Japanese telecom giant NTT Docomo’s venture arm has bought a stake in Silicon Valley mobile startup Cooliris, which makes software to share pictures on phones, in the latest sign of telcos expanding their reach by pumping dollars into app developers.
Though the stake was undisclosed, the deal announced on Monday is the second that Cooliris has received from telcos. Germany’s Deutsche Telecom had also invested in the company through its venture arm T-Venture.
Cooliris is known for its LiveShare app, which lets users share photos easily at events and to comment on others’ images using either the iPhone or Android phones. Previously, it had developed a browser add-on to share photos.
Telcos are keen to be part of the action, as more so-called over-the-top apps take centrestage in mobile broadband usage. Increasingly, their traditional revenues in voice calls and SMSes are being eroded by apps such as Skype and WhatsApp, which tax their networks while undercutting their revenues.
Today’s situation is a reversal from the early days of the WAP-based mobile Internet technologies, when telcos often demanded as much as 70 per cent of the cut of revenues for listing a developer’s app on their mobile online portals. Today, telcos themselves are looking to pump money into app developers to ensure they are not going to end up providing a “dumb pipe” while being bypassed in terms of revenues.
NTT Docomo’s investment has been likened to another Asian telco, SingTel. The Singapore company had bought United States mobile advertising firm Amobee for US$321 million in March. Two months later, the new SingTel outfit bought AdJitsu, a spin-off of Cooliris that worked on mobile 3D ads.
