S. Africa - Land of Opportunity

Hemant Kumar, Assistant Manager, Online Marketing and Advertising Sales, at mobile ad network Mkhoj, looks at the mobile advertising opportunities for brands in S. Africa

S. Africa is considered the fourth fastest-growing mobile communications market in the world. It has witnessed a huge success in the adoption of mobile communications, and also in the acceptance and growth of mobile advertising. The secret behind this tremendous success lies in the inherent behaviour or the market, including social and economic factors.
If we examine the success of S. Africa closely, some interesting facts emerge. Firstly, mobile penetration in S. Africa outnumbers PC penetration by a ratio of 2:1. Credit has to also go to S. Africa’s highly progressive user base, which has adopted the mobile Internet in a huge way. Mobile data usage is encouraged by the competitive operator market, which provides low-cost Internet access. In fact, S. Africa recently witnessed a whopping 90% cut in data charges, with the average now standing at approximately 2 Rand/MB (£0.16). In all, the favourable ecosystem, working in tandem with the competitive market, provides the right environment for the growth of mobile advertising.

Market insights
This market has shown some unique trends that create a good mobile advertising opportunity for publishers and advertisers. The number of publishers in S. Africa is significantly lower than the number of advertisers. The reason for this boils down to a simple supply and demand phenomenon. The user base in S. Africa is more inclined towards international sites rather than local sites. Over time, seeing the successful adoption by users, the number of local advertisers began to grow at a fast pace. The increase in the number of international publishers was much slower. This resulted in a large number of advertisers compared to the number of publishers, creating a high demand for publishers in the market. The outcome of this is high cost-per-click (CPC), giving publishers opportunities to generate high ad revenues.
At mKhoj, we strongly believe that in S. Africa, publishers stand to gain from the advantages of early adoption, such as lower competition. We have seen our partners have a great experience wiuth their mobile advertising campaigns, due to the high monetization capabilities of the S. African market.
From an advertiser standpoint, though the industry standards demand a high CPC, the customer usage helps to maintain the profitability levels and justify the investment. The user base is very content download-friendly. In fact, in the month of May, 85% of our network traffic from S. Africa was driven by content downloads.

Useful services
We believe that the services that are valuable to S. African mobile users will be the ones that are useful, simple, uncomplicated and easy to use. They will make users’ lives easier, or give them access to services that were previously unavailable or too expensive.
Over the past couple of months, the mKhoj network has seen a tremendous growth in mobile Internet traffic in S. Africa. Mobile advertising in S. Africa is being demystified. The time for advertisers, agencies and publishers to capitalize is here.

Threatening Behaviour

Jay Seaton, Chief Marketing Officer at Airwide Solutions, look at the increasing threat to mobile users as they use their phones to go online and download applications, and at possible solutions

In less than 12 months, the Apple App Store has revolutionised the global mobile industry. It has helped usher in a new wave of applications and services which, combined with the greater availability of open mobile networks, lower mobile data costs and the wider variety of Smartphones, has helped create a new type mobile communications experience…one dominated by a new generation of content, entertainment and social networking.
However, the industry is realising that while the opportunity is vast, the new channels of communication can be exploited very easily. This is not only of concern to the mobile operators, application developers and end users, but also to the brands wishing to use these channels to influence the consumer. Unless appropriate controls are put in place to protect people from harassment, unsolicited messaging, inappropriate content and fraud, these concerns have the potential to inhibit the growth of mobile marketing and the usage of messaging and data. Without the ability to preserve privacy by managing content and access, a user has one choice - suffer or switch off the service.

So what are the biggest threats?
As the mobile ecosystem evolves, the threats (namely fraud, theft, virsues and spam) have become more numerous and more aggressive. Almost every day there are reports of new security loop holes being breached but what is making them extra concerning is the ease of which they are being exploited.
Earlier this month, Reuters reported a scam allowing criminals and hackers to send spoof text messages to mobile phones under the guise of a user’s mobile operator. If accepted, the message was able to change the phone’s settings, making it vulnerable to further intrusion. Hackers were able to access sensitive information (such as account details or PIN codes used for mobile banking, confidential company information or personal details), steal data, install or remove programmes, inject malicious worms and even access internal mobile operator network resources.
Similar SMS spoof threats were also reported earlier this year – such as a threat to the social media tool Twitter. Here, according to tests run by Heise Security, hackers were able to post fake status updates on users’ private Twitter-feeds, via an SMS faking service.
Although these risks seem relatively small at the moment, with mobile becoming a recognised space of rapid growth – particularly with the rise of Smartphones and uptake of external content via applications and enhanced services – the problem is becoming more acute. Unless protective procedures are put in place, security flaws like this latest one will leave billions of mobile phones at risk of fraud.

