While it’s not true for all mobile applications, many services enabled by the mobile Internet are meant to be as close to the traditional Internet experience as possible. That’s where efficient and elegant device design and browser-power come in.

Sure, Microsoft announced plans last week for a new, mobile version of IE6, but it also only made an emulator of the forthcoming mobile browser available because the browser requires a more powerful handset–Redmond says IE6 needs new devices.

On the same note, Research In Motion is also ramping up its mobile Internet strategy with souped up devices like the Bold. Key partnerships like online social networking powerhouses like MySpace are only half the battle–the other challenge is keeping customers in your wheelhouse even after they discover the iPhone or Android’s G1.

As competition ramps up and clear choices between the top Internet-enabled devices become more difficult to sort out, the industry will increasingly look to side-by-side reviews of devices like those CNET and Gizmodo carried out this past week. As our weekly columnist and Rethink Research Director Caroline Gabriel points out in this week’s Special Report: CNET compared a half dozen handsets as they ran a full length movie, TV episode and audio track. The iPhone 3G, BlackBerry Bold, Samsung Instinct, LG Dare and HTC/T-Mobile G1 were all equipped with a 4Gb MicroSD except the 8Gb iPhone and all were running on 3G networks. According to the CNET review, the Bold blew away the competition on download speeds, performing at 13.9Mbps for the movie and 9.59Mbps for audio. The G1 came in second, with ratings of 5.99Mbps and 5.08Mbps; iPhone was third with 5Mbps and 2.79Mbps; the Dare performed at 1.49Mbps and 1.31Mbps; and the Instinct scored 0.79Mbps and 0.74Mbps. Read more here.

At the same time Gizmodo carried out a similar review with a very similar lineup of handsets–but the results were vastly different. Apple’s iPhone, Google’s Andorid G1 phone and the Blackberry Bold finished in the top three spots–but in that order. Read more here.

Finally, Google has given voice-enabled search another go on the mobile platform. Google’s voice search launched on Apple’s iPhone, though, not G1. Read this week’s Mobile Internet Watch to find out why.

More Industry News:

• Gizmodo grades 8 Handsets on Browsing: -A to F
• New handsets needed for Microsoft’s Mobile IE6
• T-Mobile USA increases data plan prices
• Clearwire shareholders approved planned WiMAX merger
• mHollywood: Nokia opens research lab in Tinseltown
• T-Mobile USA taps Yahoo for search

Handset makers are increasingly looking to advanced integration of popular web services with their devices, to enhance the user experience and differentiate themselves from more generic webphones. And this is putting even more pressure on the manufacturers to soup up the power of their products, to support applications like YouTube video at top speeds. In this race, smaller vendors are often scoring points ahead of the giants, with RIM and even Taiwan’s ASUS claiming performance breakthroughs this week.

On the integrated web apps front, Hutchison/3 has gone as far as to set up a subsidiary, INQ, to work with software organizations like Facebook and YouTube to create optimized handsets, and RIM is also turning to this approach to strengthen its nascent consumer strategy, which is based on making the smartphone into the hub for the user’s ‘four screen’ internet (cellphone, landphone, PC and television).

First off, the BlackBerry maker has worked with social networking giant MySpace on an integrated version of its software, which promises the same sort of instant-response, push-based service that is familiar to business users of BlackBerry email.

The MySpace system will push social content, supporting a full messaging interface, real time status and mood updates, camera integration and optimized photo management, plus notification of new MySpace events like message and friend requests. In addition, MySpace will launch a new community page for BlackBerry users, offering access to content, videos, games, ringtones, skins and related features.

RIM’s web services message should be reinforced by results of recent tests carried out by online laboratory CNET. This ran a full length movie, TV episode and audio track on five high end phones, the iPhone 3G, BlackBerry Bold, Samsung Instinct, LG Dare and HTC/T-Mobile G1. All were equipped with a 4Gb MicroSD except the 8Gb iPhone and all were running on 3G networks. The Bold blew away the competition on download speeds, performing at 13.9Mbps for the movie and 9.59Mbps for audio. The G1 came in second, with ratings of 5.99Mbps and 5.08Mbps; iPhone was third with 5Mbps and 2.79Mbps; the Dare performed at 1.49Mbps and 1.31Mbps; and the Instinct scored 0.79Mbps and 0.74Mbps.

