Reinventing the Conversation

April 30, 2007

By Sarah Pierce

Who: Jack Dorsey, 30
What:, a global community of users who stay connected through instant messaging, texting and online posting
Where: Based in San Francisco

It was only a matter of time before those pesky things called “conversations” became obsolete. Anyone with a cell phone or personal computer has experienced the subtle social shift taking place in the way people communicate. Commit to a three-minute phone conversation? No way; send a text instead. Wait for your friend to check his e-mail? Better not waste your time; an instant message is easier. In this technology-driven era, people are constantly looking for the fastest, easiest way to communicate, and anyone who’s smart enough to recognize this movement would be wise to capitalize on it now.

Like all good entrepreneurs, Jack Dorsey had his finger on the pulse of pop culture when he started working on in March 2006. Unsatisfied with his job at a podcasting company, Dorsey began looking into the mobile phone industry, which he felt was becoming huge. “I’ve always been fascinated by IM–letting people know when I’m at lunch or at work,” he says. “I wanted to set up a way to receive messages about what my friends were doing no matter where they were.”

With help from some co-workers, Dorsey began working on as a side project, officially launching the site in August 2006. Twitter is a global community that keeps users in constant contact with one another through texting, IM or their personal Twitter pages. Anyone connected to you as a friend instantly receives your messages. This is no MySpace or FaceBook, though; don’t expect to see a lot of pictures or blog entries. The site instead is a simple way to quickly let your friends know exactly what you’re doing or thinking at any given moment. Typical messages range from mundane updates, such as “at work. working on: email,” to random thoughts: “my emotional homework for the week: clean out my glove compartment, then go the arcade and spend $3-$5.”

With no startup money invested, Dorsey has relied solely on word of mouth to get his site going. So Twitter was slow to get going for the first couple months. “Bloggers were the early adopters to push it, and from there it was a matter of them forcing their friends to join,” says Dorsey.

Twitter caught its first big break when it helped sponsor the South by Southwest Conference in Austin, Texas in March 2007. The popular music and media conference has become a favored gathering among bloggers and other tech-lovers, making it a target audience for Twitter. Knowing that the majority of his users are bloggers, Dorsey set up two plasma screens displaying real-time twitters between conference attendees–and they were hooked. Since the conference, the number of users, updates and messages has doubled.

“The response to Twitter has been amazing,” says Dorsey, who admits he’s currently not receiving any income for his “side project.” “We’ve had some interest from cell phone companies in helping us cover some of the expenses, but my main goal right now is purely on growth. For a company like this, that’s doing something no one has ever done, growing is the most important thing.”

Site of the Week: All Things Digital

April 30, 2007

Walt Mossberg’s new digital site offers a lot of potential for engaging content, but it’s still suffering growing pains.

Good variety of engaging and informative columns. Expert guest columnists. Nice site design.

Much of site’s content is recycled from print. Single-sponsor advertising. Some layout flaws.

The Wall Street Journal

By Jim Louderback

The Wall Street Journal‘s Walt Mossberg is often called the “the Pope” of the tech press, and with the new All Things Digital site (, he’s aiming to conquer the Web as well. Mossberg, along with conference partner Kara Swisher, reviewing partner Katherine Boehert, ex-San Jose Mercury reporter senior editor John Paczkowski, and financial backing from The Wall Street Journal, seems to be aiming to create the tech version of The Huffington Post.

Built with WordPress, the elegantly designed site delivers a combination of commentary, news analysis, product reviews, and video. Instead of following the FIFO model of a traditional blog or the multistory approach of other content sites like CNN and The Wall Street Journal, the site plays up its editors’ reputation and personality. It delivers a mix of new and old features that appeal to Mossberg fans and to attendees of Swisher and Mossberg’s popular and exclusive executive conference, which shares the site’s name.

Those unfamiliar with Mossberg, however, will be somewhat confused upon first arriving. The site doesn’t clearly state its mission up front; it offers only the cryptic statement, “It’s tech-tastic.” If you don’t know Mossberg or Swisher, the site seems to be saying, then there’s no reason for you to stick around. You’ll have to root around down in the footer to discover a longer description of the site, which leads to the About Us page.