Encryption mechanisms
So how can we protect ourselves against these heightening mobile threats? While there should always be a degree of responsibility for handset manufacturers to provide encryption mechanisms in order to protect their users, we should also recognise that handset based solutions can be limited as they only protect a relatively small number of mobile users from a certain subset of threats. Also, with mobile devices constantly being upgraded and replaced with higher specification devices, security software is often quickly outdated.
There is also of course the risk the subscribers pose themselves. Although most people interact with their mobiles in a responsible way, there is a possibility for users to unwittingly accept a fraudulent installation of new settings if they believe it is coming from a trusted network provider.
One of the most effective answers instead lies with the mobile operators, as mobile security solutions which are deployed on a network level are both controllable and easily upgraded. Currently, many network operators voluntarily police potential fraudsters, but as messaging services continue to grow and become more complex, networks need a comprehensive range of features, such as anti-spam and virus filtering software, EIR systems and blacklisting, anti-spoofing and anti-flooding technology.

Mobile security technologies
Using a variety of mobile security technologies, including anti-spam, anti-spoof and anti-flooding, along with next generation gateways, operators can detect abnormal patterns in messaging traffic, confirm legitimate senders, filter content and block suspicious messages. 

In the case of these latest scams, deploying a combination of spam filtering and anti-fraud techniques would help operators not only block the fraudulent messages, but also disable bypass mechanisms, ensuring they always have full control over the access channel to the subscriber. Filtering content also helps the fight against the spread of viruses and trojans. Blacklisting permits users to block certain phone numbers and incoming messages coming from these phones, whilst EIR systems have proved to be a very useful tool in handset fraud prevention.
With appropriate security measures in place, mobile operators can protect their subscribers and their networks from potentially damaging security risks. As the rise of applications and services continues, they can also protect their revenues, without fear of jeopardising them through malicious attacks. Once customers feel assured they will not receive a barrage of potentially dangerous unwanted messages if they download an application, they will feel more confident about downloading content and services in the future

Multimodal Mobile

Philippe Jeanrenaud, Director, Speech Mobility Marketing, EMEA at Nuance, looks at the trend towards offering multiple forms of text input and commands on mobiles

It seems as though the mobile device market has been evolving and growing at break-neck speed over the last few years, particularly with the advent of the iPhone. We’re relying on our phones more than ever to not only make calls, but to send text messages and emails, download music, get directions to a coffee shop we just found by searching the web on the phone – it’s amazing, and it’s only going to continue to get better with the downloadable application market rapidly heating up.
But just as we have an amazing pool of applications and services at our disposal to get our devices to do just about anything, so getting access to those apps faster and more easily becomes a key challenge for handset manufacturers and carriers. In addition to the clear need to ensure the user experience is the best one for their consumers, there is also  huge revenue potential at stake. Easier access to, and increased usage of, applications and services ultimately increases the average revenue per user (ARPU). And it’s all about ARPU, right?
Predictive text and speech recognition software are already playing a role in creating that path to the ultimate user experience, and many of the phones coming to market today have both predictive text for faster and easier texting, and basic speech capabilities like Voice Activated Dialling (VAD). But this calibre of implementation is just scratching the surface of how powerful a multimodal input approach can be for creating an amazing user experience that drives revenue and brand loyalty. And of course, there are a number of external factors, like distracted driver legislation, that clearly demonstrate the value of input options being fully integrated.

The keypad evolution 
The evolution of the phone keypad is a good example of how we’re beginning to see increased multimodality on mobile phones – whereas most traditional consumer phones used to only include a 12-key phone pad, the full QWERTY keyboard made its way first onto the BlackBerry, and now onto more and more feature phones. Largely driven by texting and the evolution of lower-level devices being able to handle email, consumers demand faster and easier text input capabilities. With that in mind, we’ve seen many devices over the last few years that feature a 12-key phone pad on the main interface for easy dialling, and a slide-out QWERTY keypad for easy texting and emailing. Consumers to get the best of both worlds – easy calls and easy texts.
But with advent of the iPhone came the touchscreen user interface (and of course, the app store phenomenon) – and a new era in mobile phones was born, with touchscreen devices mow available from several handset makers.
In just the last two-three years, we’ve seen an evolution of modality on the keypad. And there is a clear market for both – with mobile users addicted to the look and feel of the touchscreen, and those who wouldn’t dream of giving up their hard QWERTY keypad. 

Moving beyond VAD
As mentioned earlier, many of today’s phones have basic voice recognition capabilities for dialling numbers and finding contacts, and checking the status of your phone’s battery, eliminating the need to scroll through address books and menus. Voice input is perhaps the fastest and easiest input method, which is why there is an increasing adoption of expanded voice command and control capabilities. In fact, Datamonitor recently released a report stating that the market for advanced speech recognition technologies in mobile devices will triple over the next five years, rising from $32.7 million (£19.7 million) in 2009 to $99.6 million in 2014. We’re seeing this traction unfold, with many of today’s higher-end feature phones now enabling users to access just about any application or service on the device with their voice. Looking to play BubbleSmile? Just say “Go to BubbleSmile” and you’re there. Need to send a text message to John Smith? Just say “Send text to John Smith,” and the input field appears. 
This is where the multimodality of speech and text input are increasingly intersecting, and where the myth of the multimodal handsets is starting to become a reality. For instance, Samsung devices like the Instinct and the Memoir allow users to pull up the text input screen with their voice, and automatically bring them into a touchscreen QWERTY text input field that features predictive text. And of course, there are devices coming to market with full dictation capabilities, where you launch the text application with voice, dictate the message and then send it with a simple voice command – no text input at all. This completely voice-enabled phone is not far from hitting the market, and the technology is here today, where consumers can surf the web, download music and get directions – all via voice commands.

