SmartServ and HP Board Wireless Trading Bandwagon
By Cindy Christ

Web and wireless application service provider SmartServ Online and computer giant Hewlett-Packard are linking up to develop a wireless stock trading system with direct access to all of the world's major exchanges.

The two announced Friday they'll create an always-on, global network offered through data hosting centers in every major financial hub worldwide.

The system will provide real-time news, quotes, and trade execution and transaction processing from any Web-enabled wireline or wireless device, including PCs, cell phones, and Palm and Windows CE appliances.

Financial terms of the deal weren't disclosed.

Deployment of the platform, which also will support electronic commerce, is expected to be "rapid," the companies said.

Under the alliance, Hewlett-Packard will provide computer hardware, e-commerce technology, financing, co-marketing and consulting support. SmartServ will provide wireless applications and hosting services.

"We look forward to the day when a businesswoman in Europe or a man on vacation in the Caribbean will have consistent, powerful access to global markets using SmartServ and HP's combined solution," said Dave Scantling, general manager for HP's E-Services Solutions.

Shares in SmartServ (SSOL) dropped despite news of the alliance, falling $4.69, or 5.8 percent, to $76.13.

Hewlett-Packard (HWP) rose $2.13, or 1.7 percent, to $128.

Recently, leading brokerage houses and fund managers have been falling over themselves to develop untethered access to trading as the financial world gears up for the wireless revolution.

Market analysts estimate that over the next few years, wireless devices will transact 35 to 65 percent of all online trades.

According to the Tower Group, by 2005, 1.7 million people will funnel trades through wireless phones and 4.2 million will use cordless devices to check stock quotes and news.

Outside the United States, the market potential is even greater in countries where mobile appliances vastly outnumber PCs. It's estimated that at least 40 percent of e-commerce transactions outside North America will be initiated from wireless devices by 2004.

On Monday, No. 1 online and discount broker Charles Schwab (SCH) launched its PocketBroker wireless service for Palm Pilot users, noting that wireless transactions could comprise up to 5 percent of its trades by yearend.

Schwab formed an alliance with wireless data products and services company Aether Systems (AETH) to co-develop the service and provide network connectivity.

Schwab rivals Quick & Reilly, E*Trade (EGRP) and TD Waterhouse (TWE) also offer wireless trading.

Fund behemoth Fidelity was first to market with a cordless trading system in January 1999. In the first year, the number of wireless subscribers mushroomed from 2,100 to 27,566 and more than doubled again to 63,150 through the end of last month.

"Wireless is where customers will be. The adoption curve is moving straight up," said Tracey Curvey, executive vice president of Fidelity Online Brokerage, according to Investor's Business Daily.

While experts are upbeat about the growing popularity of wireless trading, the cost may put some investors off - Schwab's PocketBroker service runs $55 per month plus $300 to $500 for a Palm computer and $29.95 per trade.

Investors also may worry about security and the spread of viruses to cell phones and handhelds.

Still, business, like nature, abhors a vacuum. And if companies like Symantec Corp. (SYMC), which yesterday unveiled the world's first anti-virus technology for the Palm operating system, are successful, more and more investors may unleash themselves from the desktop proving you really can take it with you.