Those who do stick around will be pleased by the mix of content. Swisher has revived her “Boomtown” column, which ran in the print version of the WSJ during the tech-boom years. It’s a tad overwritten and echoes the “Open Letter” format that Stewart Alsop used so effectively in the Agenda days, but it’s a fun read, and I’m glad it’s back.

Another greatest hit from the days of the Web bubble, “Good Morning Silicon Valley,” has sort of returned via Paczkowski, one of its writers. His “Digital Daily” section is essentially a blog, featuring snappy and snarky commentary on the news of the day, along with a daily video that hopefully will improve over time.

So far, Mossberg’s contributions are limited to Web versions of his WSJ stories and a somewhat Spartan blog, called Mossblog (a great name—but since he doesn’t own the URL, it resolves to a subdomain of His posting about Apple’s “craplet video,” which debuted a few days after his column, bemoaning all the bloated apps that show up on today’s Microsoft Windows machines, was a little too self-serving and congratulatory. But his latest post, taking the Mac faithful to task for freaking out over the Leopard delay, was clear, pointed, and right-on.

The site also features prominent guest bloggers, much as The Huffington Post does. The first, by AMD CEO Hector Ruiz, talks about how Metcalfe’s Law ought to be a stronger guiding principle in semiconductor design than Moore’s Law. It’s not the easiest read, and it mostly parrots AMD’s company line, but it’s worthwhile nonetheless. Mossberg and Swisher promise that these guest blogs will be written by the guests themselves—not by PR professionals. That’s a breath of fresh air.

Visit the site

Harnessing Social Networks

April 23, 2007

Just when you thought you and your business were getting the Web down cold, social networking has come along to confuse matters. After a decade of exposure to the Internet, mom-and-pop businesses and international giants alike have learned to make effective use of the Web. Now they need to figure out new strategies as the Web morphs from a mainly one-way method of communicating with customers to a free-for-all of user-created content.

Many of the companies reaching out to the teens and twentysomethings who populate MySpace have built their pages on that service, owned by News Corp. (NWS ) The page for American Eagle Outfitters (AEO ), for example, is mostly an ad for the youth-oriented clothing chain, but it also features discussion forums that cover topics from fashion to store employment. The company has 36,000 MySpace “friends.” Some businesses also post videos on YouTube (GOOG ); Hewlett-Packard (HPQ ) is sponsoring a contest for the best video featuring an HP calculator.

One of the odder places attracting business interest is Linden Labs’ Second Life, a virtual world where avatars—3D cartoon representations of players—live, love, and try to get rich. IBM (IBM ) has built a replica of its Almaden Research Center in Second Life, and Coldwell Banker has opened a virtual office to sell virtual real estate. But for all the buzz, it’s not clear to me that Second Life is much of a business investment. Linden Labs claims 5.2 million “residents,” but only 1.6 million have logged on in the past two months, and there are generally fewer than 50,000 around at any one time.

A STARTUP CALLED NING, backed by former Netscape Communications honcho Marc Andreessen, may be a better bet for small-to-midsize businesses that want to get into the social-networking game without making a huge commitment of either time or money. Ning is a hosting service and a set of tools that let any individual or organization—a soccer team, a church choir, or a business—create its own social network.

Using Ning to set up your network requires a bit of skill: It’s much like creating a Web page. But once you’re up, adding videos or a photo gallery to the design is simple. And Ning offers all the standard tools of the social-networking trade: discussion forums, blogs, and lists of “popular members.”

A basic Ning account is free, but “free” comes with some features you may not want and will have to pay to get rid of. The most significant is that Ning runs ads by Google (GOOG ) down the right side of the page. You not only get no revenue from the ads being run on your site but also risk the chance that the text spots, linked thematically by Google magic to the content on the page, might contain something you’ll consider offensive—or even promote a competitor’s business.

For $19.95 a month you can replace Ning’s ads with your own ad service or lose the ads altogether. Another $4.95 a month lets you change the address of the network from “” to “” And $7.95 a month more removes a link that lets members of your networks create networks of their own, which could include an “I hate your business” network.

Taking the plunge into social networking raises challenges for any business. When you let customers or prospective customers participate, you have to pay close attention to what they’re saying. You are going to get negative and sometimes ugly comments (BW—Apr. 16), but you have to accept this as part of the culture of the Web.