Complementary solution
So why the need for a complementary input solution when voice-driven access is the fastest and the easiest? Simply put, there are many situations where speech input isn’t appropriate. If you’re in a meeting, and you need to send a message to your boss that you’re about to close a major deal, traditional texting is clearly more appropriate. Or if you’re at a concert and want to download the new song your favourite band just played, you’ll likely have a hard time with the voice query in an incredibly noisy environment.
Similarly, there are many situations where text or manual input just doesn’t work either –especially while driving. Many governments across the globe are passing legislation that mandates hands-free control of phones as a means of thwarting the user’s ability to text while driving. And for good reason: a 2008 study conducted by the Technical University of Braunschweig in Germany found that utilizing speech to even dial a number on their phone improved the user’s ability to maintain the ideal car position by 19% when compared to manual dialling. Better still; speech input was also approximately 40% faster in making a call, reducing the distraction period by the same amount. With the fully speech-enabled handset, drivers have the ability to interact with their device as needed. 

Multimodal output
Today’s mobile consumers are quickly realizing that multimodality is more than just input – it’s also about output, and the ability to manage services. Voicemail to text services are perhaps one of the best examples of this, where voice messages are intercepted by an automated service or team of transcriptionists to transcribe a message that is then delivered straight to the user’s inbox, or sent as a text message. Gone are the days of having to listen to a voicemail, then write down a number or message, or worse, missing a voicemail if you can’t access your phone – it’s all completed in a matter of minutes for you and dropped into your inbox.
With regards to output, text-to-speech technology is increasingly being integrated into today’s devices to confirm that an interaction with the phone succeeded or failed, read back text messages, confirm phone numbers and contact information, read aloud directions, and more. Text-to-speech integrated with speech input is the key to the truly hands-free device, where consumers are able to have a conversation with their phone to do virtually anything, such as download a song or get directions. This is one of the most exciting advancements in multimodality, that we’re going to see more of in the coming months.
It’s also worth noting that similar output exists for the hands-on experience as well, with hard and touchscreen keyboards providing haptic feedback, such as a vibration or sound, to confirm that the interaction has taken place. 
Speech and text are increasingly becoming intertwined and integrated on the phone as part of the best possible user experience, that gives consumers the ability to access what they need when they need it, which in turn is driving increased brand loyalty and revenue opportunities for OEMs and operators.  
A key aspect of multimodality that cannot be lost, however, is keeping that ‘power to choose’ input in the user’s hands. Each user’s experience is their own, so it’s important to not completely dictate their interaction with the device and what input method they need – some will likely rely heavily on speech as more phones come to market with advanced capabilities. And of course, there are those who often find themselves in situations where text input is a must have. It’s all about what the user is trying to achieve, and ensuring they have the utmost innovative input technology to get there.   

Future-forward multimodality
Multimodal input and output is an exciting area to watch, as additional areas of speech technology become closely integrated with mobile applications and services. For instance, imagine combining interactive voice response (IVR) technology with enhanced output on the device. One example is calling 1-800-FLOWERS, where the IVR options are enhanced on the screen of the device, providing pictures of the flower options with pricing information, or the ability to design your own flower arrangement right from your phone. To help ensure consumers continue using the service, 1-800-FLOWERS would remember what you ordered in the past, your preferences, etc., and enable the user to place similar orders easier and faster, using voice or text input, right from the phone.  
This scenario is a culmination of on and off-device applications, intertwined with a variety of input and output options that not only drive value for OEMs and operators, but also for the companies that sign on for them.
There’s no doubt that multimodality will continuously evolve, as it provides a richer user experience, enabling consumers to leverage the input and output methods that are best suited for them moment to moment.

Wi-fi? Why Not?

Niall Murphy, co-founder of The Cloud, argues that Digital Britain will fail without the mobile Internet

The Digital Britain report sets the objectives of modernising digital networks, ensuring access for all, and stimulating the development of a vibrant digital economy and social environment in Britain. The proposals put forward in the report, however, are flawed, through the limited extent to which the creation of an Internet-everywhere, ultra fast broadband mobile Internet environment will be enabled – a critical success factor for a 21st century digital infrastructure in Britain.
The report fails to address the role of wi-fi and related technologies, and to provide a framework for the availability of increased unlicensed spectrum and licensed spectrum with the capacity to provide ultra fast mobile Internet services. Wi-fi today provides simple, fast, wireless broadband and open Internet experience to millions of wi-fi-enabled devices across the UK. Millions of wi-fi networks utilising unlicensed spectrum are creating a high speed mobile Internet access network across Britain. Given Internet access by citizens in Britain during the course of the next five to 10 years will be fulfilled through handheld and mobile devices, it is crucial the Digital Britain report provides a strategy that will enable the broadest possible availability of ultra fast mobile Internet access at the lowest cost, and supporting a dynamic digital economy and environment.

