Mobile email: When push comes to shoving

3GSM: Microsoft is stepping up its drive into push email technology but it faces some stiff competition for the hundreds of millions of enterprise mailboxes up for grabs

In one of a slew of announcements made on Monday at the 3GSM World Congress in Barcelona, Microsoft revealed that it is stepping up its campaign to seize a chunk of the mobile email market. This increased focus includes the release of four new devices built by HP, with Microsoft's new push-email functionality built in, together with several high-profile deals with service providers such as Vodafone to allow more customers to take advantage of the new systems.

Microsoft's interest in push email is natural given the size of the potential market. Some estimates put the number of corporate email inboxes globally at 650 million. Not all of these users will want or be prepared to invest in mobile mail but it is clear that there is a substantial market to tap. The software giant is hoping to use its size to undercut much of the competition and is offering its Messaging and Security Feature Pack free to customers who already have Exchange Server 2003 and Windows Mobile 5.0.

As well as the huge potential revenues, Microsoft is keen to extend its dominance of PC-based productivity software to the mobile market. Speaking at 3GSM this week, Pieter Knook, Microsoft senior vice-president for communications, said that offering mobile email to its customers is part of a wider push to give enterprise users mobile access to many of their PC-based applications.

"Our mobile version starts with work productivity — MS Office and Exchange. With mobile we extend that beyond what is available the PC. It is all about having the ability to take Office on the road with you," Knook said.

However despite its size and the dominance of its Exchange back-end platform, Microsoft is unlikely to have things all its own way. The sheer size of the potential market for mobile mail has lead to some vigorous jostling for position by the various existing players and new entrants. Datamonitor expects mobile operators' revenues from enterprise mobile email and PIM alone to total $600m (£300m) by 2009.

Research in Motion has enjoyed a comfortable lead over other suppliers for the last three to four years, thanks to the insightful vision of its management which saw the potential popularity of providing mobile workers with access to their email.

RIM has around 4.3 million subscribers, out of an estimated six to ten million mobile email users worldwide.

Another competitor faced by Microsoft is mobile handset maker — and nemesis of old — Nokia. The two firms appeared to be on more peaceful terms at last year's 3GSM when they announced a deal in which Nokia licensed Microsoft's music player, but the gloves are off again when it comes to mobile email.

In 2005, Nokia acquired Intellisync, the number two player in the mobile email market, for $430m. Speaking at this year's show, Jorma Ollila, Nokia's chief executive, said the acquisition was...

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... now finalised and the Finnish handset maker was now clearly focused on providing its customers with seamless access to email on the move.

Ollila added that Nokia Business Center, a software product enabling push email and other collaborative business applications, has already been sold to 40 companies in Europe. "We will be able to connect any device from any vendor and work with almost any data source and any network," Ollila said.

Apart from the flurry of vendor pronouncements, another clear sign of the intense competition in this area at the moment is the amount of litigation stacking up. RIM is currently caught up in a patent infringement case with patent-holding company NTP which could see the Canadian email leader's mobile business suspended in the US, although the High Courts recently ruled in RIM's favour in a case that could have had similar ramifications here,.p>

RIM announced last week that it has developed some "alternative" technology keep it systems running if it loses the NTP case, but much of the damage has already been done in terms of the company's profile and user's trust.

But RIM is not alone in facing legal woes. Several other players in this area including Microsoft, Good Technology and Seven have been sued by mobile technology company Visto for alleged patent infringement.

Paul Hedman, managing director for Seven in Europe, the Middle East and Africa, claims that litigation is simply "part of the US way of doing business" and a clear sign of the huge opportunities available to whoever manages to remain a technical leader in mobile email. Seven claims that while NTP's legal action against RIM has not been good for the sector as a whole, it has helped steer more customer's Seven's way.

"It's not good for the market, but for us it has been fantastic. We have seen a five-fold increase in enquiries from enterprises and other smaller and mid-sized businesses," says Kate O'Sullivan, Seven's vice-president of corporate marketing.

Seven has taken a slightly different approach to RIM'S distinctive but quirky proprietary hardware, and has adopted what it claims is a "device-agnostic approach" to providing mobile email. The company claims that users can access its technology on over 100 mobile devices, making it significantly cheaper to set up and run than the BlackBerry-based alternative. Hedman claims that his firm is now second after RIM in terms of number of licences sold and now has over 80 partners in 47 countries.

Although Seven is relatively small compared to Microsoft, Nokia and even RIM, Hedman is confident that his company can hold its own. He was dismissive of the latest announcements from the larger vendors ranged against him, claiming that while Microsoft may have massive resources it is limited to supporting those organisations that run on its Exchange back-end, and pointed to the huge number of users of rival email system Lotus Notes in countries such as Japan.

With regards to Nokia and its acquisition of Seven's rival Intellisync, Hedman claimed that Nokia's combined hardware and software package would not pose too much of a problem to his business as ultimately the large operators have the most say over what software is integrated into handsets.

Give the intense competition in this area, the prognosis for any enterprise or smaller business that hasn't committed to one vendor for mobile email is to await developments. Further consolidation is extremely likely and lock-in should be avoided at all costs.

One option for smaller players may be an entirely hosted system, available from some service providers, which will help to insulate against some of the upheaval that this growing arena will continue to experience for some time yet.