The upside is that building a social network around your business can not only give you a richer way to communicate with customers but also a golden opportunity to learn what they’re thinking. That can make it well worth the effort.


Site of the Week: LinkedIn

April 23, 2007

LinkedIn is by far the most developed business- and career-oriented networking site and service out there; it’s the way millions of career-minded people will find their next jobs.

An efficient way to connect with an enormous reservoir of professionals from just about every industry. Easy-to-use search and filtering features. Lets you create a detailed professional profile others can search.

Dense, busy interface. May encounter promiscuous linkers.

LinkedIn Corporation

The Web is teeming with social-networking sites that emphasize the “social,” but what if you’re a business-minded individual more interested in the networking end? Where do you go? The answer: LinkedIn. Since PC Mag‘s first serious look at the beta three years ago, the site has swelled to over 9 million registered users and become the most feature-rich business networking service of its kind.

I’m tempted to say it’s not only feature-rich, but feature-heavy. The sheer mass of capabilities takes a toll on the site’s looks—the interface is busy in the extreme. That all should change soon, however, as the company says a design refresh is coming in the next month or two. Though I’ve seen only one page of the redesign (it’s in our slideshow)

The service helps you make the most of your current professional relationships by letting you link with your closest work contacts, and that, in turn, can give you access to their contacts. I say “can” because you don’t automatically get to connect with everyone under the sun; part of the beauty and tantalizing nature of LinkedIn is that you get to see more than you directly have access to. While you can see the basics about people who are linked to one of your direct connections, you must first get an introduction, a referral from your direct connection vouching for you, before you can connect with them directly.

When you register, the site uses the information you enter to start your personal profile —basically an expanded curriculum vitae. You can (and should) add to it, though; you do this via a form that combines question-and-answer format with free-text entry. The quality of your profile heavily influences the results you get. The more fleshed-out it is the better, since members can search the site for others who have similar backgrounds, attended particular schools, have certain professional experience, worked at a particular company, and more. The rich detail that profiles can contain increases the chances of a search turning up people who can provide expertise and even career opportunities, often in industries far different from yours.

New LinkedIn Features

I find the features added since we last reviewed LinkedIn among the site’s most appealing and powerful. The Jobs/Hiring section powered by SimplyHired tops my list. Tools you access via the Find jobs tab in this section let you search for opportunities based on keywords that describe the type of position you want, and you can narrow your search geographically. Positions available through people in your network appear first in the results. Those who have jobs use the site to search for candidates or advertise openings (one of the main revenue streams for LinkedIn).

Another recently added (and highly useful) capability, LinkedIn Answers, gives you a great way to build your network without really trying. Questions you post go directly to the inboxes of contacts within three degrees of connection to you (you know someone who knows someone who knows them), and others can find your questions on the Answers pages. The tool should let you get valuable input without all the chatter and garbage that collects on sites such as Yahoo! Answers. I recently asked what PC Magazine‘s next Site of the Week should be, and within an hour, I had 4 solid responses; in three days, I’d received 13.

Another new feature, available within LinkedIn and from toolbars for Internet Explorer and Firefox, lets you upload your e-mail contacts from AOL, Gmail, Hotmail, and Yahoo! Mail. A Microsoft Outlook toolbar lets you upload its contacts also. For now, users of other software, such as the Palm desktop OS, will have to export their contacts to a webmail service, then upload them to LinkedIn. After I shipped 752 contacts to LinkedIn, the service told me that 259 of them were already using it. Not bad.

The new Reference search, which you reach via the People menu tab,) gives you a good way to find out about potential employees, employers, and business partners. Enter a company name and the years a person worked there, and you’ll be able to cross-reference this information with matches from your own network.

LinkedIn Lowlifes

Unfortunately, the free and open nature of LinkedIn, along with its search capabilities, can lead to abuse by what some call promiscuous linkers, people who compete to see who can build the largest networks. PC Magazine ran a column about the problem two years ago, in fact. Promiscuous linkers don’t really know you or even strongly connect to you with a single degree of separation, but they try to flatter and cajole you into adding them as direct connections, expanding their networks.