Blending technologies
The Digital Britain report fails to discuss the benefits of blending technologies like wi-fi and 3G or 4G together. Whilst there are clear benefits to spectrum re-farming and the availability of additional spectrum at 2.6GHz and through the digital dividend process, the report fails to address the scale of broadband demand that will be fulfilled through wireless. With mobile Internet users today increasing their mobile data capacity demand at between 3- and 5-fold per annum, 3G and emergent 4G technologies provide insufficient capacity to service this demand – which will be almost 100 times greater per mobile Internet user in Britain by 2015 than it is today.
The report sets the objective of ensuring a viable commercial model for mobile network operators. This goal will be impossible to achieve with operators required to undertake very large capital investments in one technology in an attempt to keep up with mobile Internet speed demands.
A solution is to utilise wi-fi and similar short range, high speed wireless broadband technologies in combination with the ubiquity capabilities offered by 3G and 4G technologies. An ultrafast mobile Internet environment can be created by blending 3G, 4G and wi-fi technologies, and by undertaking initiatives to stimulate and support the creation of high speed wireless broadband wi-fi networks across Britain.

Proof point
The current success of the Apple iPhone provides a proof point for this model, with the device defaulting to wi-fi for Internet access and, if wi-fi is not available, seeking out 3G coverage. The result is a high speed experience and a cost efficient network.
Market forecasts indicate approaching 70% of all Internet traffic will incorporate video or video clips by 2012 – as of today wi-fi is the only available technology to effectively deliver high quality streamed video over the Internet to mobile devices. British citizens will expect to benefit from, and be able to apply a multimedia mobile Internet, and it is therefore crucial that the right strategies are applied to see its creation in Britain. Britain will fail in its ambitions if these issues are left unaddressed.

Get Ready for the SMS Advertising Revolution

Alan Pascoe, Senior Product Manager at Tekelec, explains why SMS is set to fulfil its potential as a mobile advertising medium

Last December, marketing and media information firm The Nielsen Company succinctly stated why SMS-based advertising campaigns will flourish, saying: “Where there's an audience, marketers are not far behind.”
Industry analyst Informa has estimated that the mobile advertising market will be worth $11 billion (£6.8 billion) globally by 2011. The key to that forecasted growth is the fact that mobile advertising offers brands an unprecedented ability to build highly targeted, personal relationships with consumers. Mobile is unique because of the sheer number of devices, outstripping the number of televisions or personal computers. Match this with the mobile operators’ control over their networks, and you have a very exciting proposition for brand advertisers and marketers. 

Consumer reach
In-message SMS advertising provides the widest possible consumer reach of any mobile channel. This method enables operators to insert advertising content - such as commercial text for sponsored SMS or voicemail enrichment - into the unused portion of text messages.
Its growth in the UK and other mature markets has, until now, been slowed due to several factors. For one, many mobile marketing channels, such as mobile browser banner ads, have limited the uptake of sponsored text messages. In addition, the 2007 GSMA Mobile Advertising Programme (MAP) focused on non-SMS channels, driving initial attention to other communication methods.
SMS is practically a ubiquitous service globally, with more than 3.5 trillion messages sent in 2008 according to Portio Research. Or as Juniper Research said in its report, ‘Mobile Messaging & IP Evolution: Players, Strategies & Forecasts 2009-2014’: “The ubiquity of SMS in terms of being supported by almost every mobile phone model creates a large addressable market for SMS-based advertising campaigns.”
Also, in-message advertising is particularly suited to ad-funded SMS business models, where subscribers opt in to receive commercial content in exchange for reduced rates.

Operators redefine targeting
The characteristics that make SMS a great tool for personal communication -  pervasiveness, immediacy and relevance - make it an ideal tool for advertisers and a great source of revenue for operators. 
Operators own three unique assets that make text advertising an ideal money maker:

• Real-time demographic and behavioral data - Subscriber information, coupled with presence and location awareness, enables operators to offer distinct, personalised and relevant communication. The result is higher open rates; a Direct Marketing Association survey in August 2008 revealed that almost 70% of respondents reacted to SMS messages sent from suppliers, compared to only a 30% success rate for email.
• The “white space” remaining when text messages contains fewer than 160 characters, providing the real estate to send targeted communications - The average text message comprises about 80 of the 160-character allotment.
• A direct link to recipients of advertising campaigns, providing granular measurability for advertisers and subscribers.

Advertisers and operators, of course, have to tread carefully on consumers’ privacy and be diligent to not send unsolicited advertising. A win-win situation requires that mobile advertising offers consumers something in return, in the form of rebates, coupons, prizes, or extremely relevant and targeted advertising that is perceived as valuable and original information.

SMS ad potential
Operators can create time- and location-based advertising programs and, by using subscriber profiles, target content to match individual preferences. Examples of text feeds that subscribers would value in incoming SMS messages include:

• Commercial text, such as an advertisement based on the recipient’s city – or even block – or based on a keyword in the message.
• Text ads for operators’ new service offerings
• News and sports flashes linking subscribers with their favourite topics and teams, and giving local, national and international media organisations an opportunity to identify new consumers.
• Voicemail enrichment when operators send SMS voicemail notifications. This type of application-to-person message makes voicemail more engaging to customers. Operators can include a variety of text with the notification, such as holiday greetings, trivia questions and the above-mentioned examples. In addition to revenue opportunities through sponsored ads, this service also strengthens subscriber loyalty by providing voicemail differentiation from other operators.

