We all know the advantages: Everyone owns one. We all know how to use them. Women love them and they fit nicely into a pocket. Did I mention they do wireless?
Cell phones seem like the obvious platform for the next generation of billion-dollar startups. But they're not.
Hundreds of web entrepreneurs have gone into mobile. How many successes can you name?
That's what I thought.
What follows is an explanation of why creating a successful mobile-wireless software startup is not just improbable, but impossible. Specifically, why
- The underlying technology is broken
- The business case is a proven recipe for failure
- The social aspects are more awkward than a middle school dance
The underlying technology is broken
1) There are hundreds of different phone models. Your software needs to run on all of them. How hard is this? Nokia makes a competitor to Loopt called Nokia Sensor. In the last five years, Nokia has only been able to get its software working on ten of its forty-three currently sold phones. And Nokia doesn't even have the challenge of porting its software across the operating systems and architectures of multiple manufacturers.
Modifying the software for each phone's display is a matter of brute-force labor. There's no intellectual way around it. Yahoo! is one of the few companies that's been able to pull this off, but only because they have an army of Ph.D. hackers working for them.
You won't have an army of hackers like Yahoo!, nor will you understand the hardware better than Nokia.
2) The carriers partially disable Bluetooth functionality to prevent customers from downloading their own ringtones. This also means all those good features you came up with in the last brainstorming session aren't going to work.
3) In order to load software, you need to buy the optional cable. No one owns the optional cable. Even if you gave your customers the optional cable for free, it only works with windows. Your early adopters use Macs.
4) You don't know how to install software on your own phone, so why would you expect your customers to know how to do it?
5) Any software that pings the cell tower will quickly drain the battery. Pinging the tower every five minutes completely drains the batter in two hours. So much for making calls.
The business case is a proven recipe for failure
6) Cell phone carriers will never partner with you. At least not on terms that allow you to make a profit.
7) Even if one carrier partners with you, the rest won't.
8) The next generation of WiFi will make your product obsolete in two years anyway.
The social aspects are more awkward than a middle school dance
9) Let's say that against all odds you get a few early adopters. To everyone else it will look like they are just sending text messages. Unlike the iPod, your software is invisible. Invisible software isn't viral.
10) You also can't flaunt what you can't see. So much for your idea of your product being a status symbol.
11) Cell phones don't fit into girl's pants. Remember how the women you asked said they would only use your software if it had a vibrate mode? Oops.
The canonical formula for business success is luck, pluck, and virtue. Success in mobile wireless is mostly luck. Maybe some prayer. It pains me to see some of the smartest people I know falling for the mobile trap. I've observed dozens of entrepreneurs go into mobile wireless. All have failed.
That's not to say there will never be a day when it's feasible for startups to venture into mobile. How will you know when the time is right? Ask yourself this question: Could I make money as a distributor of mobile software? If the answer is no (because there is no software to distribute) then find something else to do and check back again in a year. Mobile is still the future and it isn't going anywhere. But in the meantime, better to let others get stuck in the billion-dollar sand trap.