By failing to question whether warm and cold callers have strong connections to them, many kind-hearted members have inadvertently fostered this problem. Some shady operators even pretend they’ve met you or have some other connection. LinkedIn has built defenses against this sort of thing—for example, you can request that a mutual connection send a referral to you—but they still depend on honesty.

LinkedIn lets you easily report people you believe to be abusing it; the service will flag them and can limit their ability to send link invitations. Those squeamish about declining an invitation out-right can click on Decide later, so the other party won’t receive a notification of your rejection. And, of course, you can remove a connection if you think you made a mistake; the person won’t get a notification of that.

Various Versions

The free version of LinkedIn gives you an unlimited number of invitations from others to connect; you are also able to have five open invitations sent out at a time. You can receive InMails as a free member as well. InMails, as the name might suggest, are internal e-mails sent by premium members as a way to connect to any type of LinkedIn member directly.

There are also several LinkedIn premium packages: Business, for $19.95 monthly or $199.50 yearly; Business Plus, at $50 or $500; and Pro, which costs $200 or $2,000. The key differences among the levels are how much ability you get to perform searches beyond your own connections and network, and the InMail feature, which lets you directly contact other users from within the service. You can also purchase some features à la carte—if, for example, you want to contact someone not in your network, you can buy an individual InMail for $10.

Business class members can send 3 InMails per month, Plus users get up to 10, and Pro users up to 50. Similarly, premium accounts give you a wider net for search results as well. For instance, Business users are provided 100 results beyond those in their own network when they perform a search for something (names are not included, just a profile summary, you’d then use an InMail to make direct contact). Plus users get 150 additional results and Pro users 200.

Other important premium features include one-business-day customer support, unlimited reference searches, and OpenLink Network membership. These features would be of most benefit to hiring managers, recruiters, or companies doing a lot of hiring.

Does LinkedIn have competition? Yes and no. Ryze shares the ability to network with others, but has a much smaller user base (around 300,000) and fewer other options. Career Builder, HotJobs, and Monster compete in job-search capabilities, but lack the networking features. The major search engines compete on general searches for people, but the results lack the detail you get from LinkedIn. No other site or service provides everything under one umbrella.

Visit LinkedIn
See slide show

LinkedIn (beta)

More of a well-heeled social club than a friendly free-for-all, LinkedIn is the most exclusive site we reviewed. This professional-oriented site is also the least likely to bother members with trivia. Like Ryze, LinkedIn targets business users, but at a higher level—meaning upper-echelon managers and executives.

A quick search of LinkedIn’s 40,000 members revealed over 700 VPs, over 140 CTOs, and over 500 CEOs; such stats might cause executive recruiters—or job seekers—to prick up their ears. If LinkedIn can maintain its cachet of exclusivity, it’ll be an impressive way to make important contacts for those in senior positions.

Mere mortals, however, aren’t likely to see this high-level A-list—at least not without a custom invitation from on high. LinkedIn’s stringent privacy policy is appropriate to its professional bent. The site does a good job of protecting its clients from public view, though you can opt to allow other users to contact you directly.

A more common option for beginners is to search for current and former colleagues and contacts already linked up to LinkedIn. A handy feature lets you compare your Outlook address book against a list of current members, expediting the process of inviting people from the outside and building your business network from the ground up.

LinkedIn has a no-nonsense, all-business user interface. There are no forums, specific listings for job opportunities, or extra content here (as with Ryze and beyond statistics about your network, including percentages of users who fall into categories (like job seekers and hiring managers) and distribution by industry and geography.

LinkedIn gives you excellent control of searches by name, title, geography, and industry type. You’ll see only people in your network (those you’re linked to by a chain of friends), however, so it’s important that you cultivate connections. Once you locate a source, you can approach contacts about a job or other opportunity via a request page. In this beta version, users can have three outstanding requests at a time.

The governing principle is that persons of influence will be selective about passing along references, which are handed off to other contacts for approval. For three degrees of separation, you need two people to approve your request to approach a potential employer with a rèsumè, for example. When you sign in to your account, you’re informed of outstanding reference requests, which you can accept or reject. Should a request be rejected, the person who asked for it is never informed who rejected it. This decreases the chances that inappropriate requests will be simply rubber-stamped.

