This is a weekly newsletter describing the non-confidential part of my work during the past week and how I see market evolution affecting Ericsson (as interpreted my me in my role working for LME/DMA in San Francisco as a business developer with a focus on Internet applications and enablers). The report will be published every Monday (except holidays).

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I spent two days at the Herring Venture 99 conference in Lake Tahoe which was one of the best networking events in this industry. The presenting companies were not the main issue, some of the presentations were actually quite boring. This was an event to create bonds with 700 industry influencers who attended - something we should do more and something were a strong market message for our Internet product portfolio would be helpful in.

Symbian - the New Star of Silicon Valley

Symbian was one of the companies invited to present at the Herring event. Actually they were given the “Best Overall Private Company in Digital Universe” award. This nomination is actually quite significant and it creates Symbian lots of goodwill in Silicon Valley, the heartland of the anti-Microsoft camp. I asked Tony Perkins, the publisher of Red Herring, and he answered: “We contacted Symbian and proposed them the award largely because they represent a challenger to Microsoft.”

(By the way, Microsoft, one of the sponsors of the event, said they have 2,000 people working with developer relations - I guess we have five or so - and their Silicon Valley operations have already cut deals with 200 Valley-based companies.)

The investment and support Ericsson gives to Symbian branding vs. our own EPOC “brand” is something I am not sure we have decided upon. Ericsson should perhaps use the Symbian brand as one of the leading platforms to promote our wireless Internet program towards the ISV and content community. Within that platform we should create differentiation for our own EPOC solutions. At least this is what the Red Herring support for Symbian suggests.

Sun Microsystems - Another Major Player without a Venture Fund

I never came to think about it: Sun has no VC fund. Separately, a number of SIlicon Valleys VCs established the $100 m Java Fund in 1996. However, Sun has recently mounted a major effort to support their developer community as a part of this they have become active in the venture capital community as “a strategic partner” to VCs. They were of one of the main sponsors of the event. - http://www.sun.com/developers

This kind of a role would perhaps also be possible for Ericsson. If we had a strong enough presence in Silicon Valley, we could make sure the major VCs come up with a “wireless Internet fund” and we could take the role of an active strategic partner.

The Founder of Vignette Lectures on Management of Growth

Ross Garber (32), the founder of Vignette, a leading Internet relationship management solutions (e-commerce) provider (built $2 bn market cap within two years), gave a thoughtful presentation with some quotes which speak for themselves. We should perhaps regard Vignette as a potential partner, particularly in the light of their recent acquisition in the CRM space, Diffusion, an acquisition with wireless ramifications (http://www.diffusion.com).  - http://www.vignette.com

“We are in the end of the Era of Product Marketing and we are entering the Era of Business Model Marketing, EBay, Amazon and Buy.com are great examples of that.” Ericsson has hardly entered the former era, maybe it is easy for us to make a “quantum leap” now when we promote paradigm-shifting technologies such as GPRS?

“In a dynamically changing environment, you have to be able to change your business model as you go: we are currently executing our third version. First we thought we would be a tools provider, then we realized we should actually be the big-footprint platform product provider and recently we have understood the major opportunity lies in being the big-footprint platform services provider.” Can Ericsson do “evolutionary business planning”? Perhaps something for iPulse to consider carefully!

“Today more and money money is chasing deals  which causes a valuation inflation and which decreases your margin to make errors in execution. Today you get much more money than two years ago with a much more ambitious requirement for executing on that money timely and in a much more competitive environment.” How can Ericsson execute well in this environment when we have not really practiced it when it was cheap two years ago?

I Still Think Ericsson Website Is Hard to Navigate

The way the market perceives it, Ericsson is a potential e-tailer and http://www.ericsson.com is a place where one goes to shop for phones and accessories. Period.

Next week I will meet with the people responsible for the Ericsson web strategy and hear what they have planned for us. In the meantime, check out the US site which actually has implemented a nice web shop: http://www.ericsson.com/US/consumer (how am I supposed to find here from http://www.ericsson.com?).

There was a consensus (*) at the Herring show that the best online etailer today is GAP. Check it out at http://www.gap.com. (*) according to Kate Delhagen, e-commerce analyst of Forrester and Mary Meeker, Chief Internet Analyst of Morgan Stanley.

