THE BLOG

The Anti-Virus Battle Inside Your Smartphone

12/13/2011 10:43 am ET | Updated Feb 12, 2012

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As we all walk around talking, texting and surfing on our expensive little computers, we're oblivious to the external threats which may maim or destroy these work necessities. There are literally billions of malicious URLs, texts and other intrusions which can take out our communications at any moment.

And, we're equally oblivious to all the software technology which invisibly protects us 24 hours a day. It is truly an 'invisible black-box' type technology that none of us -- industry people and programmers aside -- understand or want to know about because as long as we don't know about all the threats and the software that protects us, we're OK.

Enter NetQin. (Known as NQ Mobile after January 2012.)

NQ Mobile provides mobile security applications: anti-virus, back-up and anti-theft protections, mainly. They are one of those kinds of smaller companies competing with the big boys which I like so much; the underdog. Unusually, NQ Mobile is publicly traded on NYSE (NQ) while having relatively modest revenues.

Think about it: there are the usual big corporations who like to control production of this important protection.

You have software security experts such as McAfee, Norton, Symantec and Kaspersky whose business it is to make the protection, the software.

Then we have the mobile phone OEMs themselves like Apple, Motorola, Nokia, HTC, LG, Samsung, Blackberry and others who have a vested interest in providing the most secure phones to customers (as Blackberry does to government).

And finally, there are the big telco wireless carriers like AT&T, Verizon, Sprint, T-Mobile and others who have a real business need to protect their far-flung and intensely expensive business networks from decentralized attack through the millions of handsets that expose them.

So is there really a place for a small company to compete in this space? I think so.

Chris Stier is the NQ Mobile Managing Director Americas and he sat down with me recently. Stier says he's a "Brazilian/American" and was a Motorola executive for more than 15 years, so he knows his way around the mobile phone industry.

"Phones are more vulnerable than PCs," Stier says, "and by 2013 we expect more people to be browsing on phones than PCs. What we're doing at NQ Mobile is offering a PaaS (Platform as a Service) for our customers, whether they be the wireless carriers, phone manufacturers, OS providers or users of smart-phones just like you and me."

The NQ Mobile offering includes its flagship Mobile Security; Mobile Productivity; and Intelligent Cloud Services suites.

The 'old name' NetQin, pronounced "Net-Chin," stands for "unifying the Internet" according to Stier and the "Qin" part comes from the Qin Dynasty in China. It was during the Qin Dynasty that the workforce in China was so organized that they built the Great Wall of China during this period -- making this an apt name for a security software company.

Though founded in China in 2005, Stier tells me NQ Mobile "has absolutely zero ownership by the Chinese government." Backed by some real forces in private-equity, venture capital and technology such as Sequoia, Mayfield, Fidelity, Qualcomm and HTC, the Chinese Android phone manufacturer, NQ Mobile seems to excite all the right investor minds.

In terms of partners, NQ Mobile also has an impressive list. They work hand-in hand with the OS world of RIM, Symbian, Microsoft and Android but because of the proprietary nature of Apple's iOS source code -- there's a surprise -- no anti-virus company can make an anti-virus product for the iPhone. But this doesn't dissuade the feisty, upstart NQ Mobile, who has been producing productivity tools and such for the iPhone.

Telecom partners include China Mobile, China Telecom and China Unicom while other various partners are the usual suspects like Motorola, SonyEricsson, HTC, Nokia, Huawei, Qualcomm, Samsung and Lenovo.

Stier's mandate is to expand NQ Mobile in the Americas but particularly the U.S. market. Though little-known here in America, NQ Mobile owns a dominant 68 percent of the mobile security market in China, according to Frost & Sullivan.

The company now has over 400 employees globally and anticipates 2011 revenue of $40 million.

So what precisely does NQ Mobile offer?

They provide what's referred to as "Mobile Security" to over 123 million users globally; up more than 100 percent from 60 million NQ Mobile customers last year. Mobile Security translates to four main areas: virus scan; back-up; anti-spam; and anti-theft. NQ Mobile's expanded their protection to offer some interesting options like "parental controls," which allows the parent of the user to control and filter out nasty sites based on age and sex of the child as well as use GPS to locate your child in the event of an emergency.

"At NQ Mobile," Stier began ominously, "we've got more than 1 billion malicious URLs in our database and we're discovering more than 30 entirely new threats every day. Next year, it's expected that there will be more than 30 billion downloads." Stier also tells me that NQ Mobile has more than 30 patents.

NQ Mobile competitors are fierce: McAfee, Symantec, Lookout, F-Secure, Norton, Sybase and many others with a stronger brand name, more customers on other computing platforms migrating to their mobile product and deeper experience in the USA than NQ Mobile.

But if there's a significant advantage that NQ Mobile has it's the huge base of users outside of America -- something none of the other security big-boys have. While Norton or Symantec may have to spend millions to create their mobile brand in Asia, NQ Mobile already dominates that market and has now turned its attention to the America's through Chris Stier.

Additionally, NQ Mobile is known for only mobile security software, not the whole litany of evolutionary software beginning with the desktop and having to morph through each different computing form-factor -- allowing NQ Mobile to claim 'expert focus' on only mobile security. "When NQ Mobile was first started," Stier chimed in, "smart-phones were just starting to pervade in China, so we were there at the inauguration."

Another huge marketing advantage that NQ Mobile enjoys as it strives to obtain U.S. market-share is the strong relationship (investor and partner) with HTC. This relatively new, up-and-coming Chinese brand which has blown by Apple in smart-phone sales with its Android product line has accomplished a lot in terms of representing a Chinese brand in America with a higher quality image.

Meanwhile, Stier, ever confident about the strength of NQ Mobile's security product, is very excited about the productivity software the company already has on the market in China. "Our 'Smart Calendar' and 'Nice Day' productivity apps are both in the Top 5 downloads in China," he said beaming.

I've been wrong so many times before as I stick my neck out in all things technology. Nobody really knows how things will shake out in these nascent, embryonic niche markets, but if I had to guess, I'd say NQ Mobile will be a long-term player in this area for years to come.