18-24 months back, carriers in Western Europe and North America were oblivious to the world of mobile search. Not many people paid attention. Things started to change in late 2005 when Mobile Search was the hottest story of the day and when linked with Mobile Advertising, it smelled $$$$. Last year, carriers organized themselves internally to take position themselves to take advantage of this opportunity. They clearly have the customer relationship but do they have the might to make it happen. Will Google and Yahoo eat their lunch? How soon will that happen?

There are some news reports that carriers are exploring partnership to maximize their potential revenue stream. Telegraph is reporting that Vodafone, France Telecom, Telefonica, Deutsche Telekom, Hutchison Whampoa, Telecom Italia and one American network, Cingular, are among the companies that will come together for secret, high-level talks at the mobile industry’s biggest annual trade show in Barcelona next week. If you would notice, the consortium consists of one large carrier for a major geography. Can Verizon and Cingular have the same search engine and differentiate. Yes, they can but boy! will the administration of the technology and business be a nightmare.

While it is a sound business strategy that should be explored, in practice, such consortium-based anything rarely work. Reason is simple, everyone has their own agenda, too many cooks stirring the pot and while they will be tied up squabbling, someone else will innovate and show the way.

Can carriers really control the handset and innovation for ever? Clearly not. The question is for how long will the iron-grip last. The choices that are made in the next 12 months will have a 4-5 year impact on revenues. Initially, Google and Yahoo thought, they don’t need carriers, they hate carriers, but slowly have started to realize – it is NOT the Internet world and it will take a carrier partner to tango in the near-term. They have even started offering white-label services, a thought laughed-off at not too long ago. But, cozying up is only a short-term strategy, they NEED reach, they need access to consumers so that they can expose their technology to them ..

It will be an interesting cat-and-mouse game for the next several months, as the value chain participants arm-wrestle for a profitable vista.