Pando

How a 2G feature phone can outperform an iPhone

By Hamish McKenzie , written on April 30, 2013

From The News Desk

Last week, I wrote about an Australian entrepreneur who sold an ad-serving company to 25/7 Media for $75 million only to see its value evaporate in the dotcom crash. He then built up a search engine marketing company that he eventually also sold to 24/7, this time for $30 million when the Internet industry was in recovery. In that post, I mentioned that Gour Lentell was also working on a new startup, biNu, which offers an app platform that gives feature phones smartphone-like functionality.

We've written about biNu a couple times before, noting first that it raised $2 million from Eric Schmidt's Tomorrow Ventures and others, and then that it raised a Series A of $4.3 million from 500 Startups and PanAfrican Investment Co.

Veteran entrepreneur Lentell, who is based in Sydney but was born in Zimbabwe, got started on biNu after he and co-founder bought the intellectual property from an Australian inventor who had developed it based on paging technology. The tech allows biNu to deliver Internet-connected apps to feature phones. The apps perform with such speed and efficiency on even 2G connections that it's just like they are operating on 3G connections or higher. Indeed, recent side by side comparisons showed that a Google search via biNu was sometimes faster than the same search performed on an iPhone or Android device.

BiNu is focused on emerging markets in Asia and Africa in particular, where smartphones aren't as widespread as feature phones, and where consumers care about keeping data costs as low as possible. In its first year, the app platform had 300,000 active users per month. That number shot up to 3 million the following year and now sits at 5 million.

While biNu has built standard apps for Google search, Facebook, Twitter, and news sites, such as the New York Times, for the platform, it has also opened up its API to third-party developers, which could be a future source of revenue. It also recently signed a deal with Mills & Boon romance books publisher Harlequin to let biNu users read entire books on the pokey little screens of their feature phones. The company has also launched biNu credits, which lets users buy premium items through the platform, including international SMS. While the credits are also key to biNu's business model, the company may find it hard to convince consumers to pay for services as simple and abundant as SMS, especially given that the likes of WhatsApp offers such messaging for free.

BiNu will also face a challenge to its core business as cheap Android devices increasingly find their ways into the hands of consumers in the developing world, making more of them smartphone owners. However, Lentell believes biNu can be important on Android, too, because connectivity in many parts of the developing world will continue to be too spotty to support a good online user experience for smartphone apps. He also thinks that the transition from feature phones to smartphones will take a while in the developing world.

To best get a sense for what biNu is all about, you have to see it in action. So while sitting in a Sydney cafe last week, I got Lentell to give me a quick demo of how the app works. Here it is.