Meanwhile, the Taiwanese device community is seeking to move into the branded, high performance market, in the footsteps of role model HTC. ASUS has shown off a smartphone, the P565, which it says has the most powerful processor at 800MHz - the average in high end handsets is 500MHz. The product also features the Glide touch-driven user interface and runs Windows Mobile, with the Office Mobile suite of apps. It is geared to business users.

This device epitomizes how far the Taiwanese manufacturers have come from their roots as makers of cheap, white label products for midmarket operators. HTC is now one of the highest profile smartpone makers, with its top range, the Windows-based Touch, selling under its own brand. Now ASUS covets the same move to brand loyalty and higher margins. Its P565 is equipped with a 2.8-inch VGA touchscreen, with HSDPA and Wi-Fi, plus a black leather case. Pricing has not yet been set.

By Joshua Martin, Senior Analyst, Yankee Group

How many times will that tired phrase grace news and blog headlines this week? Well, at least once and I’d venture to say quite a bit more as people wake up to realize the much ballyhooed Google mobile application update with voice search has finally launched.

Diminishing the need to key in searches manually (those small letter can be a killer), Google mobile provides location aware results for places nearby (with phone numbers one touch away), relevant websites, google images, and youtube videos. With the advent of universal voice search* (and really, can speech to e-mail be that far behind) will those married to their Blackberry’s finally be convinced to forgo that QWERTY?

Some of the reticent may buy iPhones, but by and large what the application will do is further cement Google as the search application for ALL iPhone users, and when you make money from advertising this is a good thing. Why would a user choose any other search tool until they offer something equal to or better than what Google has launched? Add in the aforementioned potential of voice to Gmail conversion (I’m hoping!) and suddenly more nails are being hammered into Yahoo’s coffin. Speaking of which, sorry to see you go Jerry. Rarely do we have a CEO with superpowers - no one had the ability to diminish shareholder value faster than you!

With rumors that Apple could be developing its own application for search, this is a shot across the bow for Google. No one will beat them on search. Not even Apple. There is one other factor to consider. This application demonstrates the power of a third party application but it is not fully integrated. Now, imagine how powerful voice search would be if it was baked into the operating system. Now if only Google had their own mobile operating system….

Could voice search be one of the killer apps for Android? Could Google have made the application available on the iPhone to demonstrate how great Android will be if and when such technology is incorporated into its very core? Only time will tell if Google will use such an application to build momentum for Android phones but in the interim they will simply have to be satisfied with further dominating search.

* A quick note that voice cannot be used to search contacts. Again, this is something that could potentially be addressed with an update but a feature I fully expect to be available when Google released voice search on Android.

What’s your take? Click here to leave a comment!

Microsoft’s mobile efforts are dominating headlines this week as Redmond attacks the mobile internet from multiple all fronts: browser, operating system and search.

First up, Redmond confirmed that a reworked version of Internet Explorer 6 will soon be coming to mobile phones. While the company promised to upgrade the mobile browser some time ago, it just released an emulator of IE6 for mobiles yesterday. While early reviews give the updated browser kudos on improved usability, the early-stage emulator version of the browser is not without hiccups. Check out this post from Arstechnica for more.

While Windows Mobile remains Microsoft’s most visible contribution to the mobile internet movement, reviewers have panned most of the devices running on the OS–until now. GigaOm gives SonyEricsson’s new Xperia handset a glowing review and ends with this advice: “If your company insists that you need a Windows Mobile phone, then Xperia X1 is an obvious (and perhaps the only) choice.” Ha. Read on for the entire review here.

Finally, Microsoft is grabbing headlines for nearing a deal with Verizon Wireless to handle the carrier’s mobile search offering. According to a Wall Street Journal report that cited unnamed sources, Verizon Wireless is close to accepting Redmond’s terms because the company will pay the carrier between $550 million and $650 million over five years as part of the deal. Reportedly, the figure is twice what Google was willing to pay Verizon Wireless. Read this week’s Mobile Internet Watch for more on this development.

