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| Why did WAP fail? Why did SMS succeed? It's a case of balancing versatility with practicality, say two implementers of mobile solutions. |
| Singapore |
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| Read this article to understand: |
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 | Why WAP failed | | Why SMS made practical and financial sense to Great Eastern Life | | Why Panin Bank settled for SMS, instead of WAP | | Whether WAP will ever make a comeback | | Why WAP will ultimately fade away |
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| Wireless Application Protocol (WAP) will become the de facto standard in mobile communications, declared its proponents a year ago. |
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| The reasons, they convincingly argued, are blatantly obvious: WAP is not restricted to 160 boring monochromatic characters, it is inherently more secure, it is built with the Internet in mind, and, more importantly, it is open. And because of these alluring properties, droves of users will flock to embrace the new mobile protocol by the end of this year, predicted well-respected institutions like the WAP Forum. |
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| The love-fest obviously never happened. A study by Taylor Nelson Sofres Interactive (TNSi) dated May this year, described just how misleading this prediction was. It pointed out that throughout the Asia-Pacific region, where 57 percent of adults have a mobile phone, only about 14 percent of those phones were WAP-enabled, and only 34 percent of those who own these phones said they use it to access the Internet. The report showed that despite some sporadic instances of WAP faith in some companies, its feature-barren cousin that WAP was slated to replace—Short Message Service (SMS)—seems to be driving the lucrative wireless market world over. |
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| "Why? Because SMS makes perfect business sense," says Mark Lim Kian Wei, head of information technology and e-business at insurance firm, Great Eastern Life Assurance Co. Ltd. And there are plenty about WAP that make business nonsense, including the lack of software to support local languages, the user-unfriendly interface, and the apparent dearth in useful content, says Gary Hong, product manager for Communications Research in Asia Pacific at International Data Corp. |
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| SMS is no silver bullet, either. But it has mass appeal. Walking down any mobile-crazed street of Asia, you are bound to see young adults huddling over small mobile phone screens, busily working their fingers to send SMS love notes. |
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| Logical choice |
| This made Lim come to the same conclusion that many of WAP's detractors have been voicing out in recent months: "SMS is a logical solution for mobile applications simply because it works, and everyone is so used to SMS-ing," he says. |
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| The number of SMS messages being exchanged is staggering—the GSM Association, for example, reported that 50 billion SMS messages were sent worldwide in the first three months of this year alone. Many analysts call this a "cruel slap" on WAP by a technology that was largely an afterthought by GSM phone manufacturers. |
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| SMS also makes sense financially—WAP users often complain about the high call rates and time-based billing methods that nullify any incentive for cost-conscious mobile phone users to move to WAP. "With SMS, we are giving users a sound business proposal on how we can best make use of current and familiar mobile phone technology for their business needs," says Lim. |
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| "That is sound thinking," says Linda Brigance, CIO for Asia Pacific at Federal Express Inc., and an old hand in wireless projects for her company. "It is really about focusing on what your needs are." |
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| Those needs were pretty straightforward for Lim. His company had spent US$1 million to build a brand new insurance portal called LifeisGreat.com. "And through this portal, we re-invented ourselves to become more dynamic as well as reach out to new customers," says Lim. |
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| These new customers, according to Lim, are largely Internet-savvy young professionals in Singapore who are interested in insurance-related policies, but have little time (and patience) to listen to slick presentations from agents. "They want information fast, and they want their needs to be fulfilled fast as well," says Lim. "And if they weren't interested in buying policies, they would not have gone to the website and asked to see an agent." |
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| Lim wanted the resulting leads to be immediately channelled to the right insurance agents (the website allows customers to select their agents). "If not, those opportunities will be lost equally fast." |
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| Visualtron Software Corp.'s VisualGSM Enterprise version 1.0 Mobile Application Server, the SMS-based solution that Lim and Tan decided on finally, currently provides Great Eastern Life with "a robust, secure and open-based mobile services platform that easily integrates with the existing corporate environment," adds Ken Tan, vice president of E-business at Great Eastern Life. |
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| Potential leads are quickly captured by the company's Lead Management System. It then sends two SMS messages to the agent's mobile phones: the first one to inform the agent of the potential lead; and the second SMS to give them the lead's information upon confirmation. The company also uses the SMS service to update agents on their training schedules. |
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| The SMS system visibly reduced the number of phone messages, and improved customer perception of Great Eastern Life agents. "And this obviously led to better sales generation," says Lim, who is still quantifying the returns in absolute figures. |
