Why Wireless and Handheld Software Companies Fail

The failed and the “living dead” wireless software companies have suffered from one or more of the following characteristics:

1. Systems integrators rather than product companies

The integrator model for wireless software does not scale gracefully. Many wireless software companies created reusable code libraries but they didn’t productize their software for broad applicability across multiple applications or multiple verticals. The companies were dependent upon expensive hand programming to produce one-off applications for each customer. One-off products lead to one-off revenue models rather than recurring revenues which pay dividends year after year.

2. One big customer vs. go-to-market strategy and sales infrastructure

Point 2 is really a corollary to point 1 above. Some wireless software companies were initially successful because one of the founders had a special relationship to one or more major early adopter customers but didn’t have a marketing strategy --- or product --- to build a sales pipeline or business development program. The bear hug from the initial client prevented them from becoming a full-fledged company. Companies geared to one or two large, well-heeled, early adopter customers seldom scale to mainstream enterprises, let alone SMB.

3. Trying to apply a windowing/desktop user interface to mobile applications

The market is littered with unsuccessful attempts to build mobile versions of desktop applications. These applications were hard to use because they tried to do windowing on tiny screens and were aimed at desktop users rather than mobile users. These windowing applications were designed for users "browsing" to find relevant data and screens. This does not meet the day-to-day needs of workers in the field who are looking for a more linear process. On small screens, with mobile devices, field staff want to be led through a process. Desktop windows, menus, buttons, and tabs just confuse what should be simple processes. The applications also assumed constant connectivity and did not easily tie to mass market devices and enterprise software. Generally, these windowing applications proved unwieldy to use in the field and difficult to maintain.

4. Applications based on “Palm end-of-day synch” model

Many failed wireless companies provided software that was batch oriented and only synched at the end of the day. These earlier versions of wireless applications were not real-time, always on applications. Successful handheld software replicates central databases and synchronizes with remote, dispersed databases throughout the day. With "sync at end-of-day" wireless applications, the customers’ management personnel had no way of tracking progress (such as job status) in the field nor the ability to assign additional work throughout the day to increase productivity. The centralized databases could not update customers’ information, produce invoices, or request permits until the end-of-day synch was completed.

 5. Screen scraping approach

Many wireless companies simply replicated all or part of a web browser-based application – taking a web page specification and automatically creating a wireless application. This “thin client” approach creates long lag times and extra keying. Furthermore it requires browsing rather than process orientation, constant connectivity, and inefficient forms designs in field operations. These limitations slowed down operations and over complicated training and deployment. Many of these applications simply went unused by field personnel after initial attempts to master the software. In other cases, the requirement of constant connectivity proved fatal.

6. Overly optimistic business process re-engineering (BPR) vs. ROI focus

Implementing wireless applications offers significant and multi-faceted opportunities for companies to modify their business models. Companies can shift more responsibility to dispersed locations, provide real-time information that can be re-purposed for marketing and CRM initiatives, and reallocate field staff on the fly for more flexible and responsive operations. While all the above is true, the vast majority of new technology acquisition in the last few years has been ROI driven, rather than BPR driven. Successful sales over the last few years, in our experience, are all about ROI. Wireless companies that built a business strategy based on BPR have not be successful.

7. Failure to produce productivity enhancements in the field

Many wireless applications simply mobilized work in the field without providing real ROI value, partially because of the problems enumerated above. In fact, early wireless applications imposed a burden and slowed down processing in the field rather than reducing time and introducing cost savings.

8. Point Solutions - What you see is ALL you get

Wireless applications are often designed for only one specific business model within a vertical market. These products are not built to be customizable or to adapt to the unique ways a company may conduct its business. They also do not allow the customer to embody their business unique model. Nor do they accommodate functions that could enrich and integrate the wireless product with features like payroll or inventory.

9. Maturation of the technology

Many of the early wireless companies did not have the benefit of handheld devices with speedy processors, full-blown development environments, or significant data store (up to and exceeding 32 megabytes). Bandwidth and performance of wireless networks has improved by an order of magnitute from 5 years ago. Wireless service, while still not perfect, is nearly omnipresent for the urban and suburban parts of the US. Finally, device and data plan prices are much more affordable today than they were for the earlier generation of wireless data companies.

10. Hand Crafted Solutions Tied to Particular Hardware and Software

Many initial wireless applications were built on specialized hand held devices that were expensive, software that was totally hand crafted, based on technology that did not have a long-term development path, and packaged in an unwieldy form factor.  Companies committed to particular types of devices or technologies (e.g., Motorola Paging, Symbol Technology or Intermec) saw their market shrink as their platform of choice obsolesced.  Winners must be able to flexibly use a wide range of light weight, mass produced, low cost devices available from a variety of vendors on a variety of networks.

11. Benefits From Peripherals

Early wireless companies did not have benefit of the wide variety of peripherals that are available today including credit card swipe, signature capture, bar code reading, and printing. The emergence of BlueTooth technology has also enhanced the potential ROI and simplified connectivity to handheld devices. Complete solutions are much easier to create.

12. Too early, maturation of the market

In many ways the knowledge and sophistication of prospects has grown rapidly and equaled or exceeded the functionality of wireless applications. Even 12 months ago, many prospects were uninformed regarding wireless applications or thought that handhelds could only do email. Earlier wireless companies had to struggle with a conceptual sale that was frequently not cost justifiable.