Microsoft launches MSN mobile portals in Europe

Lucas van Grinsven

LONDON: Microsoft said on Wednesday it has launched mobile versions of its
MSN Internet portal in Europe which are specifically designed for the small
colour screens of handheld computers.

Two mobile MSN portals in France and Germany, for Pocket PC computers that
have access to the Internet over a Wireless LAN or a mobile phone network, went
live on Wednesday. British and Spanish versions will launch in coming weeks.

"The launch means that for the first time a broad range of MSN content
(...) can be accessed from mobile devices," Microsoft MSN said in a
statement. The portals will have special web addresses that are different from
the URLs that MSN uses for its portals that are viewed on a large personal
computer screen.

The US software company, which has set itself ambitious goals to become a
services and software provider to the wireless industry, also published the
first usage numbers of the SMS text message version of its web-based email
service Hotmail.

Hotmail over mobile phones generated 27 text messages per user per month in
the first month of service in Denmark and Switzerland, Microsoft said. These
messages come on top of an average 48 messages a month which subscribers
receive.

The initial success has encouraged Microsoft to also open up its Instant
Messenger service to mobile phones via SMS text messages. "Messenger will
be ready within six months," Vassili le Moigne, strategic development
manager for MSN Europe, told Reuters.

Microsoft has worked with its partner MIGway to limit potential delays that
occasionally disturb SMS traffic. It claims that delivery of text messages is
guaranteed within 20 seconds.

SMS services needed

The new services generate new mobile data traffic that can help offset
declining revenues from mobile voice telephony. Microsoft will receive a cut
from the extra revenues generated by SMS traffic from Hotmail, the world's most
popular web-based email service with 110 million users.

If cellphone subscribers use the service, they are asked to select people
from whom they choose to receive email over strings of SMS messages. They will
be charged for the number of messages they receive.

Spain's Telefonica Moviles signed a deal with Microsoft to offer the service
last month, but many other major operators are not ready. Some do not yet have
the software to bill for the messages; traditionally European operators can only
charge for text messages a subscriber sends, not for the messages he receives.

But Le Moigne said that operators who do not want go through a major billing
software installation, will possibly offer the service as part of a package, for
a fixed monthly fee. "The additional advantage is that it is easier for the
consumer to understand," he said.

The risks for operators offering a fixed fee package is limited, because the
gross profit margins on SMS text messages is north of 90 per cent. Because the
messages use the spare capacity of the wireless network they do not cannibalise
voice traffic.

MSN said it is talking to operators in many European countries.

(C) Reuters Limited.