More Industry News:

• Nielsen: 98% of iPhone subs use mobile data
• Sony’s Xperia gets good marks
• iSuppli determines T-Mobile USA’s G1 BOM is $150
• Japan’s DoCoMo buys $2.7B piece of Tata
• 3UK’s dirt cheap Facebook phone by INQ
• Twitter finally looks to monetize
• Loopt looking to cash in or cash out?
• Obama to put his “own stamp” on the FCC
• VZW releases BlackBerry Storm data prices
• iPhone over-the-air downloads on the way?

Last week we saw Microsoft seeking to resuscitate the ailing Windows Mobile with a far reaching partnership with LG. Now it is pushing to get more influential mobile allies into its clutches, and is trying to oust Google from a valuable search deal with Verizon Wireless. It has also finally confirmed that there will be an interim upgrade to its mobile OS, release 6.5, before the delayed version 7.0, in a bid to restore confidence in its platform.

According to reports in the Wall Street Journal, Microsoft is revisiting its old strategy of pushing its OS and web services by getting close to operators rather than device makers. In August, Google was close to a deal with Verizon Wireless to get its search bar included as the default on the number one US operator’s handsets, often gaining a coveted home screen position, which significantly boost mobile web usage.

Now Microsoft is reported to be trying to gazump its rival, by offering Verizon a larger share of advertising revenue from searches and a guarantee of higher payments. Sources say Microsoft would guarantee payments to the carrier of $550m-$650m over five years, or twice what Google was offering. Microsoft would not just gain profile for its web services, and its own share of ad revenue, but is also looking to include deals for Verizon to carry more Windows Mobile devices, and put the OS at the heart of its smartphone strategy.

The combined deals are valued at $1bn, but the importance to Microsoft goes far beyond simple cash. Verizon Wireless putting Windows at the top of its portfolio would be a huge endorsement for the flagging smartphone OS, and the US cellco must seem like ready prey - it is under pressure to accelerate its moves into mobile web services and into open access, but without the expertise, or strong partners, to do this without significant risk; and though it has expressed interest in Android, it has made no commitments to the OS. Meanwhile, until the LTE phase, it cannot choose the other main alternative to Windows Mobile for high end mobile web devices, Symbian, since this is hardly present on CDMA platforms.

The search market is also very strategic to Microsoft in its fight with Google, and it made its most aggressive move earlier this year with a (failed) bid for Yahoo. Now it may be forced to go a more indirect route - ironically, the one Yahoo has been pursuing strongly itself, of picking off cellcos one by one to default on its search engine - in order to boost its measly share of the nascent mobile search market. This currently stands at 5%, compared to Google’s 61% and Yahoo’s 18%. Google recently called off an advertising partnership plan with Yahoo amid fear of regulatory probes.

Google is the default search partner for Sprint Nextel, and Yahoo for AT&T, the latter deal also a blow to the search leader, and making a Verizon win essential for US profile. T-Mobile works closely with Google since launching the first Android phone, G1.

For Verizon’s part, it appears to be tempted by Microsoft’s offer, and this reflects the sort of bartering that will become endemic across the mobile web world, with Google, Nokia, Apple and Microsoft fighting for pole position with the large cellcos. These operators will remain the primary channel for mobile web services and devices for many years, despite the impact of open access and direct-to-consumer offerings, and battles like this one show their continuing ability to influence the structure of the mobile value chain, even as they resist the pressure to become mere bitpipes.

Another boost for Microsoft’s LiveSearch came last week when Sun agreed to distribute the MSN toolbar with its Java runtime, replacing a 2005 agreement to bundle Google’s toolbar (the change only applies, so far, to the US and to IE users). Bloggers speculated that the move was a tit-for-tat action, since Google recently dropped Sun’s StarOffice from its Google Pack. Microsoft is slated to launch the final ‘Wave 3′ release of its Live services this week.

Meanwhile, Windows Mobile 6.5, which has been long rumoured, appears to be a reality. Motorola co-CEO Sanjay Jha, a close Microsoft partner, blew the cover recently and hinted at the interim upgrade for the current release 6.1. Now Microsoft CEO Steve Ballmer has confirmed there will be a 6.5, and told last week’s WinHEC developer conference: “With releases we’ll make this year - releases we’ll make with 6.5 next year, Windows Mobile 7, I think we have a pretty interesting roadmap.”