While there are no profile photos for LinkedIn members, testimonials in the form of endorsements from other members can add weight to user profiles. According to LinkedIn, such endorsements significantly increase the odds of making successful contacts. Favorite contacts can be stored in an address book, though unlike the other services, LinkedIn doesn’t have an extensive messaging system.

LinkedIn could change the way executive recruiting is conducted. As a general-purpose job site, it can undoubtedly work. And if you’re fortunate enough to gain entrèe to its elite client list, it’s a great resource for tapping venture capital, senior management, and technical expertise.

Turn Sales Prospects Into Regular Customers

April 16, 2007

By Richard Morochove

Sales are the key ingredient in the mix that creates a successful business. You need customers to buy your products and services or you don’t have a viable operation.

How can you convert more prospects to buyers, or first-time buyers into regular customers? Those are the aims of customer relationship management, widely known as CRM.

CRM Organizes Sales

CRM applications handle three main tasks: Track your prospects and customers; keep tabs on what they want; and let them know how your business can deliver the goods that satisfy their needs. In a nutshell, CRM organizes the sales process.

Many small businesses still use a spreadsheet, a generic database, or a general-purpose application such as Microsoft Outlook to keep track of contacts and prospective customers. But using a specialized CRM app can make it easier to achieve your sales objectives.

CRM applications evolved from early contact managers, the digital equivalent of the paper address book or Rolodex. But they can do much more, such as keeping track of what tasks you must perform to keep a customer happy, or performing simple project management that coordinates pre-sales work among different employees.

Highrise: A New Web-based CRM Service

If your business is new to CRM, Highrise could be just what you need to dip a toe into the waters. Highrise is a recently released Web-based service from 37signals, which is probably best known for its Basecamp collaborative project management service.

Highrise is relatively inexpensive (business plans start at $24 per month), and simple to set up and use. It’s especially well-suited for a far-flung virtual organization of few dozen or so people, since it lets you easily share information with other authorized users.

Simple but Effective CRM

Highrise’s virtue lies in its simplicity. You can enter contact information directly using your Web browser or import existing contact records in the popular vCard (.vcf) format, which many e-mail applications and contact managers use.

You can create new tasks, set deadlines, and assign tasks to categories. Establishing a case lets you bring together related contacts and tasks as a form of basic project management.

When you log in to the service, the Highrise dashboard displays recent activity and upcoming tasks. You can choose to have a daily task summary e-mail sent at 6 a.m. reminding you what you need to accomplish that day. (You can also opt for individual task reminders, but the summary list of all tasks due either goes out at 6 a.m. or not at all.)

Good Use of E-Mail Integration

I especially like the way Highrise uses nothing fancier than plain old e-mail to jump through a few hoops and perform some neat information integration tricks. You can forward e-mail messages to special user-related Highrise e-mail accounts, which then automatically assign those messages as new tasks or attach them to a contact.

If you already have CRM software and don’t find it to be overkill, Highrise probably isn’t for you. It’s best suited for neophytes, and it lacks the capabilities and integrated hooks into other business processes that larger, enterprise-scale organizations get from higher-end CRM services such as and NetSuite. However, Highrise officials say that an API (application programming interface) offering more integration possibilities is in the works.

You can check out Highrise by signing up for its free plan, which is limited to two users and 250 contacts, and provides no online storage. Paid plans range from Basic to Max. Basic costs $24 per month, permits six users and 5000 contacts, and includes 500MB of online storage. Max allows an unlimited number of users and 50,000 contacts, provides 50GB storage, and costs $149 per month. All paid plans offer a 30-day free trial.


First Look: Ning, Nexo Let You Make a Social Network

April 13, 2007

by Edward N. Albro, PC World

Now that sites like MySpace and Facebook have popularized social networking via the Web, some people want to start their own network, away from the spam and adolescent silliness that can accompany the big sites. Ning and Nexo’s eponymous, competing services stand ready to make that happen: Both let anyone create, for free, a site for their bowling club, theater company, or other group. I liked the level of creative control in Ning more than that in Nexo.

In many ways, Ning and Nexo aren’t that different from services like Homestead, which for years have helped people create personal Web pages. Both services offer you a variety of design templates and let you point and click to add elements to the page (no need to download an application, as site creation is entirely Web-based). And both will provide you with a URL within their domain.

