Editor's View

Calculated risk

Platform: Mobile | Author: Alex Farber | Source: nma.co.uk | Published: 08.05.08

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Vodafone's decision to give away unlimited data to contract customers leaves it perilously close to becoming a mere bit pipe.

Previously Vodafone, along with the other operators, was selling bundles of data and earning recurring revenues in this way. But with consumers concerned about costs racked up while browsing over their phones it has been forced to reduce the cost to zero.

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... past operators have voiced fears about following the lead set by ISPs and losing out on valuable revenues by becoming simple connectivity agents.

Presumably Vodafone believes it can earn back the revenue lost by luring more consumers online thereby enabling it to sell more content and ads.

But this will only work so long as consumers remain on-portal. While they are likely to land on the Live! portal in the short term as the off-portal sector matures, this position faces significant challenges..

Vodafone's decision to bundle its data costs is the final step the operator can take to help grow the mobile internet and should be applauded.

But try as it might not to become a bit-pipe its decision to offer free internet seems to take it to the edge of a slippery slope.

In the highly competitive mobile market it will be interesting to see if the rival operators follow Vodafone's lead to head off any potential churn.

Feeling left out - 01.05.08

Virgin's decision to hunt for a mobile advertising sales partner is sensible but stark proof that the existing advertising industry continues to fail to integrate mobile.

IDS, Virgin's existing sales house, should be managing its mobile sales too. The same could be said of Orange, which has contracted Screentonic to sell its inventory despite having its own Orange Ad Network. Both operators are in a privileged position by having existing in-house sales divisions and each has indicated they plan to handle their own sales in time. it makes sense for them to start slowly with expert partners. But integration must happen quickly if the mobile ad industry is to realise its hype any time soon.

A strong cross-platform sales team, incentivised to sell mobile as part of its inventory could make a real difference to the market. Orange's latest set of results showing that 2.6m people visit its mobile portal each month should not be ignored. It's already half as many as the 5.9m monthly visitors to its online portal.

Several efficiently delivered and effective campaigns later and word spreads around a media buying agency's other clients.

Until mobile can be sold in a cross-platform manner it is doomed to be ghettoed and won't reach its full potential.

Agressive tactics - 01.05.08

Orange's decision to partner with Facebook and Myspace to promote mobile content resounds so much because it shows how rarely above-the-line marketing of mobile content takes place.

Activity is often funded by the operators which, while wanting to become more involved in content, should not be expected to shoulder the responsibility alone.

Ebay doesn't expect BT to market its services on its behalf. And if it did rely on ISPs it certainly wouldn't have half the amount of traffic it does.

Some industries have woken up faster than others to the potential benefits of advertising their mobile services above the line, which include added brand engagement and interaction.

It's an area that the motor industry has embraced, although all too often responding to a keyword on a poster still simply results in a request for more details to be sent via SMS for a brochure to be delivered by post. While functional it's hardly the most elegant or engaging of methods.

Sadly brands such as Smirnoff and Guinness continue to ignore the promotion of their impressive mobile sites in their arresting TV ads. The result is that consumers remain unaware of what's available.

News International is regularly held up as a shining example due to its 'Paper, Online, Mobile' tagline. More content producers and brands should follow its example. There's no point allocating a small test budget spend to mobile if you're not going to actively drive traffic to see if it works.

With mobile search still floundering dismally content providers must take responsibility for marketing their own mobile sites through their existing channels.

Operators have used web assets to market their services before, notably Vodafone's campaign with its partners including Ebay and Multimap and T-Mobile's early web & walk efforts with Google.

It's about time brands and content providers got aggressive if they want their traffic and ads to grow.

True dedication - 17.04.08

BBC and Diageo this week announced that they are dedicated to mobile. The backing from these early adopters should come as some relief to agencies and operators who have perhaps been guilty of placing too great an emphasis on the future of mobile marketing before it has really kicked off. But the signs are that the classic mobile hype could be justified.

Smirnoff said it was convinced by its initial mobile website trial with AKQA Mobile, and was planning on adding the platform into its ongoing central marketing planning mix later this year. Encouragingly sister brand Guinness has also recently launched a site, built by Marvellous, with the indications that this too could be here for the foreseeable.

Meanwhile the BBC has signalled that it's to finesse its mobile TV service but is very much dedicated to the platform following an extensive 12-month trial.

