Two Israelis have developed a key technology for a new generation of cellular phones.The proliferation of cellular phones around the world is quite astounding. Over 400 million cellular phones were sold in 2000. The number of devices based on the Web will surpass 500 million by 2004, and 1.4 billion by 2006, according to the ARC Group, an industry consulting organization.

While today’s cellular phones are very sophisticated electronic devices with substantial computing power, they are used primarily for one thing – voice communications. With so many people using cellular phones, it makes a lot of sense to attempt to bring additional, non-voice, services to these devices. In the last few years, technologies like Wireless Application Protocol (WAP) and Short Messaging Service (SMS) provided key means to offer new uses for cellular phones. These technologies allow data from central computers to be displayed and manipulated, to a limited extent, on mobile devices. However, WAP and SMS are cumbersome and time-consuming and, thus, have a limited commercial appeal.

The next generation of services is based on “Dynamic Content.” Phones with this technology will offer many of the features of personal computers, with their richness, flexibility, and variety. Having real features on cell phones will make new services easier. Instead of endless key clicks on the tiny cell phone keypad, users will work on an icon-based screen, similar to a Palm Pilot. A cellular user can order a cab, place a stock trade, start a video game or check a customer record with the touch of an icon.

But, two elements still hinder a carrier’s ability to offer these new features. First is the lack of standardization in the hardware and software used to build mobile devices. Unlike desktop PCs, different mobile devices use different operating systems and architectures. Therefore, offering the famous Snake game to multiple mobile devices requires a revision of its software each time it’s to be used on a new device. This issue is being addressed by several companies, such as Sun Microsystems, Microsoft, and Qualcomm, which are developing a standard platform for mobile devices. As these standards gain acceptance, the mobile platform will become as uniform as the desktop PC platform.

The fact that mobile devices are small and dependant on batteries creates the second issue. These devices have a small amount of memory and no storage capability, unlike the hard drive of a PC. As a result, mobile devices are limited in the number of uses they can have. Adding or removing an feature is a process typically done by a carrier service station if at all. Providing a rich variety of services and applications to customers requires a different method. This involves the Over The Air delivery of computer code onto mobile devices. With OTA, once the user touches an icon on a cell phone, the code for the feature is streamed onto the mobile device. After the user stops using the feature, it erases itself, making room for a new one.

A two-man team walked into my office in late 1999 presenting something that sounded like the above description. Dr. Ophir Holder, and Yorad Gidron, both Technion graduates, were seeking funding to create a new company developing an OTA platform for cell phone carriers. The company, Mobilitec, was established in April of 2000 and had its first product tested with two major carriers by September of 2000. Mobilitec was the first company to successfully demonstrate that OTA delivery of applications is feasible and delivers on much of its promises.

Today, Mobilitec is a world leader in the emerging market of OTA delivery platforms facing competition from companies in the United States and Europe. It is hard to tell how the company will evolve and what its impact will be. However, Mobilitec is yet another example of how small companies from Israel are leading the way for a new worldwide technology trend. Mobilitec follows in the steps of companies like CheckPoint (internet firewall), Amdocs (carrier billing), and Galileo (networking silicon), which were successful in indentifying real market needs and later became the lead companies in their markets.

Ophir passed on a promising academic career to become chief executive of the company, which now employs 32 people. After raising about $15 million from industry leaders such as Sun Microsystems and Lucent Ventures, Ophir is determined to have Mobilitec continue leading the new world of mobile services made possible by his OTA delivery system.