Welcome back to Baby Breakerdom! This time, our ongoing quest to uncover budding Rule Breakers finds us high on Wi-Fi and tripping our way through Europe.
First up this week is Skyhook, which has created a software alternative to global positioning systems using wireless technology.
Talk about Rule Breaking. Classic GPS systems from Garmin (Nasdaq: GRMN ) , TomTom, and others literally depend on satellites. Skyhook, by contrast, pulls data from Wi-Fi devices to create what it calls a "wireless positioning system," or WPS.
Skeptical? I was, too, at first. But the research is compelling. There are nearly 200 million wireless devices in use today, and every one of them publicly broadcasts a unique marker called an IP address.
What's more, many of these devices are base stations or routers that remain (mostly) stationary. As such, it should be possible to map their locations. That's exactly what Skyhook did. Quoting from the website:
To pinpoint location, WPS uses a massive reference network comprised of the known locations of over 18 million Wi-Fi access points. To develop this database, Skyhook has deployed specialized vehicles to survey every single street, highway, and alley in 2,500 U.S. cities, scanning for Wi-Fi access points and plotting their precise geographic locations. [Emphasis mine.]
I'm sure that took an extraordinary amount of work. And an awful lot of number crunching for Skyhook's "WPS" software. But it still has to be cheaper than launching a satellite, right? I'd say so.
The danger with a Web 2.0 technology like this is that devices move and routers are replaced. What happens when you don't control the infrastructure that allows your system to function? For Skyhook, the answer comes via a process it calls "self-healing," whereby users may calculate their own locations, updating Skyhook's reference database as they do.
I understand that may sound fishy, but partners haven't shied away from the system. To the contrary; NAVTEQ (NYSE: NVT ) , which, like Garmin, is a Stock Advisor pick, teamed with Skyhook in March to bring WPS to the iRiver W10 media player.
And given the crazy speculation over GPS in the iPhone, we can reasonably assume there's a market for just this sort of service via sophisticated smartphones. Apple (Nasdaq: AAPL ) , Nokia (NYSE: NOK ) , and Palm (Nasdaq: PALM ) all seem like natural customers.
Venture investors seem to be thinking the same thing. A week ago, Skyhook announced $8.5 million in private equity financing from RRE Venture, Bain Capital, CommonAngels, and Intel's venture investing arm. Put this one on your IPO watch list, Fool.
Next up is TvTrip, which aims to help travelers by hosting detailed video introductions to top European hotels.
Founded by four former executives of Expedia's (Nasdaq: EXPE ) European division, the premise for the free service is simple: Everyone has had a bad night at a hotel. What makes TvTrip Rule Breaking is how it combines user reviews with its professionally produced videos. (Trip Advisor is a partner site.)
But can the concept make money? Investors seem to think so. Two financiers, Balderton Capital and Partech International, recently provided $4.8 million in fresh capital.
It couldn't come at a better time. According to VentureWire, TvTrip's revenue is entirely derived from commissions from hotel referrals, which means, before the business can take off, it will have to beef up its site significantly. (Only Internet Explorer via Windows worked properly when I tested tvtrip.com yesterday. Firefox frequently experienced problems.)
Nevertheless, there are early signs that TvTrip could become a long-term winner. For example, former Expedia CEO Erik Blanchford has joined TvTrip's board, as has former Lufthansa marketing executive Thierry Antinori. Hilton (NYSE: HLT ) , meanwhile, has agreed to have many of its European cathedrals filmed.
Expect other chains to follow. Hospitality is a cutthroat global business, and there are enough horror stories out there that a service like this should find a niche to support years of growth. Or, at worst, elicit a buyout offer from a travel information supplier such as Fodor's.
For more Rule Breaking Foolishness:
- Check in with our last litter of infants.
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- Check on the latest list of top growth stocks.
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Garmin, NAVTEQ, and Palm are all Stock Advisor recommendations. Intel is an Inside Value pick.
Fool contributor Tim Beyers is a regular contributor to Fool.com and the Rule Breakers team. He owned shares of Nokia at the time of publication. Find Tim's portfolio here and his latest blog commentary here. The Motley Fool's disclosure policy is a rebel on Wall Street.