Press Release: June 28, 2000

WR Hambrecht + Co Issues eWireless Industry Report

eWireless surveys the wireless Internet landscape

San Francisco, CA, June 28, 2000—WR Hambrecht + Co today announced it issued a comprehensive report on the rapidly expanding eWireless industry. The report examines the companies and technologies that enable the wireless Internet, including wireless Internet infrastructure, wireless data networks, wireless Internet service providers, wireless Internet portals, and wireless data solutions providers. eWireless: Enabling the Wireless Internet is available on WR Hambrecht + Co’s web site at www.wrhambrecht.com.

WR Hambrecht + Co’s eWireless analyst Peter Friedland predicts that the wireless Internet will emerge as a valuable tool for consumers, enterprises, content providers, and wireless network operators. “We expect subscribers to use the wireless Internet to perform targeted searches for time-sensitive information,” Friedland said.

Over the last 12 months, the wireless Internet has sparked a tremendous amount of attention from investors. The average 1999 gain for wireless Internet stocks in WR Hambrecht + Co’s “Mobile Wireless Data” group was 1,221 percent, versus an 86 percent increase in the Nasdaq. Even with recent market volatility, the group is still up 25 percent for the year, versus a 3 percent drop in the Nasdaq.

The report focuses on six categories of companies that enable the wireless Internet:

• Wireless Internet Infrastructure - The report outlines the development and implications of Wireless Application Protocol (WAP) as a standard for wireless Internet transmission to mobile phones. WAP was designed to solve: 1) wireless data transport issues, such as limited bandwidth and intermittent network coverage; 2) presentation issues, such as the small screens of wireless devices; 3) data input issues, such as the lack of QWERTY keyboards and mouse functionality on wireless devices; and 4) limited memory and power resources on wireless devices.
• Wireless Internet Service Providers (WISPs) - The report asserts that wireless carriers are positioned to be the dominant WISPs because they control the wireless networks, which are a scarce asset.
• Wireless Internet Subscribers - The report estimates that the current U.S. wireless Internet subscriber base of roughly 500,000 will reach 10.2 million in 2001, representing 8% penetration of total U.S. mobile phone subscribers. Migration to High Speed Wireless Data Networks - The report discusses the migration toward packet data transmission, which should offer more bandwidth for high speed wireless Internet services to mobile phones, handheld devices, and laptops.
• Wireless Internet Portals - The report discusses the differing strategies of Sprint PCS, currently offering access to incumbent portals such as AOL and Yahoo!, versus other wireless carriers that have chosen to offer carrier-branded wireless portals. Friedland asserts companies like InfoSpace and Phone.com, which provide wireless portal platforms for wireless carriers, stand to benefit.
• Wireless Data Solution Providers - The report outlines the specific complexities of implementing wireless Internet/data services including: multiples form factors of devices, unreliable wireless networks, limited bandwidth, maintaining network security, and the evolution of new coding languages required to create wireless data applications. A class of companies called wireless data solutions providers has emerged to contend with these issues, which can be broken down into three categories: wireless data middleware providers, wireless application service providers and wireless data application developers.

The report offers profiles of 11 public and 16 private companies in the eWireless industry.