A key focus for the step upgrade is likely to be a more streamlined user interface, with handset makers like Sony Ericsson and HTC already improving on the basic Windows capabilities, and some enhancements made by ODMs and carriers are likely to be implemented in the Windows Mobile 6.5 platform. Although Microsoft can be defensive about its technologies, it has become more flexible in the mobile world, as witnessed by its initial hostility to Sony Ericsson’s unique nine-pane user interface for its Xperia X1 Windows phone, which it later reversed. Also, Windows Mobile 6.1 included the homescreen design that was originally created for the T-Mobile Shadow by HTC.

Ballmer also let slip that Microsoft might adopt an open source browser engine in future. In answer to an audience question at a Power to Developers event, he said he believed Microsoft would still need its own browser for the foreseeable future, because proprietary extensions were still necessary to broaden its functionality. But he added: “Open source is interesting. Apple has embraced Webkit and we may look at that, but we will continue to build extensions for IE 8.”

Every time it seems that Microsoft might have abandon any hope of dominating the mobile software market, it bounces back with a new challenge to the wireless OS heavyweights, Symbian and Linux. This time, it has formed an alliance with top five handset maker and cutting edge webphone developer LG of Korea, and the pair will work closely on “converged mobile devices” from handsets to media players to netbooks, collaborating from R&D right through to sales and the creation of mobile web services.

The agreement is no more than a Memorandum of Understanding (MoU) at this stage, so could take two years or more to turn into products, but it points to some clear aspects of Microsoft’s strategy, even as it struggles to retain momentum for Windows Mobile and its web services offerings, at least outside its PC enterprise heartland. One, it has no intention of taking the ‘road most travelled’ and saving Windows by adopting open source. Two, it is belatedly severing the Wintel ties, which have kept it largely confined to Intel-based handsets such as the Touch range from its primary partner, HTC. Three, it accepts it is not best placed to create services and user interfaces for the converged mobile world itself, but needs more successful partners - a climbdown it also made when it allowed Sony Ericsson to design its own UI for its Windows handset, Xperia X1. Four, Windows Mobile and its associated software platforms are not going away.

On the surface, Microsoft gets the most out of this deal (though exact terms and any financial arrangements remain secret). LG is currently the most advanced of the top five in smartphone design and has huge insights into mobile web services and user experiences because of its home base in the world’s most advanced market in this respect, Korea. It has strong carrier partnerships and could drive Windows devices into CDMA, W-CDMA and even WiMAX networks, as well as via close ties with the consumer electronics channels. Microsoft, however, does bring its massive installed base - the PC side of which becomes more relevant as devices converge at the high end, forming the ‘mobile internet device’ hybrid category - and its global base of developers. And as the handset makers jostle for strategic position in pressurized markets, its steadily improving OS may prove a counterweight for Nokia rivals, to the huge influence the market leader will retain over Symbian, even as it goes into open source. Motorola has already chosen to back Android (and, secondarily, Windows) rather than Symbian, while Samsung and Sony Ericsson are taking multi-OS approaches. Yet if the companies were choosing on the basis of functionality and installed base, they would pick Symbian every time, so the desire to have greater control of their software partners, and not to let Nokia have everything its own way, are the main motivators. LG, too, may be hoping to leverage a close Microsoft alliance to ensure that there is competition in the smartphone OS sector, rather than one de facto standard under the wing of the Finnish giant.

LG Electronics’ CEO Yong Nam said, on signing the MOU with Microsoft chief Steve Ballmer: “This agreement between LG and Microsoft will create critical momentum in the industry. With this partnership, mobile computing will truly become an everyday reality, and LG and Microsoft will be at the forefront of it.”

Independent analyst Andy Seybold penned a column today over at FierceWireless entitled, “White Spaces Decision Will Haunt FCC” and a healthy discussion has erupted in the comments below. Seybold argues that the FCC’s decision to allow devices to make use of the unlicensed white spaces spectrum will result in ”thousands of people [finding] their ability to watch TV… compromised and their ability to hear what is happening at concerts… interrupted by interference caused by these new white space ’smart’ devices.”

One commenter writes in: “As a sound mixer who regularly relies on wireless microphones to bring all of you your television programming… Television Production, Sports, Conventions, Theaters, Stage, Churches… rely on hundreds of thousands of existing RF microphones… I think we are in for lots of bad sound and interferrence. Momentary splats, buzzes… constantly intruding into your life.”