The difference from personal pages of a few years back is in the kinds of elements you can choose to add to your Web page. Both Ning and Nexo let you put blogs, discussion forums, and video modules on your site so visitors can interact with you–and with one another.

Make Your Site Your Way

I found both services easy to use: If you have all the materials you need (photos, logos, and such), you can easily have your site up in a half hour.

I prefer the look of Ning’s templates and the basic organization of the sites it creates. And if you know what you’re doing, Ning allows an almost infinite capability to tweak your site. Co-founded by Netscape pioneer Marc Andreessen, Ning is a tweaker’s paradise. You can easily change everything from the font used for body text to the background color of the title bar. And if you know CSS, the editing possibilities are endless. Ning has also opened the site’s source code, so programmers can build small applications to perform whatever function they need and embed them on sites. Largely spoiling the look of free Ning sites, however, are the Google text ads that take up most of one of the four columns on the page. You can remove ads from a Ning site for $20 a month.

Nexo, which was in a public beta when I tested it, doesn’t allow as much flexibility as Ning. But for now Nexo has one great advantage: No ads appear on your site. Nexo CEO Craig Jorasch says the company plans to include ads on most pages, probably in the last quarter of this year. You’ll be able to pay a nominal monthly fee to remove ads, but at the time of this writing Jorasch didn’t know what that fee would be.

In my testing, I found Nexo certainly flexible enough to satisfy the needs of most people, though it doesn’t provide all the tweaking options that Ning does. On the other hand, it does have more preprogrammed modules, from a widget that lets you show product information pulled from to an applet that lets you post a one-question poll. I don’t like the default organization of Nexo sites, though: The first page of the site shows just a boring list of the site’s pages, and visitors must click deeper to see much of the actual content.

Ning’s blog and forum creation tools are bit more sophisticated than those in Nexo. With Ning, you can thread forum posts, something you can’t do with Nexo. And the formatting of Ning’s blog entries simply makes them look a bit more substantial.

If you need a Web site that’s heavily customized, and you have the skills to make the changes, Ning is a great choice. But if all you want is a simple site, you should go with Nexo, especially while it’s ad-free.


Beta site; not rated
Service lets you easily set up a Web page with lots of widget options and no ads–for now.
Price when reviewed: Free


Highly customizable service creates attractive Web communities, but ads mar the looks.
Price when reviewed: Free ($20 per month without ads)

Mobile Telcos Rush to Social Networking

April 2, 2007

As the social networking phenomenon continues to gather pace, mobile-phone providers are champing at the bit to become members of the club. On Mar. 28, France Telecom’s (FTE) Orange UK mobile arm said it would begin offering its customers access to social networking site Bebo this summer.

The exclusive deal comes hot on the heels of Vodafone’s (VOD) announcement in February that the world’s largest mobile carrier had struck deals to cooperate with News Corp.’s (NWS) MySpace social networking site and Google’s (GOOG) YouTube video-sharing site, giving users access to their MySpace pages and allowing them to upload clips to YouTube from their handsets (see, 2/13/07, “Vodafone and MySpace Connect to Conquer”).

New York-based Verizon Wireless, in which Vodafone shares ownership with Verizon Communications (VZ), also has teamed up with YouTube in the U.S. to offer access to the site’s most popular clips there.

The Mobile Is “Personal”

It’s easy to grasp why there’s a land grab afoot. In February alone, some 403.3 million unique visitors worldwide visited online community sites, according to researcher ComScore. The figure is growing at an annual clip of about 30%. With mobile phones already the hub of most people’s social networks, the combination of the two seems like a natural.

“The mobile device is much better suited because it’s very personal,” says Falk Müller-Veerse, managing partner at Munich’s Cartagena Capital. “There’s nothing more annoying than giving your PC to your nephew, getting it back, and finding that you are suddenly conversing with his friends.”

Consumers seem to be ready. In a Gartner survey conducted in mid-2006, 35% of U.S. mobile users said they would be “extremely interested” in using their phone to submit text, pictures, video, or audio content to a blog. In Britain, 10% voiced similar enthusiasm, as did 12% of those polled in Italy.