Operator benefits
The benefits to operators go well beyond the success of any singular campaign. Most importantly, in-message SMS advertising increases operator revenue from SMS.  Service providers are seeking to extend SMS value, as message volume is outpacing revenue. According to Frost & Sullivan, the number of text messages is forecasted to expand at a compound annual growth rate (CAGR) of 15.6% from 2007 to 2011, while SMS revenues are only expected to grow at a CAGR of 5.9% over that same period.
In-message SMS advertising also reduces subscriber churn by offering incentives to take part in mobile advertising programs. In addition, the service generates accurate sponsor charging and ROI calculations by recording successful delivery, and enabling customized responses, such as calling or texting a number, or visiting a website through a mobile browser. Also, operators can offer advertisers the ability to send timely and relevant content, based on recipient profiles, the latest news or new products and services.
With sizeable subscriber bases and the unique ability to track those subscribers’ behaviour and personal preferences, operators can tap into the growing and potentially lucrative mobile advertising market with in-message SMS advertising.  It has the potential to be the largest advertising opportunity in the mobile world, and one that operators can tap today using their existing SMS networks to generate new revenue and deliver attractively priced services and programs that create subscriber loyalty.

The Real Cost of Spectrum Auctions

John Strand, CEO of Strand Consult, argues that the process by which mobile telecoms frequencies are auctioned off is bad for society

Back in the year 2000, many politicians saw great possibilities in auctioning off 3G licenses and a number of the world's largest mobile operators spent fortunes on licenses in the hope that this new technology would make customers ARPU explode. Experience now shows that 3G has not helped increase revenue - in fact ARPU has decreased in many countries.
During the coming years, society needs to decide how to handle the spectrum it administrates. We are talking about the renewal of 900 MHz licenses in a number of countries, we are talking about the digital dividend - that is the spectrum that lies between 790-862 MHz in Europe and between 690-806 MHz in Asia and we are talking about the spectrum around 2600 MHz that many operators will use for LTE.
There should be no doubt that spectrum is a resource that belongs to society and, in the same way as society's many other resources (oil, gas, water, gold, silver, diamonds etc) that it should contribute to society's economy. The question is simply: how can society can best utilise these resources? Will it be through selling licences, or by the licenses being used to create an infrastructure that helps society develop, or will it be by combining these two models using a ‘stick and carrot’ model?

Enormous revenues
If you examine the consequences of the 3G auctions, they did give many countries enormous revenues in the short term. On the other hand, it should also be noted that, notwithstanding the recess in the mobile industry between 2000 and 2003, the high licence fees also resulted in 3G having a slower roll-out in a number of the countries that had paid most for their 3G licenses.
At Strand Consult, we believe that the actual value of selling a mobile licence in the future is minimal, compared to the value of a society having a national mobile broadband network, which will enable an increasing number of citizens to connect online, at high speeds and regardless of the customer’s physical location - at home or on the road, in the city or in the country.
We believe that the path forward is an open auction model, where the licenses are sold to operators under certain terms and conditions. We believe that operators should be encouraged to work together on building network infrastructure, especially in thinly populated areas, and we believe that operators who deliver better coverage than required by the licence terms should be rewarded for doing so. This can be achieved by using taxation models, or by giving a share of the auction money back to the operators, if they do things that benefit society.

Work together
When Brazil looked at auctioning off 3G spectrum, it took the decision to force operators to work together on building network infrastructure in the more remote areas, and at the same time, to give  part of the auction money back to those operators that achieved a better coverage than was required by the terms of the licence. Basically, the long-term interests for society, were considered to be more important than short-term financial interests.
In all its simplicity, the political system ought to enter into a close dialogue with operators and view the mobile industry as one that can help develop modern society. Countries that can offer their citizens and companies access to the best telecommunication infrastructure will be the ones best prepared for the future. The telecom industry is - and will continue to be - the industry that connects modern society together, and its products are the foundation which enables countries to become more efficient by using new IT systems and modern telecommunications.
In our latest report, we examine the mobile broadband market, what it looks like and how it is developing. We believe that the possibilities available with mobile broadband today - and in the future - are so immensely important to society, that a simple auction can be very bad business for modern society.

Convergence Please!

Daryn Wober, Vice-President, Business Development for IMImobile Europe, argues that brands that get to grips with mobile, and develop intergrated online/mobile campaigns, will reap the rewards

In today’s connected society, consumers want content and services at the touch of a button; whether it is online or via a mobile device, all that matters to them is that they can access their content of choice. Most of the relevant industries have responded with enthusiasm - the multimedia, broadband-enabled devices and the infrastructure have both been created, while the content has been adapted as required, and access is affordable to a mass market. This ought to be a perfect environment for brands to follow the consumer on to their platform of choice. Yet although the advertising community has latched on to the online opportunity with enthusiasm, the mobile platform remains largely unexploited. Why is it that companies are not fully embracing the mobile environment to create fully converged marketing campaigns?

