Sunny Data Forecast at BREW Show

RCR Wireless News
May 5, 2003

Aside from the warm coastal weather and plentiful sun, attendees of Qualcomm Inc.'s BREW developer's conference also enjoyed an almost dizzying array of statistics and metrics related to the application download technology-numbers that Qualcomm and BREW partner Verizon Wireless said demonstrate the real possibility of a successful wireless data market.

"This is the place for wireless data opportunities today," said Jim Straight, vice president of wireless data and multimedia services for Verizon Wireless. "Everything has come together."

Perhaps the most notable number comes from Verizon itself, which offered a rare glimpse into the machinations of the long-hyped but poorly understood wireless data market. Verizon said that its BREW application service, combined with its WAP platform, text messaging service and CDMA 1xRTT packet data network, accounted for 1.5 percent of Verizon's first-quarter revenues. That means Verizon generated around $76 million in wireless data revenues in its most recent quarter.

Although such numbers are hard to come by for U.S. carriers, Verizon's percentages were just a part of the picture. Verizon also said its subscribers have downloaded 8.5 million BREW applications since the service launched six months ago, and that in the first quarter, its customers downloaded an average of 2 million BREW applications per month. The carrier said the average revenue per BREW user is 8- to 10-percent higher than before the carrier offered the service. Verizon, which offers more than 100 BREW applications, said it has sold more than 3.2 million BREW-capable handsets to date, and expects to bring that total to 8 million by the end of the year. The Zelos Group predicts 9.8 million BREW handsets will ship in the United States this year.

An interesting side note to Verizon's BREW handset numbers involves Nokia Corp., the avowed rival of BREW creator Qualcomm Inc. Verizon confirmed that Nokia would build a phone that includes Qualcomm's BREW application download technology. Nokia wouldn't immediately provide details on the phone.

That Nokia will include BREW technology on one of its handsets is notable for a number of reasons. Nokia has made a major commitment to Sun Microsystems Inc.'s Java technology for mobile phones, a technology that competes with BREW (although the two are not mutually exclusive). Further, Nokia has gone to great lengths to set itself against Qualcomm and has promised it will not use Qualcomm chips in its CDMA phones.

But at the same time, Nokia has promised to improve its CDMA mobile-phone portfolio in order to boost its market share. CDMA carrier Verizon has made a strong commitment to BREW and has been pushing its handset partners to include BREW on their handsets-41 percent of all Verizon phones today include BREW technology. Qualcomm offers its BREW technology for free to handset makers.

For its part, Qualcomm also released BREW metrics, pegging the total worldwide number of BREW downloads at 28 million and the total number of BREW handsets at 8 million. Seven carriers on four continents offer BREW-based services, including Alltel Corp. in the United States, KTF in South Korea, KDDI in Japan, China Unicom, Vivo in Brazil and Telstra in Australia. Qualcomm also announced at the conference that U.S. Cellular will move to a full BREW deployment and that Midwest Wireless will launch BREW services.

"We're seeing a very rapid take-up by a variety of operators around the world," said Qualcomm's Dr. Irwin Jacobs.

Although conference goers were hammered with numbers, some of the most important figures were not available. Neither Qualcomm nor Verizon would say how many BREW downloads were free, leaving attendees to guess at actual revenues generated by the service.

Of specific note to developers, Verizon released a list of its most popular BREW applications, with ringtone downloads capturing the No. 1 and 2 spots. Games took five spots, while a picture application came in at No. 3. Longtime BREW supporter Jamdat Mobile Inc., which played a prominent role in Verizon's list, said it has recorded 2.2 million total BREW downloads to date, and that 12 percent of those were of its highly acclaimed Bowling game. The company said five of its BREW titles have hit the 100,000 download mark.

As with most BREW events, there was also talk of Sun Microsystems' Java technology, which works much the same as BREW. All of the other top national carriers, including Sprint PCS and Nextel Communications Inc., have announced support for Java, and the Zelos Group predicts Java handset shipments in the United States will hit 12.7 million by the end of this year.

Qualcomm and its BREW partners have largely bowed to the momentum behind Java; the company announced in March support for Java apps over the BREW platform. Qualcomm's Jacobs said three different Java programs, dubbed virtual machines, are today supported by the platform, and Verizon's Straight confirmed the carrier will offer Java applications alongside BREW.

"We're hoping that controversy goes away," Jacobs said.

Interestingly, Qualcomm's support for Java could have an adverse affect on its BREW efforts. An executive from the Walt Disney Internet Group said the company wasn't sure whether it would continue to support BREW if the platform was able to efficiently run Java applications. Larry Shapiro, executive vide president of business development and operations for WDIG, said he was unsure what the company would do in such a situation. On the other hand, Jamdat head Mitch Lasky said his company would continue to support the platform since BREW applications work more closely with mobile-phone hardware-an important issue for high-end games.