Mcommerce firm wins standards funding

Communications company Red Message has secured $20m worth of financial backing to help develop new standards in the mobile commerce market.

Red Message, which enables users to receive information from the internet directly to their mobile phone, will receive funding from a group led by US investment bank Goldman Sachs and news agency Reuters.

The company, which launched in the UK in December, lets businesses transact with their customers from any wireless device regardless of the customer's mobile operator. Users select what information they want to receive from a website that hosts Red Message and the information is delivered as a text message to a GSM mobile phone.

Despite the increasing number of companies launching Wap-based mobile commerce (mcommerce) services, Red Message said the use of short message service (SMS) is a simple way of enabling businesses to reach its customers.

Frederik Landahl, Red Message's chief executive, said: "SMS is not a new thing, but how we use the technology makes this unique. Businesses can combine text and voice to reach a wider customer base. We believe that new technologies will help mcommerce, but we are sceptical at how fast the market responds to this."

Red Message said it will invest the money into its research and development centre in Sweden to ensure that the use of emerging technologies, such as general packet radio service (GPRS), will be an easy transition for businesses and their customers.

Customer relationship management (CRM) application provider Chordiant Software supports the view that rushing into Wap can do more harm than good.

Neil Morgan, Chordiant's marketing director, said companies should think hard before rushing to embrace interactive platforms such as Wap and the internet. Developing new platforms in isolation from existing channels could lead to a disjointed experience for the customer and information gaps for the company, warns Chordiant.

Over the weekend BT Cellnet's Wap phone service experienced problems, according to reports. The mobile operator's Genie Wap service operated at 50 per cent of capacity, which meant that half of all Wap calls could not be directed to pages requested.