Walking along Constitution Avenue in Washington DC, I was debating with my son whether the metro or the bus would be quickest at getting us to Silver Spring in North West DC.
The debate was short. In 30 seconds he said: ”Dad, take the bus”.
He had checked the times on his iPhone and communicated with a friend on Facebook as we walked – a simple and clear demonstration of how mobile technology has come of age, giving ready access to intelligent information, everyday and everywhere.
The rate of adoption of mobile internet applications has surprised most market commentators. In the mid-1990s, AOL and Netscape reached 17m subscribers in just over two years, and this was considered a dramatic pace of increase.
In a similarly short time the mobile internet has reached 57m subscribers through the iTouch and iPhone, driven by the remorseless rise in mobile phone subscriptions. These subscriptions are expected to reach 5bn this year, equivalent to three quarters of the world’s population.
This is empowering people to carry out small tasks at any time, anywhere and it is changing the way they behave as consumers.
The changes are far-reaching. Mobile applications are not only creating another channel but also providing the opportunity to launch new products and services, create more intimate relationships with the consumer, and enable significant productivity improvements.
On the flip side, new mobile-enabled business models have significant disruptive power, representing a new threat to established business. Amazon’s Kindle is a case in point for the publishing industry.
The business sectors which are embracing the opportunities that mobile presents range from healthcare to retail banking to energy.
Healthcare providers are using mobile to reduce expensive infrastructure by giving patients with complex diseases more involvement in the management of their conditions without having to visit hospital. In the UK, the Telehealth project uses monitors to track and transmit the patient’s vital signs from home to clinicians remotely, reducing costs by a projected £1bn.
This is just the start. As the pressure on healthcare providers grows and reimbursement models, by which companies agree to refund costs of unsuccessful treatment, become more prevalent, mobile monitoring will play a key role in checking whether drugs have been taken accurately.
In retail banking there is a slew of mobile products and services designed to improve the customer experience. These include simple two-way SMS services that offer instant information and reduce the cost of customer service.
More advanced mobile services using mobile web and downloadable applications not only replicate the online banking experience but are also capturing new revenues from payments and other added value services.
At the same time, new entrants such as Mint.com and Square are providing financial services unique to the mobile device in ways that threaten to disrupt the traditional banking models.
The energy sector is investing heavily in mobile, helped by governments. Under US administration’s stimulus package, Congress has authorised investment of about $4.5bn to propel smart-grid development. This allows for remote monitoring of power usage and more efficient management of the grid.
A number of companies have seen the potential of this approach, with Pepco Holdings recently unlocking $168m for their smart grid projects. Utilities in California and Texas alone are spending $6bn on advanced digital meters and related systems, a key building block in a smart electric grid.
For any business there are many obstacles to overcome before the full benefits of mobile business can be realised. Implementing a mobile business strategy requires considerable innovation and experimentation, working in partnership with a complex ecosystem of network operators, device manufacturers, application developers, as well as internal functions such as IT.
This also presents significant leadership challenges, first and foremost in managing risk and reputation, but also in helping the organisation embrace the potential of mobile through providing top-down sponsorship and leadership of its implementation.
In many ways this is not new, the availability of information for consumers has long been a driver of business development: Benjamin Brandreth (of Brandreth Vegetable Pills) pioneered the use of the giant billboard 150 years ago. Huge billboards screamed to the public from the tops of building and the roadside, to ”buy my pills” and changed the way consumers found out about products.
Today’s smart information age offers the opportunity to achieve a similar transformation. It is not too fanciful to imagine products being sold through an interactive poster, with people browsing, buying and paying while they ride the metro.
The prizes for getting mobile right are significant. Mobile business is starting to deliver on expectations, and offers a wealth of future possibilities, as demographics change and technology savvy kids grow to become the consumers of tomorrow. Smart business leaders are the ones seizing the opportunities mobile offers.
Peter Siggins is a mobile business specialist at PA Consulting Group.
To read the full article in the Financial Times, please click here.