Presence servers integrated in push-to-talk applications will soon revolutionize the cellular world.

The instant messaging (IM) and presence field is still taking its first steps in the cellular market, but the industry is already talking about a real revolution. While cellular IM's real breakthrough as a significant revenue generator is still in the future, presence servers are already enjoying increasing popularity.

The current strong trend involves use of presence servers in push-to-talk (PTT) applications for preventing cellular network overloads, boosting users' motivation to expand PTT call volumes when the user on the other end is accessible, and transmitting location-based services and contents over PTT.

The first signs of an impending revival in cellular IM was the establishment of the new "Wireless Village" standard, also known as the mobile Instant Messaging and Presence (IMPS) initiative, which is intended to integrate IM capabilities into the latest cellular devices.

When Nokia joined the revolution by launching telephones with IMPS capabilities, the writing was on the wall. Other manufacturers, such as Sony-Ericsson, Siemens, NEC, and Samsung, soon followed.

An estimated 30% of all new cellular telephones currently reaching the market are equipped with IMPS capabilities. The main parameters on which evolution of the IMPS market is based upon, are cellular devices that support advanced standards like Wireless Village, and cellular devices with open operating systems, such as Symbian OS, Microsoft, and J2ME, which include IMPS software.

Nevertheless, cellular IM usage is still confined to early adopters, and traffic volumes are still negligible. It is unclear why operators are making such slow progress on instant messaging.

But while significant cellular-IM breakthroughs continue to be delayed, the presence servers in cellular networks are making giant steps forward. This trend raises the question of what advantage do presence- servers provide the cellular industry. As it happens, the first advantage is the automatic update of the cellular-IM user's status. While Internet IM users must de- fine and update their status ("busy", "at a meeting", etc.), the presence servers ensure that the cellular user's status is constantly and automatically updated.

Moreover, presence servers are installed in the cellular network, and provide a long list of additional important particulars collected from the network itself, such as whether the recipient's telephone is "on" or "off," what is his location, whether he is in an area covered by GPRS, 3G, or voice networks, whether his phone can receive only SMS messages, or it can also receive Java-data, etc.

Until recently, presence servers were used mostly for IM, but their advantages are not confined just to IM. Another advantage of presence technology has lately been seen in the Push-To-Talk field. The great popularity of PTT has highlighted this unanticipated aspect of presence servers. There are a number of reasons for this. First of all, notification of the recipient's status triggers PTT service use.

Secondly, every click on the PTT button is transmitted to the network and creates traffic, even when the user on the other end is inaccessible. If users are unaware of the recipient's (i.e. receiver's) status, they click on the PTT button regardless of the chances to receive a response. Since every button clicked puts traffic on the network, unanswered clicks overload the network, while producing no revenue for the operator.

Presence servers solve this problem. If the recipient is inaccessible, or unavailable for a call, the server sends an instruction not to transmit the click to the network.

Another advantage of presence servers in cellular networks will be its connection to location based services systems. This should boost the LBS field, since it will allow the network to integrate information on the user's location, availability, whether he or she is in an area covered by GPRS, 3G, or voice networks, what the capabilities of his device are, etc.

The increasing emphasis on presence technology begs the question: why is the big breakthrough in cellular IM being delayed? After all, there is no need to develop new technologies or educate the market. Convenient interfaces and user communities are both available, and there's great potential for increasing traffic and revenue. There's money lying around. All that's needed now is to pick it up. But it's not happening, and it's not clear why.

One reason might be that there are few IMPS-enabled phones. Another reason may be that cellular operators have lost valuable time in trying to bypass the major Internet IM communities (e.g. AOL) and have been too inflexible in their revenue sharing deals with them.

In any case, the major Internet IM communities are ready now to cooperate with cellular operators. They know that connectivity and revenue sharing agreements will enable them to charge for messages transmitted to cellular networks. At the same time, cellular operators are also increasingly willing to allow IM connectivity between different cellular networks.

A third possible reason for the delay is that until about a year ago, wireless communications was not as common in the US as in the rest of the world. As a result, the major Internet IM communities did not take cellular IM seriously. Since the US has the world's largest IM market, the entire sector has been affected.

Now, after cellular penetration in the US has made great strides, the major IM communities have realized that they cannot ignore this market's business potential. Still, as of now, the only community that has managed to sell services to several dozen cellular operators is ICQ. Only in the past few months have the other three communities taken their initial steps in this direction.

Another obstacle hampering the cellular IM sector is the major IM communities' unchallenged control of the market. Apart from servers and software in telephones, IM needs a user community. In recent years, the major cellular operators have tried to establish independent communities with private brand names, such as Vodafone Messenger.

Will cellular IM communities ever rival the Internet communities? Thus far, it seems that the large Internet communities control the market, and the cellular communities have failed in their attempt to found independent communities. It appears that any cellular community will inevitably be overshadowed by the Internet IM communities, which will continue to handle most activity.

In other words, until cellular operators devise a comprehensive substitute for Internet communities, cellular communities will be relegated to an inferior position.

"The large IM Internet communities have the largest global market share," says CTI Squared's CEO, Erez Marom. "Wireless operators seeking profits from IM will have to link their subscribers to the IM internet communities, rather than trying to educate them to use a new system. They have to provide users with an 'extension cord' to the Internet, which will enable users to continue working with the communities they're used to, outside their home or office."

On the other hand, there are some who attach great importance to the current trend towards interconnectivity between cellular operators and Internet communities, and to the fact that more and more operators are trying to reach cooperation agreements for connecting their IM systems. This view holds that cellular operators will be able to maintain successful independent communities, which will coexist with Internet communities.

In any case, Internet-to-cellular traffic now exceeds cellular-to-cellular traffic. As a result, most providers of IM and presence systems, which are designed for cellular operators, currently position themselves as presence systems providers.

The Israeli IM industry includes several system providers: Comverse offers cellular operators IM systems which include a 'charging gateway,' through which IM messages between cellular operators and Internet IM communities are transmitted. The charging gateway informs cellular operators of which payments from an Internet community they are entitled. One of the competitors in this field is a Canadian company, OZ Communications, which operates mostly in North America.

An Israeli company, Followap Telecommunications, provides IMPS systems designed to create cellular communities for operators. Followap works in cooperation with PTT systems vendors in order to connect its presence servers with PTT servers.

Another Israeli company, CTI Squared. provides a next-gen Messaging Platform, which integrates with IM services. The platform communicates with the operator's IMPS services. It includes notification and delivery of messages via IM (e.g. notification of incoming voicemail sent as IM), presence status and management of message delivery or notification rules based on presence status. In addition, the system provides APIs that can be used by an IMPS service for sending outbound messages (e.g. SMS messages), setting up voice conferences, management of voice calls, etc.

Finally, yet another Israeli company, MessageVine, offers access servers designed to provide cellular users with simultaneous access to all the Internet IM communities.