Certainly an interesting read. Did the FCC rush to make a decision on this one or will white spaces prove to be fertile ground for future wireless start-ups and subsequent competition?

White white spaces remain controversial, it’s not too surprising that the economy had an impact on T-Mobile USA’s bottom line this past quarter (with a little help from AT&T Mobility, which reportedly snagged a few converts.) T-Mobile’s post-paid net additions were only 293,000 for the quarter an all-time low for the carrier.  

Finally, check out this week’s Mobile Internet Watch by Rethink Research’s Caroline Gabriel to find out how LG is teaming up with Microsoft to help Windows Mobile take on Symbian.

• Qualcomm, Amobee team for mobile ads
• Nokia launches web services for the emerging market
• CC: Green light for White Spaces
• AT&T offers GPS exercise app
• Amdocs to acquire ChangingWorlds
• Analyst: Mobile video infrastructure market to ramp up
• Analyst: 82M LBS social networking subs by 2013
• Analyst: White spaces decision will “haunt” FCC

Although 3 UK confirmed this week that it would offer Nokia’s Comes With Music unlimited downloads service, tied to its first touchscreen handset, in general the Finnish giant is having difficulties convincing its traditional cellco partners to support its range of Ovi web services, because of potential conflicts with the operators’ own brands and applications. But focusing too heavily on the dilemmas of the western European cellcos ignores a key element of Nokia’s ambitious strategy to reinvent itself as a mobile internet services giant - the focus on emerging markets. Thus the touchscreen musicphone, XpressMusic 5800 (previously codenamed Tube), and the N96 superphone, will be shipped first in emerging economies such as India, and will not reach some of Nokia’s European heartlands until after the holiday buying period. And now the world’s largest phonemaker has signed a highly significant deal with one of the most rapidly growing telcos in emerging economies, Egypt-based Orascom.

Orascom, which is expanding rapidly in its bid to create a multinational wireless super-carrier in the Middle East, Africa and Mediterranean, plans to offer Nokia’s Ovi portal and web services across its whole subscriber base. Included in the deal are Nokia Maps, Nokia N-Gage games and music applications. Orascom joins 3, Orange, Telefonica, T-Mobile, Telenor, TIM and Vodafone in supporting Ovi - they all offer some Nokia handsets that showcase at least some Ovi services on the homescreen, although the level of commitment varies between the various partners. Vodafone, for instance, has carefully segmented its target base for music downloads, offering Nokia Musicstore on high end smartphones and its own service for the midrange - but it has stopped short of the highly integrated Comes With Music, whose unlimited offer is a major challenge to other music options. And Orange and T-Mobile have stepped back from supporting Ovi too heavily in terms of homescreen support and branding, as they try to push their own portals, though the Nokia apps are available within their stores. There is no such ambivalence from Orascom. Like other major emerging market operators that Nokia is chasing, it is under intense pressure to spend its resources on expanding its networks and gaining customers and handset partners, leaving it little time or cash to develop its own internet services and portals, especially as its brands are generally immature at this stage. Yet internet services are even more vital in these rapidly growing markets than in developed environments. While carriers need to deliver low cost tariffs and devices for low income communities, they must balance those with high value offerings and customers - and tapping into the rapidly growing middle classes in markets like India and north Africa requires not just attractive, well priced phones, but the web and media services that all consumers crave. In many cases, where there is limited wireline broadband build-out, the wireless device will be the main way for these newly affluent users to get online, creating a huge opportunity for carriers to become the primary broadband as well as mobile provider - as long as they can offer attractive, usable and well priced web and content. Such partnerships, then, are ideal to drive Nokia’s devices, with their increasingly tightly integrated applications, into new user bases which, while they may have lower average income than their western equivalents, are increasing their telecoms and internet spend at a faster rate, with most of this potentially going to a strong wireless operator and its applications partner. Orascom and its affiliates control almost 100m mobile connections worldwide, as of the second quarter of this year, mainly based on GSM/EDGE, but with rapid expansion of 3G and WiMAX too. The group has operations as far afield as Algeria, Pakistan, Egypt, Tunisia, Bangladesh and Zimbabwe, and has expressed the intention of launching in Canada (where it is part of the Globalive group, which acquired AWS spectrum recently) and North Korea (where it acquired a 25-year license in one of the world’s last remaining untapped markets). However, the company pulled out of a partnership with Hutchison Telecom’s emerging markets group when the Hong Kong giant sold its share of its Indian joint venture to Vodafone, and Orascom is still on the look-out for a way into India. Orascom, headed by Naguib Nawiris, saw its market capitalization increase from $340m in 2003 to about $16bn in mid-2008.