The Killer App?

The appeal is understandable. Social networking is to some extent about “information snacking,” or checking friends’ pages to see what they’re up to, says Nick Jones, vice-president at Gartner in Egham, Britain. Figures from researcher Nielsen/Netratings (NTRT) confirm that the average MySpace or Bebo user spends less than 30 seconds on each page when visiting the sites. In that sense, social networking is ideally suited to mobile phones because consumers can check in while waiting for a bus, for example.

At the same time, social networking could be a “killer application” that encourages so-far-reluctant consumers to use their phones more for wireless data services. The infrastructure is in place: In Europe, “third-generation” wireless networks and handsets that offer zippy connections are now mainstream, while in the U.S., carriers are upgrading their networks now for the same capabilities.

The danger for carriers: They may not reap significant incremental revenue, as stiff price competition and aggressive bundling drive down the price of wireless data access. Plus, analysts say, mobile operators—like wired Internet service providers before them —run the risk of being little more than conduits for user-generated content and information.

Exclusive Arrangements

What’s more, it’s likely to take three to four years before social networking via mobile phones becomes mainstream, notes Cartagena’s Müller-Veerse. For one thing, the current quality of user interfaces on many phones could discourage mass adoption. It’s also cumbersome to have to download software to connect with a mobile networking community—and even then, users may run into technical glitches.

Vodafone is aiming to make this easier by preloading MySpace mobile software on select handsets, although those using models without the preloaded programs still will have to download software. Orange says its customers won’t have to download software to access the Bebo site.

Both the Vodafone/MySpace and Orange/Bebo agreements are exclusive arrangements for the time being. While that’s a start, for mobile social networking to flourish, carriers will have to foster partnerships with many online brands. “The social value increases exponentially with the number of people you can reach,” says Müller-Veerse.

Stay Awhile

The biggest hurdle, by far, is likely to be pricing. Some countries, including Britain, now have flat-rate (“all you can eat”) and bundled pricing packages for wireless data—something analysts say is crucial to kick-starting widespread use of the mobile Web. Other countries, such as Germany, have yet to embrace such business models. Unless this changes, analysts say, it could severely delay uptake of mobile social networking because the primary users—youth—won’t be able to afford it.

Of course, for both operators and the social networking sites, it’s all about making money. But at this point, just how much is anyone’s guess. “It’s so early in the game that most are doing this as an act of trust,” says Gartner’s Jones.

The carriers aim to bring in new customers and boost wireless usage and uptake of data services. Orange, for instance, will target primarily prepaying customers, who, like Bebo members, fall largely within the 18- to 24-year-old demographic. Mark Watts-Jones, head of product development at Orange UK, says this is a promising avenue to boost data update because Bebo users spend a lot of time online. Indeed, researcher Nielsen/Netratings figures Bebo members spend an average of 2 hours and 37 minutes on the Internet site each visit, far more than visitors to rival MySpace.

Watts-Jones declines to give out details on pricing yet, but says customers will be able to buy a bundle that allows unlimited wireless access to It’s also planning special deals to woo Bebo users to become Orange customers, and it will offer paid “taster” sessions of the service.

Bridge to the Mobile World

Social networking sites also stand to gain from going mobile. Gartner’s Jones says one of the most promising opportunities is to leverage multiple channels. For example, mobile operators are finally starting to roll out location-aware services that deliver information and ads to customers based on where they are (see, 10/13/06, “Europe Takes to Location-Based Cell Service”). Social networking sites could tap into that information by introducing members to each other based on location. They also could deliver customized services to members logged in via their PCs, based on where they most recently traveled with their phones.

Helping ease content providers’ transition to the mobile sphere is the job of firms like London-based ShoZu, a startup whose software lets mobile users access and share pictures, podcasts, videos, and music with other mobile or PC users. Companies like ShoZu are key to the growth of mobile social networking, says Cartagena’s Müller-Veerse. “Because none of those Internet companies have competence from the mobile world they need a ShoZu to open it up,” he adds. “They are the bridge.”

These alliances are just a hint of how mobile social networking may look five years from now. After all, while loose “communities” existed via message boards a decade ago, who could have then envisioned a MySpace or a Bebo?