Primary communications device
With around 4 billion mobile users around the world, the mobile handset has become the primary communications device for many. Its personal nature, coupled with its multimedia capabilities and increasingly high speed connectivity, suggest that the consumer love affair with the device is only just beginning, and it’s obviously not just about voice calls. According to Frost & Sullivan even the humble text message will see a CAGR (Compound Annual Growth Rate) of almost 16% between 2007 and 2011. And thanks to much more capable devices like the iPhone, and ‘all you can eat’ data packages, we are now finally starting to exploit the full data capabilities of the platform. This ought to be an advertising nirvana, but the reality is that the industry is littered with the remains of those who got it wrong.
We don’t have to look far to discover why, and it comes down to two primary factors. The first is the apparent (and sometimes actual) complexity of the mobile platform. Brands and their agencies do need to gain an understanding of the opportunities available, which range from simple SMS advertising alerts, ringtones and wallpapers, to in-video insertions and sophisticated location-based targeting within games or social networking applications. They also need to know how to get a marketing message, in the right format, across a variety of operator networks, to each one of the thousands of different handset models that may be in use. Finally, they also need to be able to deal with the interactions from the target consumers.

Mistrust of the medium
The second factor, as noted in a September 2008 report from media measurement group, Nielsen, is a mistrust of the medium. Advertisers need to know that consumers are receptive to mobile advertising before they will invest. As Nielsen points out, those with advertising dollars to spend don’t “…trust consumer receptivity, they don’t trust ROI and they don’t trust their ability to track performance.” That shouldn’t come as any surprise - many of the campaigns we now see on mobile simply don’t have the tracking and measurement mechanisms in place to make the necessary judgments.
Given these two factors, the reluctance of many is understandable. As online and mobile audiences grow, however, converged campaigns are going to become more necessary. A multichannel mobile campaign that is fully integrated with the online elements is the future. The good news is that solutions are already available that streamline the process and have built in tracking and measurement to demonstrate the return on investment.
Those that get it right reap the rewards. Facebook, for instance, is an enterprise that has created a seamless converged experience. A mobile interface, available to a wide variety of users, that takes account of both the limitations and advantages of the platform to enhance and extend the online experience. Facebook already has over 5 million monthly users via the mobile platform, evidence that, when properly implemented, the online experience can be adapted to mobile and enhanced.
Perfume company Coty Prestige, working with media agency OMD, is another good example. Coty launched Gwen Steffani’s Harajuku Lovers Fragrance Collection earlier this year, offering users entertainment content via both online and mobile platforms. Using a managed service provider, OMD was able to launch the ‘World of Harajuku Lovers’ website and mobile WAP platform, offering fans the opportunity to enter competitions to further engage with the brand. Fans could enter themselves into a karaoke competition by recording their entry at branded Harajuku Lovers booths dotted around the UK. Users could then vote for their favourite karaoke clip, with further opportunities to win prizes online and via the WAP platform.

Consolidated approach
Delivering a fully converged online and mobile campaign needs a consolidated approach to campaign design, deployment and management. It is something that requires the infrastructure, knowledge and expertise of a managed service provider, rather than the point solutions for individual campaign elements that we often see today. With those facilities available, much of the process can be automated, and agencies are able to focus on the creative elements. The managed service provider deals with content ingestion, reformatting and delivery across the chosen networks and has the reporting tools that produce the market intelligence.
Juniper research estimates that the mobile advertising market will grow to $7.6 billion (£4.7 billion) by 2013, a CAGR of 42% since 2008. For that estimate to become reality, and potentially to be exceeded, it is vital that creative agencies work more closely, at an early stage, with managed service providers capable of delivering end-to-end solutions. If that happens, brands will quickly understand the wide range of possibilities and the potential returns, the complexities will be irrelevant and the ROI will be demonstrated.

SMS - It's a Two-way Thing

The simple SMS message could be the next business tool to revolutionise customer and employee interaction - and not a moment too soon, says Peter Tanner, Founder of Boomcomms

The potential of the humble text message has been largely lost on the business world – until now. Yes, companies have used one-way SMS to confirm appointments or delivery times, or have experimented with the medium for advertising. The critical challenge they have failed to overcome, however, has been how to enable the recipient to respond in such a way that closes the loop and completes an automated database transaction.
Solve this problem, and the business possibilities are endless. Credit card transaction verification could be confirmed in an instant, without requiring the customer to call a helpline and wait endlessly in a queue. Engineers could sign themselves off site for health and safety purposes (and be prompted if they forget), or provide regular updates on the status of a job, automatically triggering the scheduling of new work.

Better than BlackBerry, timelier than Twitter
Fortuitously, a facility has recently been introduced to enable such transactions to be completed by SMS, without intermediary human intervention. The timing of this development is very pertinent, given the fragile state of the economy and the imperative for organisations to be able to do more with less.
While some of the above transactions could be completed using a BlackBerry and email or a special application, this requires a big investment, rendering the opportunity impractical for the majority of potential users. It also demands that the recipient is carrying the right device, and is tuned in to the right messaging medium when the interaction is initiated.
Such limitations are overcome by using SMS, which is supported by all mobile devices, used by the masses, and offers more immediacy and greater simplicity than mobile email or a specialist software application. Moreover, it requires no additional investment or training.
As the frenzy over Twitter continues to gather pace, the realisation of just what can be communicated in a targeted 160-character message is beginning to dawn on businesses. Requiring no special membership or opt-in clause, SMS offers such broad coverage for no extra investment that not exploiting the medium seems a waste. This is a tool any organisation (private or public), of any size, could harness, in just about any way they choose.