This follows decisions from Tesco and McDonald's to repeat initial mobile ad trials. The signs are that the brands are beginning to back mobile as they look to integrate it into a multi-platform environment

But there are rumbles that they are doing this in spite of a less- than perfect environment in which to work. At yesterday's Mobile Marketing Association conference media buyers complained about a lack of metrics when buying on mobile.

The onus now falls on the operators to work on this issue effectively to encourage more spend from existing customers as well as new business.

Operators own the data which is so crucial to the success of any site or campaign. One publisher told me that they would regularly receive contradictory usage stats from the operator and their platform provider. Another agency exec complained that each operator reports its figure in a different format.

Much rests with operator association the GSMA's attempt to bring some consistency to mobile metrics, headed by Henry Stevens. Having recently secured the trusted ABCE to audit their findings and discovered that all the operators are capable of delivering consistent results they must see through this initiative to get mobile marketing spend to seriously take-off.

Mobile evolution - 10.04.08

Mobile marketing agencies must continue to innovate if they are to succeed in rivalling established agencies.

The latest campaign produced by traditional agency Archibald Ingall Stretton on behalf of O2 is a perfect example of clever thinking from a company which doesn't specialise in mobile.

The innovative campaign uses MMS messages as a vital ingredient. Entrants are directed to start a 'guestlist', receive a unique code and then encourage as many of their friends as possible to send in their photo via picture message. The images are uploaded to a website and the entrant with the most friends wins a private party at The O2 to see Moby.

The campaign underlines it's not just mobile and digital agencies which are experimenting in the sector.

As mobile agencies attempt to extend their remit and offer a wider range of rich services to brands they must make sure that they are not simply delivering standard services such as mobile sites and SMS mechanics but pushing boundaries that are really going to inject some excitement from the brand and ultimately consumers.

If you want to be viewed as an ad agency then you had better come up with the creative goods.

Simply ticking boxes will not cut it as rival traditional agencies become more comfortable with the format.

To compete mobile agencies must continue to think just as inventively if they want to avoid being used as simple technology suppliers.

MIG is a great example of a mobile company which, through the launch of its digital agency Jigsaw, is starting to push out in new directions. It has already won business from Walkers.

Mobile agencies who are increasingly looking to carve a niche must continue to innovate if they're to gain similar status to the big digital and integrated creative shops.

The skills and technical ability are certainly in place but the danger is that mobile agencies become too focused on the mobile internet and fail to see how it can fit into the context of the wider world.

The O2 promotion is a perfect example of mobile as a rich channel it's a competition that would not be possible to offer as elegantly via any other means.

There is a real chance for mobile agencies to become the creative shops of the future but they must remember to start from innovative ideas and not just strong technology.

Time short - 10.04.08

Everyone likes getting something for free but only if you don't have to wait too long.

Mobile is billed as a medium that gives you something to do when you've got a few minutes spare. No-one wants to be hanging around downloading ads for ages when they could be watching content. Especially with networks that can still be annoyingly slow.

But people like free stuff and separate announcements from 3, Orange and O2, that they have negotiated with record labels to offer their customer ad-supported music, is the icing on the cake. News and horoscopes are fine but some Kanye West and The Kooks videos are great.

But if they are to be successful pre-rolls must be short and arresting. One of the best examples I've seen featured Ford's running dog on the Channel 4 mobile portal. It simply galloped on the spot for a brief few seconds before cutting into the clip. The branding was still effective and shows it's not simply a case of rendering an existing TV ad. But neither does huge expense need to be incurred.

Ads must also be kept relevant and pre-roll experts like Rhythm New Media and latterly Ad Infuse and 4th Screen Advertising have excelled in this space through careful demographic targeting. I don't mind watching an Adidas ad but Nivea is never going to cut it for me. Certainly not in this ad-skipping, PVR-led world.

Pre-roll ads still remain unproven online where even YouTube hasn't adopted the format, opting instead for a mixture of display and clever in-stream overlays.

It's still a young market and both online and mobile ads agencies are learning

But following experimentation it can be a valuable platform for both consumers, content publishers and brands.

Hidden costs - 27.-3.08

Data charges don't get discussed much any more but this doesn't stop them being important.

The industry has moved on to far more interesting topics like location-based services and touch screen technology.

But the fundamentals remain important and comments from Melissa Goodwin, head of mobile for ITV, that consumers no longer care about data charges are not valid in my opinion (NMA 27.03.08).Several scare stories in the press, and a recent (expensive) personal experience streaming too many music videos from YouTube prove that wherever there is unexpected cost there is danger.

People are still scared to press the internet button on their phones because they don't know what it might cost.

