Microsoft, Ericsson Launch Mobile E-Mail Venture

Buoyed by news that the European Commission will not present any regulatory roadblocks, Microsoft Corp. (Nasdaq: MSFT) and Ericsson (Nasdaq: ERICY) announced the launch Monday of a mobile e-mail services venture.

The new operation, to be called Ericsson Microsoft Mobile Venture AB, will be functional by the end of the year, the companies said. The venture will combine the founders’ resources and technology to get a jump on the competition in an emerging and competitive mobile Internet market.

“Mobile e-mail should be as easy as talking on a mobile phone, which is what we will help the mobile operators deliver to their customers,” said Ulf Arvin, president of the new company.

Arvin added, “There is broad recognition that mobile e-mail is one of the key applications needed to create a mobile Internet mass market. We already have had discussions with leading operators that show a strong interest in these types of solutions.”

Arvin said those operators are in the United States, Britain, the Netherlands, Germany and Scandinavia.

Web on the Move

Ericsson has predicted that by 2003, mobile phones and other wireless devices will replace personal computers as the primary way of accessing the Internet. The company has also predicted that the total number of mobile Internet subscribers will reach one billion by 2005.

The venture between Ericsson and Microsoft is “clear proof of the marriage between mobility and Internet,” said Ericsson’s Lars Boman. “Providing people with e-mail anywhere, anytime, will serve as a strong driver for the new mobile Internet market.”

Ericsson owns 70 percent of the new venture, while Microsoft owns the remaining 30 percent. The company will be headquartered in Stockholm, Sweden, with regional offices around the world.

Wider Partnership

The initiative is part of a wider partnership between the two giants. For example, Microsoft’s Mobile Explorer browser will be integrated with Ericsson’s mobile phones. Also, Ericsson will license its Wireless Application Protocol (WAP) technology for use in Microsoft products, and Microsoft’s Outlook will be distributed with Ericsson phones.

WAP, the technology that enables mobile phone users to access scaled-down content over the Internet, has been criticized for being slow and awkward to use, and other technologies are being developed.

“We are counting on a sizable share of the mobile Internet market which is under development,” Arvin said. “The value of the market in the near term is hard to quantify. But when we get into the third generation, it’s going to be very big.”