Curbing call centre queues
Simply add the two-way SMS facility onto an existing business process, and the automated workflow is successfully extended, boosting the customer/employee experience, without increasing costs. On the contrary, organisations stand to save many thousands of pounds by reducing the burden on call centres and redeploying staff.
The significant development making all of this possible is the introduction of a solution that couples an incoming text message with the original outgoing message. This means the content of the reply can be fed back directly into the organisation’s database so that the next step in the process can be taken - all without any human intervention.
So when a patient responds to their SMS reminder to say they cannot make a hospital appointment, a new appointment can be automatically issued and confirmed without the need for a series of phone calls. The patient has a much less stressful experience, and the health service avoids a wasted appointment and valuable administration time being diverted to complex rescheduling.

More compliant than voice exchanges
Even where the consumer is happy to make the follow-up phone call, voice-based transactions are much harder to capture for auditing purposes. SMS messaging offers a valuable advantage here, too, meeting compliance requirements by providing complete traceability of the interaction, including sequence and time information.
The real potential of closed-loop text messaging will be seen when the big software vendors and their development and integration partners begin rolling out applications with the two-way SMS facility already built in. To this end, it is no coincidence that we have already signed a major deal with Microsoft for our 2-way SMS solution, Boomerang. The deal will enable the software giant to exploit the technology with its partner community, and many other leading software publishers and developers are also showing a keen interest.
Applications already exist, too, which allow businesses to embed an SMS option into Microsoft Outlook, so that individual users can send and receive linked text messages via their PCs. This is achieved without the need for individual inbound numbers, which would be prohibitively expensive.

Bypassing voicemail
Given the relatively immediacy of a text-based interaction over email, or even a voice call (less than 50% of phone calls get straight through to the recipient today, thanks to voicemail and routine call screening), the ability to exploit the SMS option more readily as a business tool will be extremely useful in a work context. This applies equally to sales, customer service, distribution, and accounting or legal admin.
Once interwoven by a message thread, SMS messages take on a similar power to that enjoyed by email when first introduced – if not greater, because the population with a mobile phone is much broader demographically than that with access to email. Options exist to protect the anonymity of the sender and recipient, too, paving the way for online dating applications, discrete charity donations and so on.

Productivity progress
In this day and age, where immediate, live communications are considered to be at the centre of many critical business challenges, including honed productivity, sharper efficiency, and superior customer service, it is a wonder that SMS has remained untapped for so long. Existing applications have rendered the mobile handset little more than a dumb terminal, leaving customers frustrated, rather than delighted, because of the inability to reply with equal efficiency.
With the ‘reply’ conundrum addressed, SMS promises to be a small but significant revolution in the business-customer/business-employee relationship, breaking down boundaries, enabling direct interaction, and bringing greater speed and efficiency into the equation.
Embedded into either existing or new business processes, this simple, two-way, closed-loop SMS-based database communication mechanism offers a unique means of extending automated workflow – and, happily, without breaking the bank. In the current climate, who can argue with that?

Apps The Way To Do It

Hot on the heels of the launch of Nokia’s Ovi Store earlier this week, Jay Seaton, Chief Marketing Officer at Airwide Solutions offers operators 10 tips on how to successfully enter into the App Store market, without suffering some of the limitations the current app store models present

On Tuesday, Nokia launched the Ovi Store, its answer to Apple’s App Store. It was the latest in a string of similar announcements made recently by players across many aspects of the mobile value chain, from device manufacturers through to application developers and mobile operators, all looking to follow Apple’s lead and capitalise on the growing consumer demand for mobile Internet services.
When you look at the statistics, it’s easy to see why. A recent announcement by Vodafone anticipated that the operator would take a 30% share of revenues generated through consumers downloading apps on its network.
Yet while the app store phenomenon is clearly good news for the industry, for any app store to become a mainstay, operators must play a part in ensuring that the applications can be accessed by the mass market - despite handset fragmentation and existing limitations imposed on consumers without high-end Smartphones.
At Airwide Solutions, we’ve come up with a 10-point plan to help mobile operators make their play in the apps game, without suffering some of the limitations the current App Store models present. We're happy to share it with you.

1. Is the App Store model open for debate? 
Operators talk about replicating the App Store model, but can that be done when the model is still in its infancy? The reality is that there is no set model and no right way to go about it. The market will continue to see the model evolve over the next few months and years, and carriers should focus on enhancing app stores, rather than re-engineering them.

2. What does “enhancing” actually mean?
In order to stimulate additional revenue opportunities and reduce churn, operators should not only offer their customers a range of applications and services, but should also consider using the unique network assets, context and intelligence they have at their disposal to enhance those applications and services, helping them avoid being cut out of the revenue loop.

3. Should all apps be available to all subscribers or should carriers target apps for enterprise users and apps for consumers differently? 
A successful app store will be one that offers innovative applications to users no matter what their device or what their function. App offerings should not be limited to business (i.e.
Smartphone) users. Carriers must establish a model that offers device-agnostic, service-enhanced apps.