Many cellcos are focusing on social networking as a likely route to win more subscribers and boost their mobile internet usage. Since the popular application is particularly suited to mobile devices, as it can be integrated with location and presence facilities, it is expected to be the biggest driver of consumer mobile web services in the coming year, after email and search. Small would-be disruptive players and established giants are all trying to get in on the act, with Telefonica and Hutchison subsidiary INQ the latest to show their hands.

A small part of the Hutchison Whampoa empire is seeking to ride the social networking wave, expanding on the model of offering simple phones focused on a key integrated application - as pioneered by 3 UK with its Skype phone (see separate item). INQ, a new subsidiary being officially launched this week, is focusing on low end handsets that come with certain key web and messaging applications pre-installed. The aim is to appeal to the rising number of people, especially in the teenage market, who want to make more use of the mobile internet, but who have limited budgets and are looking for an easy-to-use experience. Just as Hutchison’s 3 operations are looking to harness the open internet business model on their wireless networks, rather than sticking to cellco-specific services and profit streams, so INQ will do the same from the device point of view, looking to open access, low-subsidy, web-optimized phones for the mass market.

The devices will launch first via 3 UK and Australia and will integrate several services but will be particularly focused on social networking, via the Facebook offering. It will also pre-install eBay, MSN, Skype and others, with quick links from the simple home screen. The innovative user interface, driven by simplicity and multitasking rather than the highly complex designs of true smartphones, was built on the Qualcomm Brew platform, which underpins a range of web-optimized environments, most notably Alltel’s. The INQ project is another breakthrough for Brew and its user interface system, UIone, in the GSM/HSPA world - Qualcomm has been using Brew to try to expand its reach beyond its traditional CDMA market, and the software is no longer tightly tied to that network. UIone is also used by O2.

“We’ve built a multitasking environment on top of the Brew platform. Basically you just log into Facebook and the client goes out and fetches all your contacts, punches them into the phone, and asks if you’d like to integrate some or all of your contacts with the address book. It’s the same thing with Skype and MSN,” said Frank Meehan, INQ’s CEO. This offers a good halfway house between an entirely siloed Facebook device and an unfettered web experience, which can still be confusing and hard to use for many non-enthusiasts. The contact list acts as the foundation for the whole range of apps including email and messaging.

The devices also aim to support modern mobile internet models by being sufficiently low cost to need little operator subsidy. They should retail for about £100. After the UK and Australia, Meehan says about six other markets will follow by mid-2009. Although 3 operations are the most likely initial partners, INQ wants to target a wider base than its sister companies and is aiming for a US launch, though it does not expect a US carrier deal until at least the middle of next year.

Meanwhile, Telefonica is the latest tier one operator to try to seize the initiative and put itself in the center of the mobile social networking world, creating an international Facebook community in all its territories. The Spanish multinational is following a lead set by T-Mobile, which was the first major to launch an integrated dashboard covering many social networking programs, as part of its Web ‘n’ Walk offering. Telefonica is extending a deal it pioneered through its UK arm O2, allowing access to Facebook from any of its networks worldwide.

The expanded agreement calls for a phased roll-out of the new services, with the first stage O2’s operations in Ireland and Germany; Telefonica’s homeland of Spain; and some of its Latin American territories - Brazil, Mexico, Argentina, Chile and Colombia. The second phase will include Venezuela, Peru, Ecuador, Central American countries, the Czech Republic and Slovakia.

Every participating country can include a link in the browsing menu of its handsets to Facebook’s mobile service, allowing customers to send photos and videos through integrated MMS services. Currently, more than 24m pictures are uploaded to Facebook each day and the service has 100m registered users. Telefonica has 171m mobile subscribers worldwide, a base that could create a major social networking community.

According to ABI Research, 46% of users of online social networks are accessing these from their handsets on at least some occasions. MySpace and Facebook were the destinations of choice, claiming 70% and 67% of mobile social networkers respectively; no other site reached 15% adoption. This may bode ill for companies like Nokia, which claim they can create a mobile optimized social networking experience that will outdo the big PC brands.

