Smith Micro Bags Sprint

Gadget fans say the success of Apple's iPod was built on its simple and effective music management software. This is an area where cell phones have suffered and outfits like Apple stand to make considerable improvements.

"Sprint and Verizon are going to get more aggressive to compete with AT&T's iPhone," says Rich Church, referring to the June arrival of Apple's iPod-inspired mobile phone.

To date, most of the phone companies have required customers to handle most of these tasks using the phone companies' software. But critics say the services have been lacking. Verizon Wireless, for example, runs VCast, a media store accessible by PC or cell phone. Songs can be downloaded to phones for $2. But users have to download the song again if they want it on their PCs. Now, with the Music Essentials kit, users can sync songs on both devices.

Analysts say Smith Micro gives telcos a music tool to tune up for the competition.

On a conference call with analysts, Smith Micro CEO Bill Smith said Apple's influence on the market would be good for his company.

"It has been very intriguing to watch some of the comments coming out of Sprint with regard to how they view the iPhone and Cingular's launch," Smith said. "Obviously it's going to create a buzz, and that's very, very good for us."

Smith Micro shares were down $1.02, or 6%, to $16.77 Friday.

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