The News

Q&A Jean Schmitt 3GSM 2005

24/03/2005

Why is it important for a VC like Sofinnova Partners to attend the 3GSM festival in Cannes ?
3GSM is THE meeting that everybody in the industry attends. If you miss it, you could miss a whole year of business. This year Sofinnova was one of the VCs with the highest visibility at the congress. We had a boat docked in the harbour, which displayed the logos of all our portfolio companies and was clearly visible to all visitors. And we organized two seminars for start-ups, one with Symbian and another with Macromedia.

What did you find most striking about this year’s festival?
Every year there is a fad at 3GSM. In the past it has been location-based series, instant messaging, or the arrival of Microsoft. This year it was clearly IMS, or IP Multimedia Subsystem. This is the infrastructure of the future, bringing new peer to peer services such as push to talk, video calls, and voice over IP. We saw lots of impressive big demos; nevertheless, our feeling if that the market is not yet ready for this. There is still a lot of wishing thinking going on. On the other hand, one clear big trend was the emergence of content. This fell into two categories: the enablers, who make it possible to use image-sound processing technology, and the content providers themselves, who covered all kinds of possibilities, including X-rated material! However we didn’t discover any major innovations in this area. As far as handsets are concerned, the features are pretty well defined now, so we don’t expect any revolutions.

Where do you see the most exciting prospects for investment?
We expect to see breakthroughs in user interfaces. We know there’s a need, and we saw companies with great ideas but none of them had the technology to build a billion company. So people are looking at it and it’s just a question of time before someone comes up with the idea that will be the basis for building a major company.

What were the key take-aways from the Symbian and Macromedia seminars?
Macromedia put into perspective the microscopic size of companies in mobile content, compared to the media companies. From Symbian, we realised that their market share is growing nicel, and that is good for the industry. Some 4,500 application software systems are available on Symbian, which is amazing and shows that when you have a platform you can run real software on it. If creativity is unleashed, you can create a wonderful industry. By the way, we can highlight the same message on Java: Esmertec is shipping every quarter more phones than Symbian – far more than 10,000 Java applications are available on the market today. Esmertec, Symbian and others are creating the right environment for the application software business to grow in wireless. We don’t expect any of these applications to be amazing – they won’t change the world like word processing did 25 years ago – but we expect them to find financing by VCs who are attracted by the business model rather than the technology. Sofinnova could possibly invest in this area, but in general our strategy is to look for patented breakthrough technology.