Important new ways of doing business will emerge from the confusing array of mobile applications and services.

The wireless Internet and the mobile applications that flow from it are possibly the most over-hyped and confusing technologies of the new millennium. According to our research, much of the hype surrounding mobile applications will be justified in time; but real penetration will be uneven and the path will not be linear.

Mobile applications are emerging but they are immature. When and where they do take off, they will evolve into mainstream applications involving large numbers of end users. We already have enough information about mobile's future to start planning how to incorporate emerging mobile applications into the IS planning and development cycle.

Within 10 years, always-on, wireless, wearable, context-dependent computing and communications devices will be in the mainstream of work and society. Wireless access will be indispensable to mobile workers, and in many industries, wireless applications will be an indispensable part of doing business. Virtually everyone will expect to have, and expect you to have, wireless access. We will see the overlaying of the electronic world of intelligent devices onto the physical world of people and places.

The sceptic in me has been convinced of the mobile phenomenon by four key factors: economic, social, business, and technological.

Economic imperatives- falling prices. The falling price of mobile airtime and key mobile technologies is making new applications economically feasible. Mobile phone chip sets are expected to fall to $US35 by 2006. At this price point, it will be practical to build mobile communications into medium-priced consumer electronics, such as washing machines.

Social imperatives- mobile lifestyle. Mobile phones have already become a mandatory lifestyle accessory in many societies and social groups, especially among young people. The intersection of mobile technology, fashion and entertainment will encourage such groups to readily adopt new devices and applications. My 23-year-old daughter no longer has a landline in her apartment. There seemed to be no point- she is rarely there so why pay for it?

Business imperatives- anywhere, anytime reach. Many organisations seek new mobile applications to reduce costs, to satisfy the growing need for "anywhere/anytime" customer service and to bridge supply chain gaps. Increased mobility in the workforce has driven enterprises to find new ways to maintain contact with employees and to attract customers. My US colleagues are gradually starting to accept that they can just about always reach me on my office number- no matter where I am. That number is permanently switched through to dual-band mobile- except for the few days I am actually in the office. If the phone is off (yes, I do like to sleep), then they can leave a message.

Technological imperatives- taking opportunities. Much greater bandwidths, and new technologies such as precise location sensing, will enable new applications, including shopping support portals that find alternative sources for products and services near the consumer's location.

Japan and Canada Forge Ahead

These imperatives are nowhere more apparent than in Japan. In February 1999 DoCoMo, the mobile division of Japanese telephone company giant NTT, introduced its I-mode mobile data service.

I-mode uses current mobile technology in a clever way. It operates at just 9.6Kbps, the same speed as the GSM system used in Europe. Because it is based on packet technology rather than circuit-switched systems used in Europe, the zero latency required to send messages dramatically reduces response time. (GSM has 20 to 75 second connect time.) When you push a button it feels like something is happening unlike circuit-switched GSM delays. It beat WAP and others to market by using a proprietary compact Hypertext Mark-Up Language system while global competitors were still debating resolution of the WAP standard.

I-mode is incredibly successful, with 28 million subscribers (as of November 2001). There are over 40,000 I-mode sites, mostly from independent content providers, with the average use accessing ten sites a day. Applications include messaging, entertainment, games, and dating, with increasing use being made by organisations using the network for field service and CRM applications. The phenomenon is that people now look at their phones more than talk into them.

Another success story is Canada's Bank of Montreal and Veev, a wireless based financial system that allows access to a range of banking and brokerage services, plus "lifestyle" applications like weather, news and horoscopes. Veev is available to all the bank's clients, and has been extended across Canada and into the US (through Harris Bank). Its most popular use is for investment portfolio alerts, and through business partners it has been extended to mobile commerce applications such as bookselling.

Veev is accessed via WAP-enabled mobile phones. Banking services include viewing account balances and history, bill payment, and transferring money between accounts.

Where Are We on the Timeline?

Mobile phones have evolved through several generations. The first generation (1G) was analogue, and data could only be transmitted very slowly using modems. The current second generation (2G) typically uses digital circuit switched connections for both voice and data, providing only low-speed data (typically around 9.6Kbps).

The term 2.5G describes an emerging breed of networks that use technologies such as GPRS (general packet radio service) to support packet-switched medium speed data (realistically 20Kbps). These provide a much improved application platform with reduced latency, asynchronous applications and the potential for "always on" applications, with data being charged on a per-packet basis rather than a connection time basis. This technology has proved sufficient for many applications.

Most third-generation (3G) networks will not start to be deployed until 2003. They will offer higher data rates (realistically around 64Kbps or better), sufficient for multimedia and other data-intensive applications. The core of a 3G network is likely to be IP (Internet Protocol) based. 4G is still an ill-defined concept, but is likely to involve efficiency improvements and ubiquitous use of IP for both voice and data in heavily connected small cells. The Japanese have already started to define a version of 4G with 10 times 3G's bandwidth, to be introduced in 2006 or later.

It's Time to Greet the Future

The key message is that mobile applications are inevitable, and that they will grow significantly over the next few years to the point where they will significantly impact the way enterprises trade and operate. When considering mobile, think when, not if. Are some of your staff using mobile services now? How can these be leveraged into applications that will benefit the business? What are you competitors doing? What are your customers demanding? Which parts of your organisation could benefit from the application of mobile technology?

To position their organisation to take advantage of this impact, CIOs and IS organisations should take steps now to prepare for the changing demands mobile applications will place upon them.

The most sensible way to start thinking about mobile is to almost ignore the technology and simply list those projects in your business that may benefit from mobility. Then consider the functions available from the emerging mobile technologies and educate your management and users in what is possible.

Concentrate on systems that can be developed quickly (in 90 days or less), and which add enough value for them to be discarded within 18 months. Don't ignore simple and cheap solutions like SMS, or daily PDA synchronisation. And because of the differing state of mobile technology around the world, mobile strategies should be regional, not global.

You can help educate users, tuning their perceptions to a more orderly migration to mobile applications. Position your enterprise's investment so that any early mobile disappointments can be converted into popular business-enabling applications in the medium term as widespread mobile applications take hold.

Partnerships will be necessary because one-stop shops offering mobile technology skills, vertical business skills, localisation and support will be difficult to find. Application service providers, hosting pre-built sites, will offer the shortest time to market and avoid the need to buy "throw-away" infrastructure. You should plan to mix and match mobile e-business service suppliers rather than seeking a one-stop shop that can deliver best-of-breed functionality in all areas, while still taking responsibility for overall program management.

Build to Manage the Risks

Wireless architectures include all the vulnerabilities of Internet architectures and introduce several new risks. Machines such as WAP servers offer new points of attack for hacking. Wireless communications can be intercepted, and shared encryption keys defined by phone manufacturers are risky.

Some mobile devices do not have sufficient computing power to perform long-key encryption. Users may be lazy or confused, and may not operate wireless devices in the most secure manner. Bandwidth and device restrictions also encourage security shortcuts, and SMS provisioning messages offer a new opportunity for hacker attack. Phones and other mobile devices are physically insecure, easily stolen and now match umbrellas as lost items.

Despite these challenges, mobile security is likely to be good enough for a wide range of activities in the short term, although improvements should be adopted as they become available.

Dr Marianne Broadbent is group vice president and global head of research for Gartner's Executive Programs.