When Microsoft Corp.’s CEO Steve Ballmer publicly mentions someone’s name as a respected veteran who will run a new company in partnership with his juggernaut, people listen. At CTIA I.T. & Entertainment 2007 in late October, Ballmer told a standing-room-only crowd that Mort Rosenthal had been tapped to lead Enterprise Mobile, a startup that will provide businesses with mobility solutions and services. (Microsoft is a minority partner in the private firm.) Some nodded, knowingly, while others hit their mobile browsers.
For the record, Rosenthal founded Corporate Software in 1982 as a distribution channel with service and support for large organizations in need of business software. Over the course of a dozen years, Rosenthal led the company to nearly $1 billion in annual sales and then merged it with R.R. Donnelly, the leading manufacturer of software. The new company, Stream International, retained Rosenthal as chairman and CEO and, two years later, annual sales had doubled to $2 billion.
Rosenthal must be intrigued by the challenges of a startup because soon thereafter he jumped ship and formed IMO Independent Mobile, which offers a comprehensive, simplified, online retail environment for consumer purchases of mobile phones and service.
Then Ballmer called. Microsoft needed Rosenthal’s experience with a startup that could support enterprise through the maze of planning, ROI crunching, deployment and service support needed to go mobile. Rosenthal agreed and he sat down recently with RCR Wireless News to share his views on the mobile enterprise.
What”s Enterprise Mobile’s raison d’etre?
Enterprise Mobile is here to help enterprise, particularly the I.T. division, to adopt mobility–particularly Windows Mobile–faster, cheaper and more reliably. There’s a misalignment of vision and the ability to implement. We’re about making the implementation as exciting as the vision.
Any color around getting “the call” from Steve Ballmer and this relationship with Microsoft?
We’ve had a long relationship with Steve and we’ve enjoyed ongoing dialogue on how to solve customer problems together. I worked with Microsoft in the 1980s and ’90s to resolve licensing issues and enterprise issues as software became more important. An invitation from Steve means a lot and we think the new prospect is an exciting one.
Your earlier relationship focused on the PC. Today we’re talking mobility. Can you put those two pieces in perspective?
Mobile is an extremely important platform and one that is potentially as important as the PC. Innovating around how businesses implement technology has always been important to my career and, together with Microsoft, we’ve done well at it.
You’ve called attention to “the gap”–the service gap that exists in the market between corporate needs and ability to implement. Describe the gap and how Enterprise Mobile will fill it.
What exists in the market today is, essentially, a consumer-driven device with multimedia on it and a bunch of interface elements oriented toward the consumer. Enterprise wants an enterprise-class device–a good corporate citizen with appropriate security, device management and protection of intellectual property that an enterprise requires. We’re about filling that gap.
When you’re envisioning an enterprise application, let’s follow best practices–including application development, infrastructure, services and devices.
Deployment, say, across a field-sales organization, can be a daunting task. Getting a consistent, useful, user experience across a large and dispersed installed base is complicated. We’re about getting that job done predictably.
Finally, ongoing management of mobility is probably the most important aspect of this work. Once you’re up and running, you’ve got issues of support, warranties and supply chain you need to address. We’re about providing out-sourced services so you don’t worry about heavy lifting in areas that are of relatively low value from a strategic perspective.
You plan to pursue Microsoft’s existing customers initially. What is the size of that addressable market?
It’s quite large. Windows Mobile use is growing rapidly, particularly among enterprises. We find many customers using tens and hundreds of Windows Mobile devices today who are envisioning using thousands and tens of thousands of devices over time as mobility becomes a critical platform for the enterprise. We’re naturally interested in the biggest customers, but we’ll serve anyone with a need for, say, a thousand devices. So second-tier companies interest us as well. We won’t run out of prospects for quite some time.
Return on investment is near and dear to corporate decision-makers. How do you approach that concept, given the diversity of individual cases?
The return is fairly simple to calculate, if you’re going to become more productive, more efficient or open new markets. You can look at your own economics and judge the return. The investment part is where you can run into a little trouble. You don’t really know what it takes to deliver mobility to your workers. That’s why we’re in business. Will it cost you $100 per device to deploy or $1,000 per device to deploy? There’s no one out there you can turn to for consistent help, with consistent service levels. We’re providing a predictable cost structure around deployment and ongoing management. That will get you a sense of the investment and total cost of ownership (TCO) that you need. The total cost of ownership work in this space just hasn’t been done. The cost of the device and service is straightforward. But what about the cost of support, training and downtime? Our customers are quite curious about how to figure that out.
What’s your sense of how, in general, decisions regarding mobility are framed and taken at the enterprise level?
I’d say decision making is composed of two different constituencies–one is I.T., the other is the business owner or the application owner. There’s a certain amount of natural tension between those constituencies. Typically the justification needs to come from the business owner. They want to automate their field sales force by placing customer relationship management (CRM) on the handset. I.T. says, “We can do that if you meet these security requirements.” Etc.
The other way is that I.T. sees mobile as an important platform and says, “~We’ve got to establish some rules.”
For the most part, the business owner acknowledges a need and goes to I.T. for help. I.T. may be proactive or reactive but it’s certainly part of the equation.
While fragmented, there is competition out there that can serve your target market. What’s your sense of who’s out there now?
Certainly there are firms providing the phones. In terms of the depth of experience with device management and servicing a line-of-business application, I honestly don’t see competitors. The interesting thing about this business is the adjacency to other businesses that develop an application for the desktop and now they want to take it to a mobile platform. We’re having lots of conversations with software integrators (SI) and independent software vendors (ISV) who can take advantage of the mobility infrastructure we provide, our expertise in logistics, to partner up. So we have an open partnership model. As in every business, you welcome competitors to some degree because they validate the market.
Is the timing here a function of the market need and awareness ripening or is Enterprise Mobile starting up due to recent technological advances?
The enterprise market is just emerging. A year ago we would have been chasing a lot of disinterested customers. Now, the customer base is interested. Certainly the availability of Microsoft’s System Center Mobile Device Manager makes a good confluence. We chose to wait until now for the announcement because it fit a broader Microsoft story as well. Having the infrastructure tools around device management, a requirement of enterprise, announced at the same time as a service organization
that helps enterprise to implement–well, the timing couldn’t be better.
