Onavo, Saving Surfers Money on Big Business's Dime

Gluttonous apps were its meat and potatoes as surfers sought ways to economize. Then it had a new idea

Inbal Orpaz
Inbal Orpaz
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Inbal Orpaz
Inbal Orpaz

The public first became aware of Onavo as an application to lower their mobile surfing bills. But annoyed consumers tired of paying through the nose were just the start of this startup's story.

That began when Onavo co-founder Guy Rosen's brother went to Barcelona, and then was hit with a huge cellular bill.

In April 2011, Onavo launched Onavo Extend, an application that both identified "gluttonous" applications in terms of data consumption, and which compressed data in order to reduce the appetite of these greedy applications. Onavo thusly helped mobile surfers save some 80%.

Back then, in the dim history of two years ago, mobile operators constrained mobile surfing packages, and data consumption cost an arm and a leg. The Onavo technology was particularly useful for people taking their smartphones with them on overseas trips, who wanted to reduce the high cost of “roaming."

That technology reflected experience acquired by the company’s founders, Rosen and Roi Tiger, while serving in an Israeli army intelligence-gathering unit. When the application is installed, Rosen explains, the cellular phone connects to the company's data-compression service,which is located in the cloud (that is, in the company’s cloud-based storage system, rather than in the user’s cell phone). After the application’s installation, every time users need data, it gets compressed in Onavo’s cloud-based system and then transferred to the user in a compressed and “lighter” form. Thus, users can expand the utilization of their surfing package five times over.

The application, which has been installed by millions of users in their cell phones, can be downloaded for free. Onavo openly explains that it wants to attract a large number of users who will become “addicted” to the application and to then charge a monthly user’s fee.

Meanwhile, the word was going around in tech circles that, quietly, Onavo was developing a very different kind of product that would generate shock waves in the market. Sure enough, in February the startup unveiled Onavo Insights, which ranks popularity and use patterns for smartphone applications.

And now one for the companies

This one isn't for the consumer. It's a boon for mobile data companies - game developers, application developers, advertising networks, you name it.

The database that Onavo has created relies on data collected anonymously from users who installed the application in their phone (to save, as we said, on data consumption costs.

What data can Onavo Insights present to clients? For instance, how many smartphones in America downloaded an app - or, in other words, how popular the app is compared with the competition; retention rates; and so on.

While the free service includes data on iPhone applications in the U.S., the service for which clients pay includes data on applications based on Apple’s iOS operating system and on Android’s operating system in dozens of countries.

Many technologies can track an app's downloads, but they can't answer the question “How many people actually use this application?”

Onavo can, thanks to the service it offers to cellular phone users. It can also supply figures particularly relevant to advertisers and mobile developers, including engagement data on rival applications, effectiveness rates for cellular campaigns and analyses of cell phone use.

The average annual cost for Onavo Insights subscribers is $100,000.

Thus Onavo now has two types of users: everyman trying to save costs and companies using the data of everyman to gauge themselves and the competition.

Its business model is based on the revenues it receives from the users of its business service. Google and Facebook have similar models, the firm points out.

Onavo has raised $13 million including from Li Ka-shing’s Horizon Ventures fund, Motorola, Mobility Ventures, Sequoia Capital and Magma Venture Partners.

Consumers feeling they're drowning in costs can save, at least on mobile surfing.Credit: Marina Zlochin
Onavo founders Guy Rosen, left, and Roi Tiger.Credit: David Bachar

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