By Mark Evans

Don Simmonds got his first taste of the wireless industry back in the mid-90s, when he helped build Clearnet Communications. Back then, the industry focus was on moving wireless devices out into the mainstream consumer space.

As the carrier quickly grew, Simmonds started to explore how other applications could be offered on existing networks. This led the Lenbrook Group of Companies — a private holding company owned by the Simmonds family — to AirIQ Inc. In 1997, Lenbrook invested in the fledgling mobile tech company.

Using wireless and Internet-based technology, AirIQ offered clients tracking and monitoring services such as car rental and trucking firms. “It was a new area: wireless communications to and from vehicles,” Simmonds said.

“One could say ‘How boring, you are talking to trailers and stolen vehicles.’ Our view was networks had been so committed to wireless voice that there were many underserved areas for services that could be massive in their own right.”

Simmonds’ belief in the potential of non-voice wireless applications has been validated by the strong growth of telematics, the technology behind global positioning systems. AirIQ is now one of Canada’s fastest growing companies.

AirIQ’s success is a good example of how Canadian entrepreneurs are making waves in the wireless industry, which is expected to see worldwide sales of 620 million mobile devices this year, according to research firm Friedman Billings Ramsey.

There are scores of entrepreneurs pursuing new wireless opportunities.

In many ways, it has become a “build it and they will come” market: the networks have been established and the application developers are now appearing on the scene to utilize them.

Entrepreneurs are entering the industry from a variety of places. Some, such as Simmonds, have been active for many years while others, such as Zim’s Michael Cowpland — best known for starting Corel — and SlipStream Data’s Ron Neumann have come from the software world.

There are many other important mobile entrepreneurs in Canada, but Simmonds, Cowpland and Neumann offer a good snapshot of what is happening and who to keep an eye on in the next several years.

MICHAEL COWPLAND, ZIM
The biggest question swirling around Michael Cowpland is: can he do it again? Over the past three decades, the 60-year-old has enjoyed two entrepreneurial home runs: Mitel, which he started in 1973 with Terry Matthews, and Corel, which once took on Microsoft. Cowpland’s latest venture is Zim, which makes text-messaging software for wireless carriers. Zim is hoping to capitalize on the growing popularity of mobile messaging, offering carriers a way to generate more revenue via a BlackBerry-like service.

Cowpland said the text messaging market is compelling because it has “unlimited growth with no dominant player. “The opportunity is gigantic,” he said.

“The forecast is data will go to 30 per cent of [wireless] revenue. If there is a $1-trillion-a-year cellphone market, the data market is worth $300 billion. We don’t need a big slice of that to do what we want.”

John Reid, president of the Canadian Advanced Technology Alliance, said Cowpland’s latest entrepreneurial foray is no surprise for someone involved with high-tech startups for the past 30 years.

“If you have this in your blood, it is always in your blood,” he said. “It really is the core of innovation to have these types of leaders. When you talk with Michael, he is pretty damn excited about what he’s doing, and you get that passion.”

Zim’s biggest strength is perhaps Cowpland’s copious enthusiasm. The salesmanship that made Corel the largest seller of graphics software in the 1980s and 1990s is very much alive and well at Zim. The way Cowpland sees it, Zim should be a slam dunk as more wireless phones are able to send and receive text messages.

“There are 1.5 billion cellphones (worldwide) that can accept data, and 600 million new ones this year,” he explains. “This compares with 500 million computers.”

Undoubtedly there is a sizeable market, with 45 billion text messages sent around the world in May alone. Still, Zim’s prospects are uncertain because it is a small player that appears to be highly dependent on Cowpland to provide financial support, at least in the short term. Still, Zim appears to be making some progress. Two wireless carriers — Mexico’s Telcel and Singapore’s StarHub — have started offering Zim’s software to their 26 million subscribers, while five carriers in the U.S., Australia, Malaysia and Hong Kong are conducting software trials.

Cowpland said he likes the text messaging business because it offers Zim revenue of about three cents per message. “It’s a recurring revenue model,” he said. “With Corel, when you got to version 12, it was tough to sell version 13 because version 12 was so good.”

