You see it in almost every promotional video for the new generation of mobile phone technologies. A busy executive opens a laptop computer, presses a key and instantly receives a file from the internet via his mobile phone network.

Mobile phone systems such as GPRS (General Packet Radio Service) and UMTS (Universal Mobile Telephone System) or 3G, promise a new world of telecommunications with faster, always-on connections. These will allow anyone using a mobile phone, PDA or laptop PC to connect to the internet or a corporate intranet quickly and easily.

In reality, however, wirelessly connecting to the internet could still be a slow and frustrating experience, even with 3G.

But a series of revolutionary technologies developed by a small Icelandic company is transforming the mobile data market. The company, Netverk, has produced software and server-based solutions that can increase data speeds on a mobile phone network by up to 25 times. Mobile phone networks can also increase their data capacity by a factor of two.

Little wonder that over the past three years, Netverk has attracted almost $30m of equity funding from institutions such as National Bank of Iceland and Citicorp Asia. It has also attracted a string of high profile telecoms customers including, Vodafone, BT Cellnet, Tele Danmark and Hallo/Mint.

Netverk is headquartered in Reykjavik and has offices in London, Copenhagen and Hong Kong. It is privately owned and has 76 employees.

Holberg Masson, its chairman and chief executive officer founded Netverk in 1993. Mr Masson, whose background is in the telecoms and computer industries, originally wanted to develop an efficient system for sending e-mail via satellite for Icelandic and Russian fishing fleets.

In 1997, Netverk decided to develop its technologies to improve mobile phone networks. Mobile phone networks suffer from two major problems when compared with fixed-line networks. One of these is speed, especially when data files are being transferred. The second is latency, the time gap between pressing a send button and the recipient receiving the data file.

To solve these problems, Netverk has developed data compression, transmission and protocol technologies, which are software-based and do not require mobile phone operators to invest in new network infrastructure.

Netverk's products include FoneStar, a system developed for GSM and GRPS data communication: "Speed is the missing piece in the GPRS jig-saw puzzle," says Jason King, Netverk's marketing director. FoneStar uses file compression and transmission techniques to increase file transfer speed, saving time and reducing the risk of data being lost or corrupted.

BT Cellnet plans to offer FoneStar on its GPRS service and Tele Danmark is using Netverk products on its GSM and GPRS networks. Netverk has also developed a version of FoneStar for Internet Service Providers (ISPs) to improve dial-up connections.

Another Netverk development is mTCP (mobile Transmission Control Protocol), driver software which sits on a mobile phone network and improves speed and reliability. Computers use TCP technology to send data over the internet, but as Mr King notes: "TCP was designed for fixed systems and not mobile applications. mTCP will replace TCP in the mobile arena." Another Netverk product improves email links on Wap (Wireless application protocol) phones.

Netverk makes its money from providing telecoms customers with software, services and support, and telecoms companies charge corporates for the use of the technology. The arrival of always-on connections has forced telecoms companies to adopt new pricing structures. Older dial-up networks charge by time, but GPRS and 3G users will be charged in other ways. Mr King does not think that charging by the amount of data customers use is a good idea: "Charging by the megabyte is not good, because that is not how we think about buying airtime. A better system is a fixed, monthly flat fee."

Although Netverk has a base in the Pacific Rim via its Hong Kong office, the company has initially focused on the European market. But the company plans to move into other territories: "Europe is ahead of the rest of the world when it comes to mobile phone usage, but the picture is changing. The US is catching up fast and this will be an important market for us."

The Japanese market is dominated by NTT DoCoMo's i-mode internet phone system, so could Netverk's technology be used to improve i-mode's performance? Mr King says Netverk would welcome the opportunity to work with NTT DoCoMo, but adds that the uptake of i-mode in Europe might be difficult as European consumers are not used to using small wireless devices for gaming and entertainment.

The concern over the high price paid by European operators for their 3G licences ($92bn/£66bn was paid in auctions), could help increase the take-up of Netverk's solutions, says Mr King: "The companies will be looking to recoup their investment as quickly as possible and our technology can help."

Netverk's technology is so innovative that this year, the World Economic Forum selected Mr Masson as one of its Top 100 Technology Pioneers for the 2001. But although Netverk is currently ahead of the game it faces fierce competition in this sector. Nokia and Ericsson plan to build technology into their handsets that will improve data connections with mobile networks, and other companies such as Nortel and Speedwise have also developed technologies designed to increase data speeds over wireless networks.

But Mr King is confident that Netverk can maintain its lead in this sector: "Over the next six months, this company will be taken to new heights when we announce new partnerships and new customers," he says.