OpenGrid, Inc., a developer of instant messaging for wireless devices, announced today that it has received more than $8 million (US$) in backing from Motorola and Starfish Software CEO Philippe Kahn.
Kahn, the founder of Starfish, sold the company to Motorola last year for $256 million in stock and cash.
The investment is expected to help OpenGrid’s new technology make cellular phones and other wireless units capable of sending and receiving lightning-fast messages the same way that messages are sent via America Online’s Instant Messenger.
Many industry observers point out that even though wireless devices already exchange e-mail, this form of slow communication is unable to compete with the rapid interchange of online chatting. These analysts feel that such technology would be a major breakthrough for wireless devices — thereby transforming them into the preferred tool of the burgeoning e-commerce economy.
Analysts add that the technology would greatly simplify the ordering of merchandise via the Internet or communicating with an e-tailer’s online service representative.
“OpenGrid has key core technology that is the building block to the wireless Internet,” Kahn said. “Enabling the wireless Internet revolution with applications such as instant messaging for the next generation WAP-based (Wireless Application Protocol) devices is what OpenGrid is all about.”
Pieces Coming Together
Just last week, Motorola and America Online announced that they will be working together to develop instant-messaging capabilities for wireless devices — but no mention was made of the OpenGrid deal.
OpenGrid is also developing server software that would connect PCs and a plethora of handheld devices — automatically allowing them to send messages to whatever device is being used.
“The wireless market is exploding and OpenGrid is at the forefront of developing intelligent solutions that will deliver on the promise of a wireless Internet,” said Jens Horstmann, president of OpenGrid, Inc. “With the close of this round, we can now accelerate the delivery of our solutions.”
In addition to Motorola and Kahn, venture firms Advanced Technology Ventures and Labrador Ventures are pumping money into the privately-held company.
Once the undisputed leader in wireless phones, Motorola finds itself fighting tough competitors such as Nokia and Ericsson. Nonetheless, cellular products still make up about 40 percent of the company’s sales.
Motorola is also the third-largest manufacturer of semiconductors. Other products include two-way radios, radios, pagers, computers and networking peripherals.
The company has operations in about 40 countries and gets 50 percent of its sales outside the U.S. It also provides wireless telecom services in developing countries. Additionally, Motorola owns the Iridium communications satellite network.
In its fiscal year ending in December 1998, Motorola lost $962 million on revenue of about $29 billion. The company employs about 133,000 workers.
About Open Grid
OpenGrid offers core wireless Internet solutions that include wireless messaging, instant messaging and wireless networking. Its partners include Hilton Hotels and Cendant.