Opera Mini Mighty Market Maker

In case you’ve been living in a cave, Opera’s strategy for mobile devices using the Internet has come up with a real market maker. Opera mini is a full web browser that runs on a wide range of mobile phones. Opera’s use of and experience with AJAX technologies led to the development of Opera mini for low-end phones. Server side technology development is the magic behind the Mini. Opera’s marketing strategy of giving away the software to build a customer base for firms that license Opera mini for their cell phones is a market maker.

Released in January 2006 for full commercial use, the beta trials that were announced in October 2005 garnered over a million downloads. Opera is building market share by following the same path for Opera mini that it established in September 2005 when it dropped the licensing fee for its desktop browser.

The way this marketing strategy works is that Opera licenses the Opera mini to mobile telecommunications carriers and to handset manufactureers. They make money by selling time on their networks for end-users. Opera’s mini software is attractive enough to encourage end-users to try other services with their cell phones including web browsing, using data services such as stock price alerts and sports scores, and downloading multi-media products like ring tones, pictures, and video clips. The more users who download Opera mini, the larger the installed base of the product, and the more cell phone operators will want to license it from Opera to sell cell network time to subscribers.

According to Eskil Sivertsen, an Opera public relations manager, End-users get to surf the real Web on their phones, faster and cheaper because of Mini’s compression; Operators get all this data traffic from users that would normally not be surfing if it hadn’t been for Mini; Content providers reach the mass market with their existing sites and services.

In short, Opera mini is making the market for the mobile device industry. In April 2006 Opera reported that its Mini software was rapidly increasing billable network traffic for cell phone operators. Opera said more than two million people were using the Operas Mini by surfing the web on their phones.

Some background on all this is probably in order. Opera mini works with AJAX technology. That acronym stands for “Asynchronous Javascript and XML.” This isn’t a new programming language. It is a collection of technologies. The intent is to mediate the relationship between the end-user’s device, such as a desktop PC or web-enabled mobile phone, and the server sending the data. The key benefit is that the entire web page, like this one, doesn’t have to be reloaded everytime the user makes a change. The result is smaller amounts of data are exchanged and response time increases with a better web browsing experience for the user. The most significant advantage is that users can get web browsing experiences on their cell phones similar to what they are used to on their desktops.

This advantage isn’t lost on Opera which pushes the concept in its promotion of the product to cell phone operators. Opera said in April 2006, Users can visit the same Web sites they can browse from their desktop and in the same way, using Web address formats they are already accustomed to. As Opera Mini is based on Opera’s core technology, it is tried and tested and has everything users would expect from a browser including search, bookmarks and history.

Opera software has done well exploiting AJAX technologies with the Opera Mini. Since January 2006 the firm has inked a number of deals with cell phone and network operators. In February 2006 Opera signed up MediaPlazza, a global distributor of media content to cell phones. The deal puts the Opera mini on cell phones in 60 countries. In March 2006 Opera signed a deal with T-Mobile to put a customized version of the Mini on high-end phones in Europe including devices made by Sony and Motorola.

At this point Opera is making the market for web-enabled electronic commerce on cell phones. Version 2.0 of Opera Mini released this month goes right for the ecommerce sweet spot by making it easier for people to buy things with their cell phones. It links transactions to the network operator’s billing system and keeps the user on the web page where they found the product. Another cool feature is speed dialing for your favorite web page using a bookmark.

Other software developers aren’t sitting still while Opera scoops up all the marbles. A quick review of products includes Thunderhawk by Bitspream, Nokia’s browser for their series 60 phones, and a new service from America Online (AOL) that competes head-to-head with Opera. According to PC Magazine, AOL’s browser service competes with Opera Mini from Opera, which uses a similar trick of reformatting pages on a server to get around the limited processing power of many phones. But Opera Mini is a Java application you must download to your phone, where AOL’s service works through the phone’s existing WAP browser.

The competition is heating up. According to ZDnet, Microsoft, Palm, and others are racing to bring products to market, Microsoft, Palm and Handspring all offer browsers designed to view full HTML Web pages on handhelds, with Palm and Handspring’s models relying on proxy servers to do much of the necessary reformatting.

Microsoft is purusing mobile web browsing, but some analysts think the Redmond software giant is stuck on desktop technologies and will be undercut in terms of market share by mobile browsing. Little has occured with Mozilla’s Minimo mobile browser which is still in development.

One Internet analyst said that Opera’s technology was substantially better than anything else available. I think it’s absolutely phenomenal technology,” said Michael Gartenberg, analyst with Jupiter Research, when the browser first appeared. “This is the kind of situation where Opera could potentially give Microsoft a run for its money in mobility.

Another prize in the mix is targeting advertising the cell phone users surfing the web through their wireless devices. Tom Burgess, CEO of Third Screen Media, says “the small screen is clearly ready for prime-time advertising.” In an interview with MediaPost Publications, Burgess says targeting will be very precise, by handset, user, demographics, time of day, and even location. Products supported by paid targeted advertising will include video, voice/data, Java applets, games, and text messaging. Actual usage behaviors will be readily available to cell phone operators and content providers based on number of impressions per page and click through traffic. You will have lots of options but you may not have much privacy. However, your data will be merged with millions of others leading to a contradictory case of personalized anonymous surfing.

This revenue potential is clear to Opera and Google. In December 2005 the two firms inked a deal that makes Google the default search engine for Opera’s browser on cell phones. Opera earns revenue from Google when users click through on targeted ads that appear with search results.

This is an exciting market to watch, and in the coming months I’ll continue to focus on the crossover between desktop and mobile web browsing.

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