Mobile-Phone Show: The Startups Shine

At the Mobile World Congress in Barcelona, the real buzz was off the red carpet where tech starlets showed their talent

Away from the mating dance of tech titans and the hubbub of industry pronouncements, sometimes the most interesting technologies at the annual Mobile World Congress in Barcelona are tucked away in the corners of the huge exhibition halls where startups show their wares.

Indeed, scores of little-known companies are working to solve knotty problems faced by the industry, coming up with money-saving schemes, or devising eye-popping new services. Take Flexenclosure, a Swedish company that won an innovation award this year. The company, based in Lidköping, makes seemingly unglamorous telecom shelters, switching stations, and mobile sites. But now it has developed a way to cut carrier operating expenses by more than 50% while helping them place equipment where the electricity grid is sketchy. Their solution? Base stations that run on several different renewable power sources, including sun, wind, fuel cells, and biodiesel.

Other small companies concentrate on making everyday life easier for people on the go. One such company, Britain's EchoTranslater, has come up with a novel way to help travelers who don't speak the local language. It provides a selection of clickable screen icons for everyday items such as drinks, toilets, taxis, and food. Don't know how to order a hamburger in Tokyo? Click the burger icon on your handset screen, and the phone comes up with a text phrase in Japanese that you can show the waiter.

Improving Sound, Improving Silence

The bulk of the startups, though, are busy developing new moneymaking services for carriers. Israel's Dyuna, for instance, offers a global marketplace of digital media to help operators and consumers alike gain access to a bigger catalog of content. GestureTek makes mobile-phone gaming more fun by letting users scroll menus, navigate maps, move through game worlds, or even browse Web pages by shaking, rocking, or rolling their cell phones—a bit like a Nintendo (7974.T) Wii remote. And Denmark's Zyb brings social networking to a whole new level by tying the lowly address book in your phone to an interactive world of Facebook, Google (GOOG) Maps, and other Web 2.0 services.

The innovations aren't limited to software and services. Chips made by Israel's Siano Mobile Silicon improve mobile TV on high-speed trains, in elevators, and for up to 20 hours on smartphones, promising to help operators boost uptake of TV on the go. Inside Contactless, a French semiconductor company, is helping cell phones morph into electronic wallets. And Mountain View (Calif.) Audience has devised noise-suppression technology, based on the workings of the human ear, that helps filter out background sounds when you're using your phone on the street or in a crowded place.

Still, the bulk of eye-catching innovations this year pertained to services. France's Video Publishing on Demand, for instance, is offering a fast way for mobile operators and handset vendors to create new services to compete with Nokia's (NOK) new Share.ovi portal. IceMobile, a Dutch mobile entertainment company already working with some 40 operators worldwide, recently added a new service that allows consumers to broadcast live video directly from their mobiles. And Israel's Fring has introduced a new type of mobile Internet service for talking, chatting, and swapping everything from music clips to videos.

Where Money and Opportunity Meet

To be sure, potential big customers such as BT Group (BT) and Vodafone (VOD) aren't the only people cruising the aisles looking for good ideas. So were the venture capitalists, such as investors from big European firms 3i (III.L) and Sofinnova Partners. London-based 3i says it's looking to invest this year in mobile search and advertising, as well as technologies that help operators cope with the uptake of broadband and mobile TV.

The startups relished the opportunity to be on display in front of the who's who of the mobile industry. Uri Admon, chief of Dyuna, grinned when one conference attendee asked him if he knew the way out of Hall 4. "You asked the right guy," he said. "We startups are always looking for an exit."

For a look at 12 intriguing mobile startups, see our slide show.

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