The efforts of broadcasters such as BBC, ITV, Channel 4 and YouTube moving properly into mobile to offer a wide range of their available content is great news for the industry. As I've said before, no-one really wants a half-arsed mobile experience. And with more content providers with an array of videos such as BBC, ITV and YouTube offering an ever increasing catalogue on mobile the danger is that the potential costs involved can spiral out of control.

Online video didn't really take off until broadband penetration grew and a reasonable amount of content could be delivered at a reasonable quality. Mobile video's short-form nature means its needs are slightly different but it has to protect its reputation early on and be as transparent as possible.

Getting charged an unknown amount to download a piece of content was something the industry always moaned about but accepted. It was widely credited with stifling the content industry. There was always the belief that after the operators set up flat-rate plans then the off-portal content market would explode and everyone would get rich.

One by one the operators bowed to pressure and did what was asked. Vodafone went so far as to spend £16m telling everyone about it in a slightly bizarre ad in which bits of metal fell from the sky.

3 and Orange have even gone one step further and axed data charges on their own portals in a bid to reduce the fear of the dreaded bill shock. The others should follow to reduce consumer anxiety further.

The move creates a virtuous circle. It has helped contribute to an increase in the number of mobile content publishers, which in turn encourages more people to sign-up to flat-rate plans.

Mobile gets handy - 20.03.08

If mobile services are to reach their full potential, they must offer something more practical than simple entertainment.

A great example emerged this week with the deployment of the NHS mobile service built by Incentivated, which allows users to find their closest doctor, dentist or A&E department. The highly accurate GPS targeting isn’t widely available in phones currently, but cell ID technology does a more than adequate location job.

This was quickly followed by Guinness’s Pub Finder mobile site, which allows consumers to locate their nearest pub serving the rare new Guinness Red. Obviously not a ground-breaking application, but it’s good to see brands experimenting with mobile interactivity.

Mobile entrants are becoming more concerned with driving traffic to their sites via a variety of channels. But once users arrive, they must have a reason both to stay and return to the site. Services don’t have to depend on innovative location-based or Web 2.0 technology, they just need to do the basics well. SMS is regularly used as a mechanic to drive offline traffic to a mobile site, but how regularly are the results analysed to determine where the most efficient space was purchased?

Que Pasa plans to combine mobile ticketing with sending regular SMS updates to clubbers at the Camden Crawl, letting them know which gigs still have tickets available.

The industry has largely been built on what has proved to be an unsustainable base of ringtones and wallpapers. It must look to the useful skills it has as well as the bells and whistles to cement its future.

Shifting ground - 17.03.08

The ground on which operator portals has comfortably sat is beginning to shift following the news from Conde Nast that it's to pull its content off-deck.

Traditionally the traffic-heavy portals have been the holy grail for publishers and vendors but as the space matures and third parties are keen to take more control over their fate, portal managers must manage their contacts more delicately.

Conde Nast's decision to cut its operator ties and head solely off-portal is a brave step.

Traffic is likely to slump in the short term but the publisher would rather take control of its own destiny than exist at the whim and mercy of operators.

Its fears can be seen starkly at O2 following news of Grahame Riddell, head of strategic content partnership's, departure. A content provider's all-important deck placement can be changed forever with the departure of a key contact and a publisher can find themselves buried deep in the portal.

With the best will in the world new people have new ideas and while some benefit from any changes, some will have to suffer.

With murmurs that O2 is to allow advertisers to direct consumers off-portal to their own sites rather than keep all click-through traffic on the portal gives greater opportunity for publishers.

Is it not more sensible for a content provider to launch off-portal, not bother about dealing with five slightly unreliable distribution partners and simply buy banner space directing consumers to its own home?

Maturing unevenly - 29.02.08

As LinkedIn, another of the world’s largest social networks, goes mobile (nma.co.uk 25.02.08), there are clear signs that the space is maturing. The danger is that the services themselves are not.

LinkedIn joins its peers Bebo, Facebook and MySpace by entering the mobile space, but all have done so with sites that offer far more limited functionality than is available online.

Partly hobbled by the technology, some basic functions, such as streaming rich media, viewing friends’ information or updating profiles, continue to be ignored.

Limited functionality could hold back services that are really flying elsewhere. There are technical concerns, of course, but if I can play music and video on some mobile sites it stands to reason that I should be able to so on mobile social networks.

