APN Invests in Mobile Data & Ecommerce

APN News and Media Limited , Australasia’s largest operator in regional newspapers, radio broadcasting and outdoor advertising, today announced investments in two companies leading the introduction of mobile data and e-commerce to Australia.

APN has signed heads of agreement to take a 35% stake in a joint venture with InTouch South Africa, and a 25% equity position in Soprano Design, Australia’s leading developer of mobile e-commerce software.

APN chief executive Cameron O’Reilly said the two investments would be undertaken by APN Digital, the company’s new media development division.

“These two investments put APN in a very strong position to take full advantage of the introduction of mobile e-commerce in this country,” Mr O’Reilly said.

“This is an extension of APN’s ongoing strategy to offer our customers and advertisers a fully integrated solution to their information needs. As people become more mobile and the fragmentation of in-home media continues at an even greater pace, we must be able to provide information solutions that will reach people wherever they are.”

The investments with InTouch and Soprano are based around the latest mobile telephone technology, including short message systems (SMS), wireless application protocol (WAP) and general packet radio service (GPRS).

The joint venture between APN and InTouch South Africa will be known as iTouch Australia. InTouch has an established successful SMS development contract with Vodacom in South Africa, and is 30% owned by Independent News & Media PLC, APN’s largest shareholder.

The Australian operation will provide mobile telephone owners with the ability to subscribe to SMS alerts, such as share prices, weather alerts, sports results and breaking news. iTouch will run its own alerts services, promoted extensively through APN’s radio, outdoor advertising and publishing assets, as well as wholesale the technology to telecommunications companies, Internet Service Providers and to corporates. APN’s contribution to the joint venture includes an extensive branding campaign through its existing media assets.

Mr O’Reilly said: “This is a great opportunity for APN to leverage Independent Newspapers’ expertise in this area, and to bring InTouch’s world class systems and technology into the Australian market.”

The investment in Soprano Design, Australia’s leading developers of WAP software, complements the iTouch joint venture. Soprano has existing WAP development contracts with Australian telecommunications companies and is well advanced in talks with several banks. WAP technology allows people to conduct transactions using the latest WAP-enabled mobile telephones, such as paying bills, trading stocks, ordering tickets or even placing a bet. Using the GSM or CDMA mobile telephone standard, the WAP software developed by Soprano can turn a mobile telephone into a virtual Automatic Teller Machine, giving users access to transactions on the internet using their mobile handsets.

“APN needs to develop and market content for future technological distribution platforms, just as it is doing for the internet,” Mr O’Reilly said. “Mobile data has the potential to be even more prolific than the internet, given the large and growing penetration of mobile phones around the world.”

Completion on both investments is expected to take place during November.

The projected growth of mobile internet access through technology such as WAP will create a range of business opportunities for the two companies. Finnish mobile telephone manufacturer Nokia has predicted that there will be one billion mobile telephones in circulation by 2003, and 60% of those will be WAP-enabled. A United Nations report has described the growth of mobile telephony as “astounding” and says mobile phones will outnumber traditional phones within the next 5 years.

The growth centres for the next generation of mobile telephony will be outside the United States, where conflicting operating systems are competing for market leadership. The GSM standard in use in Australia is the same as for Europe and will give those markets the edge in developing new products. Oracle software chief executive Larry Ellison has said that European telecom developers have an 18-month to 2 year head start on the US industry.