November 14, 2006 By Sarah Jane Tribble
In a partnership that could herald a new era in social networking, Palo Alto, Calif., start-up loopt plans to launch a new service with Boost Mobile, one of the nation's biggest youth-oriented wireless phone companies. Boost's 3.8 million customers -- who are mostly under 25 -- will be able to create groups of friends and keep track of them using a combination of text messaging, pictures and the GPS technology embedded in most new mobile phones today.
"Historically, that MySpace generation has been connected to the personal computer and the personal computer only," said James Brehm, wireless analyst with Frost & Sullivan. "This is the next step and it's a giant leap, (because) it allows you to do it on the move."
For Boost -- and possibly its parent company Sprint Nextel -- the loopt service means an advantage over other carriers by giving customers another reason to join, buy new phones, or sign up for more minutes. For loopt, which has 17 employees, the deal means its first commercial success since getting $5 million in funding earlier this year from venture capital firms like Sequoia Capital -- which backed Google.
Loopt founder Sam Altman, a 21-year-old who left Stanford University's computer sciences program last year to start the company, said more wireless companies are expected to offer what he calls "social mapping" early next year. He declined to identify carriers.
Of the nearly 220 million wireless customers in the United States, many of the most avid users of new features like ringtones, callbacks and text messaging are the same 14- to 25-year-olds who use social networking Web sites. Yet mobile phone companies have struggled to create a way for people to network.
Downloadable services like dodgeball.com and Loc-Aid.net have attempted to fill the void, offering text-messaging groups that work with zip code location technology. But analysts said the efforts have stumbled, in part because they lacked the ease of the interactive map that is part of loopt's service.
"Young people are really into this social networking and providing location information is just taking it to the next level," said Phil Leigh, senior analyst for Inside Digital Media. "It really is something that's going to fit a need."
Wireless research firm Telephia reports that most of the mobile networking applications have too small a user-base to track, but the latest data does indicate a desire to use mobile phones as social networking venues. About 1.4 million mobile customers logged onto MySpace using the wireless Web in September, according to Telephia.
Nitin Khanna, Boost's product manager for value-added services, said young people are asking for more ways to use their phones.
"This is the right solution, the right partner, and the right time," he said.
Loopt's service has a colorful Mapquest-like graphic that updates every 15 minutes to pinpoint friends and indicate whether they are available to talk or text. The map also shows small photos and text messages like "busy, busy" for the friends it finds, and gives users the option to call, text message or send a picture to them.
Since launching a beta test without promotion or advertising on the Boost site six weeks ago, loopt has signed up more than 30,000 users.
Mark Jacobstein, loopt's executive vice president of corporate development, said the widespread availability of GPS service on phones is the key technology that makes loopt work. In addition, he said, loopt has strict privacy and security safeguards, including requirements that friends must be invited and accept each other. To prevent mobile popularity contests, the number of friends is limited to 150.
"We're trying to deepen relationships