This is an area where the mobile-centric social networks like Flirtomatic and Reporo have a real chance to shine. Given their experience, knowledge of mobile and flexibility, there’s an opportunity for them to capitalise on the less-than-perfect experience being offered by their fixed-line rivals.

The move of LinkedIn and its 16m users onto mobile must be applauded. Not only is the concerted effort of any media owner to move onto mobile helpful for the state of the industry, but it signals the entrance of a professional rather than social network.

With Travis Katz’s statement in that he expects half of all traffic to his site to come from mobile (NMA 07.02.08), it’s clearly an area that’s considered vital to execute well.

But if all mobile sites actually achieve is to look better when viewed on a mobile phone, then I’d be happy to navigate to the online version from my phone and swap a poorer viewing experience for better functionality.

Is Blyk for everyone? - 21.02.08

Everyone loves Blyk - except, perhaps, advertisers.

But even they love the concept of an MVNO that offers free calls and text messages to 16-24-year-olds if they agree to receive SMS and MMS marketing messages. It’s just the numbers that aren’t stacking up.

Advertisers need scale in order to deliver campaigns, no matter how targeted they might be. And according to agency sources, Blyk is simply not generating enough subscribers for them to consider running campaigns.

Media planners have expressed disappointment with the level of subscribers to the service - currently standing at around 30,000, although Blyk insists its on target to hit 100,000 by September.

It’s also worth questioning how many of the 30,000 are active users and how many just signed up to get the free calls and SMS, used up their credit and then chucked the SIM in a drawer.

Even if the model itself stands up, the looming danger is that Blyk’s every move is being scrutinised by some very curious parties: the operators.

If Blyk is a success, there’s little to stop an established operator with a huge customer base from simply stealing the idea wholesale and offering it to its own customers.

However, some observers have expressed doubts about the model itself. In this age of behavioural targeting, there’s a danger that in an emerging, mobile market the targeting can go too far.

Eyebrows have also been raised over the number of employees - around 30. Most mobile start-ups run lean outfits to account for tight margins. And even well-established companies in the sector try to keep staff numbers down.

There’s nothing wrong with a new entrant into a market shaking up the old guard, and virtually everyone I speak to welcomes the entrance of Blyk. But there are fears regarding the sustainability of its model.

Hope for Yahoo! - 14.02.08

For all the speculation surrounding Yahoo!'s future, this year's World Mobile Congress - previously known as 3GSM - offers a ray of hope for its mobile strategy. Indeed, it's fair to say it's been nothing short of bullish in this channel.

Yahoo!'s coup of securing the search partnership for T-Mobile from Google has helped bolster its position in mobile further.

It now has search or ad deals in place with all five of the UK operators and looks to be in good shape, putting it in a strong position in mobile at least.

Vodafone must be considering its decision to work with Google as its search partner, particularly as it's already contracted Yahoo! to sell its mobile ad inventory.

It's unclear if Yahoo!'s aggressive mobile strategy has put any value on the company as it bids to repel Microsoft's unwelcome advances. No-one from either company was prepared to comment on the deal but working closely with increasing numbers of major telcos can't do it any harm.

Also in Barcelona, Yahoo! unveiled OneConnect, its new intelligent address book which collates all your SMS, IM and email conversations with friends along with location awareness and social networking status.

Applications are not always straightfoward on mobile but if it can work with one of its operator pals to embed the address book into the phone it could quickly gain a stronghold in consumers' pockets.

Mobile internet is here! - 08.02.08

Ahead of the world's biggest and most hectic mobile conference MWC in Barcelona there are indications that mobile internet services are finally taking off.

Of course the stands from the infrastructure and base station technology companies (dull but worthy?) will still dwarf those of the content guys but ground is being made up. And who wants to work in that end of the business anyway?

When Travis Katz, international MD for MySpace predicts that half of all traffic to his site will be from mobile within five years, (as our front page story revealed this week), people listen. This vision is from a man who is top friends with Tom from MySpace and someone who really understands the youth market that's shaping tomorrow's media landscape.

In any case his, 'this time next year, Rodney...' statement is backed by statistical evidence from the operators. The Mobile Data Association released its first set of figures in a long time showing the mobile internet to be continuing its stellar growth, with 17.5m people logging on in December alone.

This past year has seen renewed pushes into mobile from Facebook, Google, ITV, News International, Yahoo! and YouTube - it's clear things are starting to get serious.

And more satisfyingly these guys are not just trying to flog ringtones but build sustainable businesses dependent on loyal traffic and ad money as well as premium content.

The mobile internet experience is still far from perfect with poor connectivity, rudimentary navigation and less than perfect search.

