Mobile phone companies look to capture social networking success

Mobile phone companies look to capture social networking success

By Sarah Jane Tribble
Rob Hernandez / Mercury News illustration

Web sites like MySpace and Friendster have gained popularity by giving the online generation a way to connect. Now the mobile phone industry wants to tap into that success.

In a partnership that could herald a new era in social networking, Palo
Alto start-up loopt plans to launch a new service today with Boost
Mobile, one of the nation’s biggest youth-oriented wireless phone
companies. Boost’s 3.8 million customers — who are mostly under 25 —
will be able to create groups of friends and keep track of them using a
combination of text messaging, pictures and the GPS technology embedded
in most new mobile phones today.

"Historically, that MySpace generation has been connected to the personal computer and the personal computer only,” said James Brehm, wireless analyst with Frost & Sullivan. “This is the next step and it’s a giant leap — it allows you to do it on the move.”

For Boost, and possibly its parent company Sprint Nextel, the loopt service means an advantage over other carriers — giving customers another reason to join, buy new phones or sign up for more minutes. For loopt, which has 17 employees, the deal means its first commercial success since getting $5 million in funding earlier this year from venture capital firms like Sequoia Capital, which backed Google.

Loopt founder Sam Altman, a 21-year-old who left Stanford University’s computer sciences program last year to start the company, said more wireless companies are expected to offer what he calls “social mapping” early next year. He declined to identify carriers.

Of the nearly 220 million wireless customers in the United States, many of the most avid users of new features like ring tones, callbacks and text messaging are the same 14- to 25-year-olds who use social networking Web sites. Yet mobile phone companies have struggled to create a way for people to network.

“Young people are really into this social networking,” said Phil Leigh, senior analyst for Inside Digital Media. The service loopt provides “really is something that’s going to fit a need.”

Interest in idea

And there seems to be an interest. About 1.4 million mobile customers logged onto MySpace using the wireless Web in September, according to Telephia, a wireless research firm.

Nitin Khanna, Boost’s product manager for value-added services, said young people are asking for more ways to use their phones.

“This is the right solution, the right partner and the right time,” he said.

Loopt’s service has a colorful Mapquest-like graphic that updates every 15 minutes to pinpoint friends and indicate whether they are available to talk or text. The map also shows small photos and text messages like “busy, busy” for the friends it finds, and gives users the option to call, text message or send a picture to them.

Since launching a beta test without promotion or advertising on the Boost site six weeks ago, loopt has signed up more than 30,000 users.

Mark Jacobstein, loopt’s executive vice president of corporate development, said the widespread availability of GPS service on phones is the key technology that makes loopt work. In addition, he said, loopt has strict privacy and security safeguards, including requirements that friends must be invited and accept each other.

Mobile lives

“We’re trying to deepen relationships with people you already have relationships with,” said Jacobstein. “We all live very mobile, active lives, and you never know where anyone is.”

Under the partnership, Boost’s customers can use it for free until the end of the year. Starting in January, the service will cost $2.99 a month with the first 30 days free.

For loopt’s Altman, making the service easy for cell phone users to get will be key to the company’s success. Altman said loopt’s Web site is also a place to share journals and photos, but for now the main focus is mobile.

He knows his audience.

Growing up in St. Louis, Mo., Altman got his first cell phone when he was 11 and has been a constant user since. The idea for loopt came to Altman after too many times of leaving a Stanford class and trying to text friends to see if they were nearby and wanted to grab lunch.

“In college and high school, you live and die by your cell phone,” Altman said.

 

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