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Start-Ups to Watch: DataMi Transforms Wireless-Internet Bills

This article is more than 9 years old.

What’s your unique technology? What’s your business model? Most emerging companies are fortunate if they can come up with a cutting-edge answer to one of those questions. But DataMi – a Boston-area startup focusing on better ways of managing wireless Internet service – is breaking intriguing new ground in both these arenas.

I visited DataMi’s Chelmsford, Mass., headquarters in August to meet with the company’s chief executive officer, Harjot Saluja, and his engineering team. He’s a former executive at cell-network equipment maker Airvana, who joined Datami in August 2013. Since then, he has hired more than a dozen employees in the U.S., India and South Korea, in addition to negotiating a variety of partnerships and helping DataMi raise $6 million in venture capital.

DataMi’s origins trace back to academic work done at Princeton and other universities, establishing proprietary technology that lets wireless carriers respond to user behavior with time-dependent pricing.  Those patented initiatives were led by Princeton electrical engineering professor Mung Chiang, who serves on Datami’s board. In a new book, "Smart Data Pricing," Chiang and three co-authors explain how this technology could lead to new business arrangements for wireless carriers, consumers and others.

Cell phone tower (Photo credit: Wikipedia)

Together, Saluja and Chiang set out in 2013 to get DataMi up and running. As Saluja explains, the company “offers solutions to enterprise customers that streamline and improve billing responsibility and cost controls for cellular data.” DataMi is targeting two main use cases: employees who use their phones for work, and enterprises that want to cover consumers’ costs in accessing certain types of data.

Gaining traction in the first area, DataMi and Good Technology, a Sunnyvale, Calif., company specializing in secure mobility, announced in July that they will offer  employers a hassle-free way of sorting out employees’ personal cell-phone bills, so that business-related usage would be reimbursed according to actual bandwidth consumption rather than rough estimates.

DataMi’s technology makes it easy to split employees’ mobile-phone bills. Work-related applications such as email and sales-productivity systems can be distinguished automatically from whatever free-time applications an employee might access. Employees who use their smartphones a lot for work might get big reimbursement checks. But – as is more often the case – if employees use less than 10% of their data plans for work-related apps, the split-billing system could be a meaningful money-saver for corporate clients.

DataMi had briefly considered looking for ways to develop the split-billing market on its own. But that would have required negotiating lots of agreements, one at a time, with corporate customers. Saluja says it made far more sense to partner with Good, which already has strong relationships with many big enterprises looking for better ways of sorting out their employees’ mobile bills.

Lately, DataMi has been bringing a second business concept into the marketplace, too: providing a way that mobile users can tap into certain types of digital content free of charge, without impacting their data-plan limits.

DataMi entered this arena in July by partnering with Trove, a digital-news aggregator, and AT&T. Together, they have developed a  “zero rating” approach that lets many AT&T wireless customers call up articles via Trove, without needing to pay the usual data charges. Instead, any costs are absorbed by Trove and its business partners. In effect, Saluja says, this product “parallels what newspapers and magazines have done for years, which is allow advertising to cover delivery costs of content.”

More recently, DataMi launched a sponsored podcast on Slate. It also is getting ready to launch sponsored-data programs in Africa and India in the first week of November. These could help millions of subscribers, Saluja says, because mobile users who might have trouble on their own paying for media, educational or work-related data can now gain free access to such content when other funders are willing to pick up the tab.

Overall, Saluja sees such alliances as “creating a revolutionary new use case for advertising.” Many digital content providers are eager to reach more readers or viewers – and currently lack means of promoting their offerings. Embracing something like DataMi’s zero-rating approach would make it easier for them to boost their audiences, while also potentially lowering the public’s overall costs of mobile connectivity.

In keeping with its big ambitions, DataMi has attracted a wide range of high-profile backers. Its advisory board includes Reed Hundt (former chairman of the Federal Communications Commission), as well as Marcus Brauchli (former editor of The Washington Post) and Strauss Zelnick (founder and CEO of ZelnickMedia.) In addition to Princeton's Chiang, DataMi's board of directors includes investor Jeff Samberg; Vijay Ravindran (chief digital officer of Graham Holdings);  and Wim Sweldens, cofounder and CEO of Kiswe Mobile.

Saluja sees more ways that DataMi’s technology can be applied. Among them: businesses wanting to do micro-targeting of potential customers in specific locations can use DataMi’s technology to “leverage mobile data as ad technology in a matter of minutes. “