ITGumbo: spicing IT up

Company Overview
As the Website states, "Red Bend Software is the market leader in Mobile Software Management and Firmware Over-the-Air (FOTA) update solutions." Red Bend Software "helps mobile phone manufacturers and network operators to accelerate the adoption of new services and features, respond rapidly to customer needs, and reduce support costs through mobile software management solutions." Basically, it gives the user more control over what software components he or she wants on their phone, which also helps to increase the data service revenues of phone carriers. The main solutions include firmware updates, software component updates and data management.

Red Bend was founded in 1999 by current CTO, Sharon Peleg and is currently lead by President and CEO, Yoram Salinger. Its investors include Carmel Ventures, Pitango Venture Capital, Poalim Ventures, Infinity and Greylock Partners.

Firmware over-the-air (FOTA) and vCurrent
The company's main solution, FOTA is, according to an ARCchart report summary, "the technology and process allowing embedded software (firmware) to be updated wirelessly, anywhere, and at any time." FOTA can help speed the time-to-market process and offers long-term potential for adding new revenue streams post-sale. Manufacturers such as Nokia and Motorola can then offer firmware updates through their website. The summary can be viewed here.

According to Matimop, vCurrent "can be implemented on any platform in a scalable manner, while ensuring complete security and reliability to the user. This allows providers and developers to harness the full potential of remote software deployment, in full integration with existing business processes and development environments.

Analysis: Will Google's Android affect Red Bend's progress and its market?
Since VC investment in the Telecom industry reached over $900 million early in 2005, the industry has been considered relatively healthy and is expanding every day. With this comfort, start-ups and established companies have both focused on the wireless industry in recent years, producing and creating a wide-array of solutions throughout the industry that have increased revenue streams.

As part of this surge, mobile phones have been introduced with more software embedded in them, causing manufacturers and carriers to have the challenge of fixing more software glitches and adding new services, post-sale. Red Bend's firmware over-the-air (fota) solutions, especially its vCurrent, helps address this challenge in a profitable way.

FOTA solutions have become so popular that, according to ARCchart estimates, "at least 230 handset models have been released globally between 2003 and October 2006 that include FOTA support." It goes on to estimate that by 2008, "50% of all handsets shipping will be FOTA-enabled."

However, while these handsets will be FOTA-enabled, several questions must be asked, including, how many consumers will know about this service? How many of the phones shipped will actually be purchased? And, most significantly, how many users will be interested in changing the phones features using this method?

The announcement of Google's open mobile platform, Android, yesterday, amplifies these questions and raises several more. The impact Android will have on mobile software management and Red Bend can be considered as follows:

- Android, is about bringing more freedom to the mobile phone customization experience. As such, it is expected that it will increase the amount of software, features and Internet access usage in phones in the United States, and, thus, help increase the demand for Red Bend's
technology.

- Should the platform somehow affect Red Bend negatively, while Google tries to standardize the mobile platform, it would take time before Red Bend would really have to sweat over its business plan -- most phone manufacturers in Google's current Open Handset Alliance
are still testing out different platforms, and probably won't commit to a standard platform anytime soon (if ever).

- According to senior vice president of IAG Research, Roger Entner, "the wireless industry is not the Internet, and they [Google] are approaching it as if it was the Internet." Entner speculates that "for the foreseeable future, the Google phones won't realize any more than a single-digit market share." This makes it unlikely that it will penetrate the smartphone market significantly, which is a big part of Red Bend's market but it still might actually help it out -- if smartphones are faced with more competition and become cheaper.

- Finally, it will be interesting to see if the platform and alliance will have any direct impact on Red Bend's services in the near future. It will also be interesting to see if any phones that are released with Red Bend's FOTA in late 2008 will have Android as the OS.

Additional Resources
Video: FOTA in use on Nokia N73
Analyst reactions to Google's unveiling Android and a free mobile platform
Red Bend Software's mobile phone markets
About Android
The growing machine-to-machine (M2M) market
Advancements in MSM technologies