Vodafone picks RealNetworks for multimedia

Vodafone Group PLC will use software from RealNetworks Inc. to distribute audio and video content to users of its Vodafone Live wireless data service, RealNetworks said in a statement Monday.

The announcement is significant because it removes uncertainty for content developers and customers alike as to which mobile multimedia format Vodafone will support, according to one analyst.

Vodafone has equity stakes in mobile phone networks in 28 countries, mostly in Europe but also in Japan and the U.S., and partnerships with eight others, according to its Web site. Thirteen of these networks offer the Vodafone Live picture messaging service, launched last October.

The deal gives RealNetworks a way in to all the operating companies in the Vodafone group, according to Mark Donovan, director of strategy and marketing for RealNetworks' mobile products and services group.

"This is a group decision on technology direction to establish a technology across all their operating companies," he said.

Two Vodafone subsidiaries are already using RealNetworks' Helix Universal Mobile Server and Helix Universal Mobile Gateway software as part of a soft launch of the service's capabilities, Donovan said: Vodafone D2 GmbH in Düsseldorf, Germany, and Amsterdam-based Vodafone Omnitel NV, which operates a network in Italy.

RealNetworks has also developed custom middleware to interface with Vodafone's back-office systems and is helping to integrate it, he said.

A Vodafone representative could not immediately be reached for comment on the announcement.

Commercial services with paid-for content will probably not appear until 2004, according to Erika Shaffer, a spokeswoman for RealNetworks.

Vodafone has recommended to its handset suppliers that they incorporate RealNetworks' media player in their phones, she said.

There are already a number of mobile phones on the market incorporating RealNetworks' media player. The oldest of these is Nokia Corp.'s clamshell-format Communicator. More recently, Nokia has included the software in its 7650 and 3650 camera phones. Other manufacturers' phones carrying the software include Siemens AG's SX1 and Samsung Electronics Co. Ltd.'s SGH-D700.

The availability of phones carrying the media player is crucial, according to Alex Slawsby, a mobile devices analyst with market researcher IDC, in Framingham, Massachusetts.

"The handset market is significantly different from the laptop or desktop space: Phones typically come with one media player installed, and they keep it for the life of the device," he said. In contrast, computer users can download and install new media players when it suits them, he said.

The announcement is important for Vodafone, another analyst said.

"It's going to remove quite a bit of confusion as to which formats can be delivered," said Rick Doherty, research director for technical assessment and market research company The Envisioneering Group Corp., in Seaford, New York.

"It's important Vodafone has chosen a big company. They can be assured of a core base of developers for this content. They don't need to wait to train them," he said.

RealNetworks won Vodafone's approval ahead of eight other media player makers, according to Donovan.

This should be a wake-up call for the others, particularly companies such as Microsoft Corp., which distributes a rival media player, and Apple Computer Inc., which developed the QuickTime media format, the analysts said.

"It's something Microsoft and Apple must take note of," Slawsby said.

Other spurned suppliers may have included PacketVideo Corp. and NTT DoCoMo, developer of the I-mode system, Envisioneering's Doherty said, adding, "We haven't figured out the full eight yet."

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