This year has been full of buzz around vendor software stores, such as Apple App Store and Google’s planned Android Market, which aim to promote a certain platform to users and developers. Now RIM is joining the race, with plans for a BlackBerry Application Center, but it will enter a crowded space. Some operators, like T-Mobile, are beefing up their own stores, aiming to regain the initiative by offering apps for any operating systems and devices they support. But the multiplatform store is already a well established reality, and could provide another valuable channel for developers. The interesting question is whether the likes of Apple will see them as a useful way to expand the market, or a rival to their own brands and revenue split arrangements.

RIM trades heavily on its long experience in supporting personalized apps that are tightly integrated with the handset (unfashionable in the open access era perhaps, but delivering a strong user experience, plus being highly efficient for the carrier network). Following the success of the integrated BlackBerry FaceBook app, which has been downloaded 2.5m times in the past year, RIM is taking a similar approach with fellow social networking giant MySpace, with Microsoft Live Search, ticketing service TicketMaster, and the TiVO digital video recorder system (allowing the BlackBerry to act as a remote control and for TV programming to be pushed to the user over the cellular network).

RIM co-CEO Jim Balsillie claimed recently that the company’s its experience with push email puts it in an ideal position to deliver more consumer-focused, web 2.0 services that rely on personalization and are driven by events or location, rather than browser-based. Talking of social networking, Balsillie said: “It is remarkable when this is in a push, connected, event-driven basis. When you change your access to information, you change your relationship to it - not incrementally but on a quantum basis. These changes are tremendously exciting.”

So it is logical that RIM’s next move would be to open a software store, and the company this week confirmed leaks that it was readying a BlackBerry Application Center to run on the Storm, with its updated operating system, BlackBerry 4.7. This will enable users to discover, browse and install third party BlackBerry apps hosted by mobile operators, serving as the primary interface between the consumer and the carrier’s directory of downloadable software. This highlights a significant difference between RIM’s approach and Apple’s - while Apple retains full control of the store, and insists on the upper hand in carrier relationships (an upper hand it will only retain if its devices keep driving ARPU and customer acquisition), RIM is pursuing its traditional path of being the carrier’s friend, optimizing its handsets and now its store to boost the cellco’s own business model. The new Application Center should make it easier for RIM users to access and download software, stimulating data usage, but this will remain entirely within the carrier’s emvironment. The Center promises one-click, browser-based installation andusers will only see applications available for their specific device model and OS version, with full descriptions and alerts when updates become available. Carriers will assume responsibility for hosting application data and sending updates to a RIM-hosted server back end - an approach also favored by Nokia, in its bid to get carriers on the side of its software and web services strategy.

The rising resentment of the controlling approach of Apple (and, operators fear, Nokia, once it gets more established in software) should boost the multiplatform download stores. One of the strongest of these, Handango, will start to offer Android apps from November. This will complement Android Market, at least in the early stages, when Google’s own store will not support paid software.

Handango believes it can attract Android developers and consumers. “We have many loyal customers that we expect will want to try the Android device but are comfortable purchasing from Handango,” said CEO Bill Stone in an interview. “What is interesting and exciting for us is that we can offer customers and developers the choice of free and paid applications at launch as well as the ability to purchase them via the web and then download to their device.”

The company’s first partner is games publisher EA Mobile, which has said it will stay away from Android Market until it can charge for software.

Within Handango, members can add Android apps directly to their developer accounts and choose to distribute them in any of three ways - give them away for free; sell for a one-time purchase fee; or set up a monthly, quarterly, or yearly subscription fee.

Google has given no date for including paid content in Android Market, though it has said that it would not take a revenue cut, as its main goal is to stimulate uptake of Android devices, and it wants to differentiate from Apple, which takes a 30% share of revenues generated through App Store.

Meanwhile, other third parties are trying to cash in on the vogue for device-driven applications stores. Last month, mobile content provider MobiHand announced a partnership with RIM enthusiast site CrackBerry.com to launch their own on-device storefront for the BlackBerry line. The digital retail portal enables consumers to browse and search thousands of applications optimized for their particular RIM device, and will integrate with the BlackBerry Wallet m-commerce service for purchasing.