what was necessary. The one positive result from our escapades in “Premium” Mobile Applications was that we were able to create some lasting relationships with carriers and demonstrate to the world that mWorks was a real solution that worked … and worked well.

Free “Ad-Based” Mobile Applications Show Promise
Much later in the year, we created a very cool Moblet for Sprint called the “Sprint Mobile News Stand”. It is distributed for Free and promoted by the Carrier heavily. It contains some advertising and some sponsored content. Adoption of the Free content was SIGNIFICANTLY higher than any of the premium applications (not surprisingly) and the retention was better as well. It is a little early to tell … but this continues to be an area of interest to me and I look forward to seeing more Ad-Based/Free mobile applications in the future. In fact, I have created a small company called CellShift to explore how social networking, the Web, and mobile could be combined to create a compelling Free-To-Consumer/Ad-Based business.

Mobile Applications for Work Groups are a Proven Success
Some might rather refer to Mobile Applications for Work Groups as Mobile Application for the Enterprise, but I disagree. As it relates to a Business, most useful mobile applications enable smaller work groups rather than entire enterprises. mWorks is ideally suited to enabling specific tasks that are better served in the field where a laptop is impractical to too expensive. In 2006 we created some compelling mobile solutions for Work Groups that save their companies millions of dollars in costs that were eliminated as a result of the moblet. Success in this area has spurred other companies to license mWorks directly and build solutions for themselves. Mobile solutions for Work Groups is uniquely suited to mWorks because it can be licensed very cheaply and need not have massive adoption to be financially interesting to mFoundry.

Banking, Banking, Banking
In early 2006 Citi selected mWorks as the platform for their mobile banking product. This opportunity taught us much about the mobile banking space and by the end of 2006 we had a fully crafted offering called mBanking that we are now actively selling. mBanking will likely become the most significant solution developed using mWorks. Point in fact, it has opened opportunities and partnerships that would not have been possible had we been only a platform company. I can’t disclose the specifics of these partnership at this time but we will be making several announcements early this year.

mojax, The Next Generation
As compelling as mWorks is, I wanted to do more with mobile. As early as November 2005 I started to design a new platform called mojax. mojax is one of the worlds first Mobile AJAX Application Frameworks. Unlike traditional AJAX Web Frameworks, mojax Moblets do not run within a browser and are not subject to the availability and quality of a network connection. Also, unlike a web application running on a mobile device, a mojax moblet has access to lower level device features such as Camera API, Push Messaging, Bluetooth, Location Services, Contacts and more. Unlike mWorks, mojax is an extremely open system that leverages existing open standards such as XML, CSS, and Javascript to enable developers to create applications with even greater functionality that before but still maintain all the benefits of mWorks (e.g. Device agnostic, Easy to develop, and extremely cost effective to deploy). Mojax is nearing the end of its beta phase and we should start to see deployments of mojax as soon as Q1 of this year.

As you can see it really has been an exciting year. I can’t begin to imagine what 2007 holds in store for us. Best wishes to everyone and to all a prosperous New Year!

- Rodney Aiglstorfer