The mobile Internet has been in gestation for many years now and many of our investment clients wait for a turn
into the “mainstream” to mark an inflection point in the business where they feel that technology is no longer a
primary risk. We are here.
It’s easy to get distracted while looking for the next big thing to miss the current one. Virtualization and data
center consolidation is good but it touches only a small fraction of the world. The mobile Internet will touch
everyone and cross both enterprise and consumer technology markets. This is a “fat pitch”, as my partner Steve
Waite likes to say, and it’s been floating towards the plate for a year or two now.
If you think this is old hat, there isn’t any reason to read further unless you don’t already own substantial
positions in at least Apple and Research in Motion. There is also a broader ecosystem of companies that range
from content to services to applications to components that will help us unearth a larger list of investment names.
We have to insist on Apple and RIM as a starting point. If you are not currently fully invested in this space please
take the time to read on and then take action.
Why now? The simple answer is that the applications to drive adoption of mobile Internet devices are here. Up
until recently we only had mobile email, which is a niche, and SMS, which doesn’t really require more than a
simple phone. Now we have the web, maps, location services, video, music, and imaging all on a device that can be had for a few hundred dollars. More reasonable service plans and the ability to exploit increasingly ubiquitous Wi-Fi networks are also important contributing factors.
The other important top name to hold in this space is Google. Not for the potential for Google phones or
devices in the mobile Internet space itself, but rather the amplifying effect that the spread of the mobile Internet
will have on their core business. This is a very big deal and we’ve seen it before. Decades ago we discovered that bringing in thousands of personal computers into a mainframe environment actually increases demand for
mainframe cycles. The net effect is from the more powerful requests coming in with more frequency than human
users could ever strive for on dumb terminals. The spread of smart networked devices that can be used on the go is a dramatic positive for Google.