In comparing Zim with Corel and Mitel, it is not surprising Cowpland believes his latest entrepreneurial foray has as much promise. “The last two reached a $4 billion market cap within 10 years; I’m sure this is my best plan ever.”

DON SIMMONDS, AIRIQ
In explaining how AirIQ plans to take advantage of the existing wireless infrastructure, Simmonds uses a simple formula: the company is investing $30 million to put systems in place so its customers can access its service in North America using wireless networks that carriers spent US$80 billion to build in the 1990s. With 115,000 subscribers, AirIQ finds itself well positioned in the emerging telematics industry. The company’s service lets customers locate vehicles, establish operating boundaries, receive security alerts and access automated inventory systems.

“We protect and manage vehicles,” Simmonds said. “We started with the commercial fleet market because it’s an ROI sale and a fast payoff for business. As the cost of technology is driven down, we would like to slip over to the consumer market.”

Going forward, Simmonds said AirIQ has three growth strategies.

The first is the consumer market — offering services such as people tracking and vehicle monitoring so that parents, for example, can tell how fast and where their teenagers have driven. Second, acquisitions will also play an important role as the company aims to create critical mass quickly. In June, the company took a major step forward with the purchase of Irvine, Ca.-based Aircept.com LLC for about $24 million. Lastly, Simmonds said commercial tracking services will also play an important role as firms look to track assets such as cargo using Radio Frequency ID tags.

Phil Magney, a principle analyst with the Telematics Research Group in Minnetonka, Minn., said while telematics has established a foothold in the vehicle tracking market, location-tracking services will be an attractive long-term opportunity.

“The core logic of coupling a wireless phone with a GPS receiver can provide location data for any kind of asset,” he said. “It could be a car, a person, a truck or a commercial vehicle. And it can certainly be cargo.” Simmonds said there are similarities between AirIQ and Clearnet. The strongest linkage, he said, is as people use the service it becomes something they don’t want to go without. George Cope, president and chief executive with Telus Mobility (which purchased Clearnet), said AirIQ illustrates Simmonds’ skill as a strategic and tactical visionary. “He tries to anticipate where the market is going, and be in business earlier than other people,” he said.

RON NEUMANN, SLIPSTREAM DATA
Unlike Simmonds and Cowpland, who are high-tech visionaries, Ron Neumann is more of a marketing/sales specialist who commercializes interesting technology.

“My strength is really jumping the gap between ‘Hey, this is cool but hold on, what problem does it solve?’ to ‘How do you build a solution around it?,’” he said.

Given this skill set, SlipStream is a fertile opportunity for the 44-year-old, who became the company’s president in 2001. With compression technology developed at the University of Waterloo in Ontario, SlipStream needed someone to take it to the next level.

“I am the guy who always thinks about how someone will use it and whether they will be willing to pay for it,” he said. What SlipStream sells today is technology that increases the speed of dial-up Internet access. At a time when close to 50 per cent of Internet users in Canada have high-speed access, a product for the dial-up market appears to be an anachronism. The Waterloo, Ont.-based company, however, has more than 800 ISPs around the world using the technology. “As we have seen in North America, there is a place for dial,” Neumann said. “In some third-world countries, dial is just coming on board. In many cases, they don’t have access to any high-speed infrastructure. This gives them a chance to look at high-speed content.”

SlipStream’s success is the latest chapter in Neumann’s career, which has included stints at five start-ups, including Waterloo Maple Software, LivePage and Tallgrass Technologies.

Neumann dismisses suggestions he’s a sales “mercenary.” Instead, he describes himself as a generalist who has been active in commercializing technology and promoting sales out of necessity. “I have run product groups, marketing groups, business development groups, funding, whatever it takes,” he said.

“I’m a generalist, and I get bored when I do any one thing for too long.”

With the dial-up market rumbling along, Neumann’s next challenge is taking SlipStream’s technology into the wireless world where it could be used to compress content, particularly among mobile workers looking to access corporate information.

“The fact is the core compression algorithm can be applied to so many different problems,” he said. “We set out to prove ourselves in one market, we have done that in a much bigger way than we anticipated, and we are now moving on to other markets.”

Web innovators
AirIQ http://www.airiq.com
SlipStream Data http://www.slipstream.com
Zim http://www.zim.biz