Wall Street Favorites - The Pick of the Week

Last week Keith Benjamin continued his support to TicketMaster Online-Citysearch (http://www.ticketmaster.com), (http://www.citysearch.com), with an interesting take on dating services (potentially a big opportunity for wireless?). “TMCS announced it is realigning its operating units into two groups and also an acquisition. We believe the realignment allows TMCS to more effectively deliver its leading brand of local content with its quickly growing online ticket business, capitalizing on the benefits of the combined companies while recognizing the differences in each business. TMCS also announced the intended acquisition of Match.com (http://www.match.com), an online dating service, which we believe fits well with the CitySearch story given the concept’s local nature.” - Keith Benjamin, Chief Internet Analyst, BancBoston Robertson Stephens.

Nuance Is the Technology Behind Voice Portals

I talked to Ron Croen, the CEO of Nuance Communications, to get an update on what this company with a Motorola stake in it is planning. Nuance is partnering with Intel and Visa for voice-based V-Commerce. Their technology is now applied by 30 companies in a total of 40 applications. Their technology has been ported all IVR platforms (an opportunity for EPA’s i2HIP?)

Ron said the background behind the Motorola investment was that Nuance technology was considered better by Motorola which had to kill their own in-house speech research which has resulted in somewhat “slow” cooperation. He said the Motorola relationship is in no way exclusive.

Ron sees opportunities for cooperation in two areas: 1) server technology for customer support applications and 2) interface for voice-based web access (some new ideas available after signing an NDA).

I think we should also learn more about their new VSP Initiative, launched at their user conference a month ago. This might help us sell to cellular operators a voice-based ISP service on the side of the traditional one. - http://www.nuance.com

San Francisco Business Intelligence - Lessons Learned

Later in the week I was in one of my local bars in North Beach. At the counter a young lady, a visitor from Chicago, started talking to me. She was apparently celebrating something and had had a few drinks. After a while she pulls out a Motorola phone and goes: “My husband is the chief designer of the new Motorola phone.” She starts listing the new features and I ask for the shipping date and other details. She hesitates somewhat and says: “You must be working for Ericsson or something!” and walks away. A stupid mistake. You live and learn.

However, at the Herring event Elton B. Sherwin, the head of Motorola Ventures in Silicon Valley came to talk to me and was being very open. He said he has managed to get internal acceptance for three investments out of the nine he has suggested - apparently the Motorola organization is not very dynamic. Mr Sherwin said I should contact him if Ericsson ever wants to set up a VC fund… sounds like Motorola is a problem…

END NOTES - Third Voice was the big start-up sensation of the Herring event. The company has developed a Java-based community “gateway” which enables posting comments (stickers) on any web page in the world for other community members to interact upon. http://www.thirdvoice.com - The innovative auction site Priceline.com has now a $22 billion valuation a few months after the IPO. Eleven months of work has made Jay Walker (the founder) worth $3 bn. http://www.priceline.com - Is GoShopWireless something we have missed? http://www.goshopwireless.com - Lantronix said they would like to talk to Ericsson about telemetry applications. http://www.lantronix.com - Aeneid out of San Francisco is developing an “XML data stream outsource service”, something for GPRS perhaps? http://www.aeneid.com - Ipopcorn out of Palo Alto is developing and online community for kids and teenagers in Japan and Korea. The founder Ike Lee sold a datacom company Xylan recently and decided to do some fun stuff next. A great partner for our 3G Japan, teenager market development and Zopps people. http://www.ipopcorn.com -  Adam R. Dell of Crosspoint Venture Partners (a brother of Michael Dell) said (very late in the night) that he thinks PBX outsourcing will be a huge business. - Jon Medved of Israel Seed Partners said we should look at financing some of his portfolio companies like Foxcom (http://www.foxcom.com) (fiber-based wireless access products - probably uninteresting) and Dealtime (http://www.dealtime.com) (personalized shopping portal - perhaps very interesting for wireless e-commerce). - Sunil Sabharwal of GE Equity is the man behind the creation of NBCi, the new online media giant of NBC which will incorporate Snap as well as the newly acquires Xoom. This is something for the wireless portal business developers to add to the list of prospects. - http://www.snap.com, http://www.xoom.com.

That was all for last week, this week I am in San Diego attending the IBC conference Mobile Internet and Information Services.