TALLINN - Estonia's mobile phone-service innovator Fortumo plans to expand sales to Asian markets, specifically China, Malaysia, Indonesia and Taiwan, reports news agency LETA. The company offers the user to create his own mobile device SMS service, "in a quick and easy manner, with the possibility to generate revenue from it," says its Web site.
Fortumo is "one of the few new media companies in Estonia which has understood one of the basic formulae for global business success - sell, sell, sell," says an industry analyst.
The company has already recruited and hired a Taiwanese sales team, to work in Tartu. Its new regional manager for Asia in the Tartu office is Taiwanese-born Po Han Chang, who used to be in charge of Asian operations for ring tones, phone wallpapers and other similar entertainment work for the German group Fox Mobile, formerly known as Yamba.
"There are few companies who can say that they have done zero sales work, yet have users and cash flowing in from every door and window," boasts Fortumo executive director Martin Koppel. "We cannot sit and idly hope that we will become the next Twitter, YouTube or Facebook."
Estonian companies like to claim they will be the next Skype. According to its corporate structure and culture, however, Skype comes across as a great role model for many ambitious Estonian companies, Fortumo included. When Skype soared to success in the telecommunications industry several years ago, the media talked incessantly about its founders, Niklas Zennstrom and Janus Friis, and about the Estonian development team, headed by Toivo Annus.
Many of the key people behind the company's success never saw the limelight. For example, creative director Malthe Sigurdsson was behind Skype's image and user interface, and Taavet Hinrikus, who paved the way for Skype in Asia.
Po Han Chang, charged with sweeping the Asian markets, has nothing but praise for the company, saying that "This is one of the most creative business models in the field of Web and mobile services. This job is an opportunity that would have been hard to reject."
Fortumo is an Internet portal "which allows any person or company to create and launch their own SMS service, without the need of any special skills. The service could be an SMS poll, an SMS consumer campaign, an SMS chat or an SMS payment to be used for making a profit without any start-up and fixed costs," says the company.
The service creator, i.e. the customer, receives between forty to sixty percent of the turnover of their SMS business, depending on the country. As a rule, Fortumo will get five percent and the local network operator will get the rest. For example, if a company creates a Web game, it can use Fortumo to charge the participants for playing. If players are required to send a 10 kroons (0.64 euros) text message to play, up to six kroons of this will be paid to the game's creator.
Koppel notes that "Different countries have different understandings, different practices and different legislation when it comes to the SMS business. Fortumo cannot use the same model of operation everywhere. The big countries, India and China, have especially strict requirements."
"Asia is a tough nut to crack but its advantage is its huge population and the fact that people there like texting," he explains. "For example, in Malaysia, a mobile phone user sends twenty text messages a day on average."
Po Han says the Fortumo business model for Asia is innovatively unique because, so far, SMS services have only been available to large companies. Fortumo's vision is that its product targets smaller companies and ordinary people.
"It is definitely possible to do business in China. Around 7,000 text messages a day could be sent there via our services," says Koppel. "The greatest amount of energy must be spent on educating users. Also, the local market regulations might change overnight," he cautions. The company will focus on Europe, as it builds its distribution "in the riskier Asian markets."
The Estonians also have the U.S. in mind, which they have planned to target more thoroughly in the long run. According to Koppel, "The U.S. market has its own acute problem in the form of strict regulations." Under U.S. regulations, each service must correspond to a separate short code. Elsewhere, Fortumo services are identified with keywords. "If we had 30,000 customers in the U.S., we would need 30,000 short codes, something that would require us to change our service," he explains.
In 2009, Fortumo was chosen as one of the world's twenty most exciting mobile service start-ups at the Mobile Monday Peer Awards.