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| SMS matures |
| Wealth in the features department was WAP's biggest shortfall. It's true that it does a zillion things that text-based SMS can't. But the pixel-heavy protocol also slows the delivery of information—compared to SMS, WAP is no speed demon. |
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| That was bad news for Ariyanto Ruslim. The vice president of Information Technology and Card Center at PT Panin Bank in Indonesia, needed to stem his rivals' gains in mobile consumer banking. "All our senior management in the bank realised that we needed to provide better electronic delivery channels in order to get more new consumer banking customers," says Ruslim. His first choice was a WAP-based mobile banking channel. |
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| "But WAP access requires a specific connection via the ISP the same way as the PC," says IDC's Hong. This is different from the way SMS works, which is essentially a push technology that sends messages. WAP, on the other hand, uses microbrowsers to "pull" content from WAP-ready pages, similar to how a Web browser works, and is dependent on the speed of the connection—which in Ruslim's case is GSM running at a slow 9.6 Kbps. |
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| "That is why WAP is expected to come into its own with the introduction of General Packet Radio Services, or GPRS," adds IDC's Hong. He believes the higher bandwidth networks like GPRS (which runs at speeds up to 150 Kbps, a clear improvement over slower GSM systems) will dramatically increase the take-up rate of WAP. |
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| Ruslim, however, did not have the patience to wait. Slow adoption by the country's telecommunication carriers of new communication technologies like GPRS was also proving to be an additional complication that he wanted to avoid. |
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| So he instead poured US$30,000 into eMobile Pte Ltd's mobile banking solutions, which fills the vacuum between need and practicality with SMS-based solutions. Integrating with existing IBM AS/400 servers used by Panin Bank's retail and corporate banking divisions, and Tandem servers used by ATMs and credit card banking divisions, the eMobile Mbank solution offers security through triple DES encryption and robustness through the familiar SMS. |
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| "Through the menu incorporated in the SIMcards, clients can access all the functions that normally Internet Banking provides," says Ruslim, who hopes to increase the number of new consumer banking customers by a laudable 10 percent. |
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| Resurrection or eternal death? |
| So was WAP a waste? Figures show that, at least for the moment, WAP penetration remains low in the region. "In Asia, Korea has the largest base of WAP service subscribers as it is the only market in the region enjoying access speeds of 64 Kbps," says IDC's Hong. "Although markets such as Hong Kong and Taiwan enjoy high mobile penetration (60 percent and 46 percent respectively), overall WAP penetration in Asia remains low." |
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| FedEx's Brigance believes, however, technologies like WAP will take time to gain acceptance. "New technologies often undergo periods of growing pains when starting up and improving. You definitely have to wait for it to mature." |
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| That maturity and its subsequent renaissance will come very soon, say analysts at Frost and Sullivan. Analyst Jan ten Sythoff concludes that the convergence of GPRS, Bluetooth (the short-range wireless networking technology) and WAP, will help the hapless protocol to gain prominence next year. |
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| The early signs are certainly encouraging. Great Eastern Life's Lim, for example, admits that he is currently considering WAP-based solutions for future deployment. "We do know that WAP will catch up one day, so we are actually participating in WAP trials and are monitoring it closely," says Lim, who recently launched I-planner, a WAP-based locator designed to provide users with an objective tool for preliminary fact finding, in July this year. "Users will be prompted with questions to indentify their needs. And based on their selections, the WAP application will help them to filter down to the plan that suits their needs," he adds. |
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| Panin Bank's Ruslim also believes that WAP will eventually replace his SMS-based services. "We are using SMS as an interim technology as we wait for WAP to mature and be accepted by the masses," he says. |
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| WAP, however, was never built to last. In fact, the protocol was designed from its inception as an interim technology to provide Internet-like services at low bandwidth. And like any good interim technology, it was meant to be replaced. |
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| With 3G, which promises speeds up to 384 Kbps for mobile devices, wireless IP will soon dominate the air waves, said Goldman Sachs analysts Richard Kramer and Brett Simpson, in their report entitled Wireless Wave II: The Data Wave Unplugged, dated December 1999. Wireless IP is generally looked upon as WAP's obvious successor. But 3G's acceptance will take time, analysts admit. "As with fixed line networks, it will take years for circuit switched technologies to be abandoned; equally, it will take years for every device to be packet-enabled," concluded Kramer and Simpson. |
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| Enough time for WAP to be resurrected? The answer is still in the air. |
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| Deputy Editor, Winston Raj loves to hear war stories from the frontlines of IT at winstonraj@idg.com.sg |
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