AOL's mobile ambitions

Olga Kharif
28 Sep 2007

In recent months, Google's mobile aspirations have generated headlines aplenty. But out of the limelight, another major Internet player, AOL, is preparing to flex its mobile muscles as well.

Consistently trailing far behind Google (GOOG), Yahoo! (YHOO), and Microsoft's (MSFT) MSN in online traffic, AOL might not appear as worthy of worry in the wireless industry as Apple's (AAPL) iPhone or Google's prospective gPhone software platform.

Think again. U.S. traffic to AOL's mobile Web site is higher than that to Google Mobile's and double that of MSN Mobile's, according to Hitwise. Mobile-phone users also tend to spend much more time on AOL's sites than Yahoo's, says David Gill, an analyst with consultancy Telephia. 'Their audience is highly engaged, and advertisers like that,' he says. And judging by the recent ramp-up in its mobile efforts, AOL is determined to recapture some of its former Internet glory as a preeminent wireless hub.

Deals galore

Most significantly, AOL tells that it is working on what it calls a software module"”a unified application that would integrate AOL's multitude of mobile offerings into one master portal. At present, cell-phone users typically need to open separate applications to access services such as AOL Mail, AOL Instant Messenger, Moviefone theater listings, MapQuest navigation software, and City Guide local search"”and many carriers only offer one or two.

As these modules wouldn't serve as an underlying operating system for a phone like Windows Mobile, Symbian, or Java-based BREW, AOL's endeavor would not mark as dramatic an undertaking as Apple's (AAPL) adaptation of the Mac OS for the iPhone or Google's still-unannounced gPhone platform. Those efforts seek to wrest control of users from the wireless carriers. Still, AOL's goal is much the same: to provide a suite of mobile services that's quicker and simpler to use than the hodgepodge of applications loaded on most cell phones.

To date, AOL has cut deals with wireless carriers rather than handset makers to get its applications loaded on phones. But a source tells that AOL is now in discussions with HTC of China and other handset makers to install its software modules on their devices. AOL stresses that working with carriers remains a major part of its mobile strategy, but confirms that it is speaking with handset makers. 'We are actively engaged with all handset manufacturers,' says Scott Falconer, executive vice-president of AOL Mobile.

New features

AOL has revealed its wireless aspirations in other ways as well. In June, the company hired a telecommunications executive, former AT&T (T) vice-president John Burbank, as new chief marketing officer for all of AOL, not just the mobile group. The careers section of AOL's corporate site currently lists 14 mobile-related jobs in the U.S. and nine more in China. One of the openings is a senior strategy manager position with AOL Mobile. The job description says the applicant would help AOL with future strategic acquisitions, suggesting that Time Warner (TWX) is prepared to put money into this push.

Perhaps the biggest sign that AOL is serious about wireless is a slew of new and revamped mobile applications. The company recently relaunched the portal that users can visit via mobile Web browsers, changing it from a mostly text-based affair highlighting a few news stories to a richer site with a wider variety of content and ads.

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