But the signs that the media companies are beginning to formalise their strategies is a healthy first step.

Charging ahead - 01.02.08

Mobile data charges are back on the agenda following news this week that both O2 and Vodafone are scaling back their access fees.

Connectivity costs might not be the sexiest topic but it plays a vital lifeline for content providers.

Two of the most dependent, the BBC and YouTube, have also reached tipping points this week. Their rich video content demands reasonable data rates if the services are to take off.

The BBC is evaluating its mobile TV strategy as it draws to the end of its 12 month trial. And YouTube has made its entire catalogue of videos available rather than the edited version initially trialled.

Cheaper data rates allow more consumers to access services without fear of bill shock.

If operators want content providers to use the mobile internet then they must reduce the data charges which can cripple consumer interest.

The signs are that this is starting to take shape. All that remains is for operators to market their cheaper tariffs.

Only then - when the public really understand the cost implications - will services, like the Beeb's and YouTube's, take off.

Welcome back Bluetooth - 24.01.08

The news that outdoor planning agency Kinetic is to launch a mobile subsidiary has pushed Bluetooth technology back into the limelight.

The WPP-owned advertising giant wants to boost the level of interactivity it has with consumers from the moment they leave their homes - and views mobile as a natural extension.

Bluetooth first received a shot in the arm due to legislation requiring drivers to use the technology in their cars, according to one agency. Now more manufacturers are steadily incorporating the technology into their cars for the first time.

But in order for the medium to be accepted by consumers as a valuable piece of marketing rather than unsolicited spamming, the content delivered must be up to scratch.

Bluetooth can be location-based but offers little opportunity for personalisation at this stage, complicating the pay-off.

Fortunately there has been a supporting shift from creative agencies to produce rich mobile content this year.

This growing content base can be delivered to consumers in a variety of ways, including using Bluetooth. If outdoor agencies prioritise mobile on their budgets, content of a sufficiently high standard must follow.

To date Bluetooth has failed to gain momentum in outdoor advertising media. But the fact that mobile is now on Kinetic's agenda could yet change its fortunes.

Focus falls on content - 17.01.08

Two significant mobile advertising deals announced this week underline the maturing of the market and the need for content publishers to raise their game if serious sales are to be expected.

Nokia Ad Sales closed a deal with off-portal publisher Reuters (NMA 06.12.07) while Yahoo! secured T-Mobile's Web & Walk inventory.

As the remaining mobile content properties continue to be signed up by aggressive ad networks and the market saturates, the onus must be on publishers to attract new visitors for their ad network to sell around.

High-end phones, flat-rate data packages and a marketing spend from operators have all fallen into place. It's now left to the publishers to do what they should do best - offer compelling, sticky services.

Growing investment and innovation from the advertising industry - witness the recent impressive mobile work BBH has carried out for Lynx - will follow traffic if its generated.

The mobile ad networks such as 4th Screen Advertising, Admob, Admoda, Nokia, Screentonic, Yahoo! are engaged in a competitive land grab to win any available premium inventory and offer it to blue-chip advertisers. But their potential risks being stunted unless traffic continues to grow.

But there is still scepticism surrounding the current level of interest from major brands in terms of major investment in mobile advertising. Advertisers demand reach if mobile is to make it onto the top line of a marketing budget.

Dropping DRM - 14.01.08

The turn of the year saw the two remaining major record labels, Sony BMG and Warner Music, finally embrace DRM-free formats in a move that could ultimately prove to be the true test for mobile music.

Then Napster announced it was making its entire catalogue available in MP3 format within the next six months.

The mobile music industry must move to make the most of this opportunity.

While it is a chance for iTunes' fixed-line rivals to gain market share it is also an opportunity for mobile vendors.

The operators running digital music stores can't afford to drag their feet over a switch to MP3 if they're to gain any traction. Before the end of 2008 no-one is going to be interested in buying a copy-protected music file when MP3s are legally available.

And while the operators might be as slow to react as the music industry was, a mobile-savvy third party vendor such as a Jamster or Napster Mobile could be far fleeter of foot.

Ironically they will take full advantage of the flat-rate data plans operators are starting to offer removing the issue of data costs.

The birth of the DRM-free revolution represents a real chance for mobile music vendors to stake a claim as the massive hurdle of inter-operability is removed.

And the proposition for mobile music remains as strong as ever. Being able to legitimately buy a track wherever you are - and then crucially transfer it to PC - still makes good sense.