4. Relevance is king
Similarly, mobile operators should be careful to ensure the mobile applications and services they offer are cleverly targeted to subscribers, based on network intelligence such as information on location, devices and subscriber preferences.

5. How much is too much?
Operators shouldn’t underestimate their customer base. While there is a lot of competition among carriers, device manufacturers and developers to hook the subscriber on an initial app sale, all customers want the same things: ease-of-use, uncomplicated purchasing agreements, and most importantly, personalisation and customisation. Flooding the web and consumers with new app options is only as good as the services delivered with them, and that is the differentiator that carrier-driven app stores offer.

6. How do operators negotiate a revenue share with application developers to make an app store worthwhile?
Operators should think outside the box when it comes to mobile applications and find a way to layer services on top of third party apps for maximum revenue potential. Developers want viable entry points to subscribers and realise it’s ultimately the pathway to success, but mobile operators shouldn’t be afraid to break away from traditional service and content delivery models to make the collaboration with developers work.

7. Set the right foundations
Operators should be mindful of the mistakes of the past when deploying monolithic, technology-based infrastructure, and instead seek out flexible solutions to network upgrades which will enable them to seamlessly roll out services, without negatively impacting upon their current network architecture or services. It is this modular approach that will enable operators to pick and choose the services they want to roll out - and when - while also ensuring they future-proof their architecture.

8. AP-why?
Central to the success of building a long-term ecosystem for applications and services are open APIs that enable third-party application developers to integrate their services with an operator’s architecture. Truly open APIs for developer communities are likely to drive substantial application-based revenues.

9. Does it all come down to trust?
Carriers have an incredible advantage in the app store business to leverage the trust and loyalty of subscribers. Recent reports suggest that while Apple’s App Store saw a record number of downloads, most free apps eventually get deleted after the first download. There’s no staying power. Factor into that there is little tying a subscriber to third party app, and you have a very tenuous basis for repeat purchasing. Carriers, on the other hand, with long-term relationships and a trust factor unlike that on the web, can bring a new level of engagement between consumers and the apps they purchase. This is good for everyone. 

10. Sound the alarm!
As the number of applications and services increases, so too will the levels of spam and viruses. Mobile operators must therefore be careful to secure their networks and subscriber relationships by enabling a range of security services and parental control.

How To Design for the Mobile Web

Mark Westwater, Senior Usability Consultant at user experience consultancy User Vision, looks at usability considerations when designing mobile websites

As an industry, we are becoming increasingly aware that designing for the mobile web is not like designing for the desktop web. No longer is it acceptable to utilise a full function website across multiple platforms. Dedicated mobile websites are on the increase, but are still not sufficiently prevalent to make the mobile user experience a straightforward one for all.
One in five UK web users now browse the Internet using their mobile device, and according to Comscore, the overall number of mobile web visits has doubled in the last 12 months. Social networking has been a prime driver of this growth.
The basics, such as understanding that the mobile web is actually mobile, and not supported by the use of a mouse and keyboard as well a table and chair, mean that the designer can better appreciate the context of use and the types of tasks likely to be undertaken.
“Mobiles can be considered mini-computers but mobile apps are not mini PC apps” (Ballard, B. Designing the Mobile User Experience, 2006). Therefore, the mobile site should provide a subset of the full function and complement the main site or application.

Different tasks
Research has regularly shown that users undertake different tasks on a mobile, compared to the desktop. Information browsing, media viewing and sharing, social networking and emailing are among the main tasks currently performed using a mobile. Form-filling, detailed comparison websites and long document reviewing are difficult to facilitate, even for the most experienced user. This consideration indicates that providing a desktop webpage as a mobile webpage will present certain problems for the user including unnecessary information; overly detailed and complex information architecture and navigation; and slow render time across certain networks.
The developer needs to understand, through user research, what is required and what is achievable on a mobile device. Other content should remain on the primary site alone. On the flipside, how does the web developer decide what content to provide on the mobile web and how should the information architecture (IA) be presented?
It is not a surprise to suggest that the IA should be significantly reduced from the main site. The full extent of the IA is dependent on the target audience and their device set. Guidance is provided on the number of options per page and the depth of IA, but again, understanding the device groups and user needs will help to define this.

Link list ordering
The conundrum of link list ordering should also be addressed at this point. Priority, or most-clicked links, should be at the top of a list, in order to facilitate efficient access. It is recommended that the link hierarchy is regularly reviewed to investigate clickthrough, and to re-order where necessary. What should be carried forward from desktop web design is the provision of return links to ensure that efficient access back through the site is achieved.
The multitude of handsets available provides another major design crossroads. The variation in screen size, browser type and input method does little to assist the designer. What may look good on a smaller screen may be rendered poorly on a larger display. Content on desktop browsers may be uniquely presented on the many different mobile web browsers.
The solution is to understand the target audience and the devices they use. For example, if this is a business website or app, then designing for a PDA or Smartphone use would be most applicable. However, providing a numerical based IA would facilitate both keypad and touch interaction and may therefore cater for the widest audience.
There is little doubt the introduction of the Safari browser on the iPhone has brought the mobile web to many who had perhaps not previously considered it as a viable means of online browsing. It has also had a significant impact in bringing the year of the mobile web forward. It is true that Safari is revered by many, and has many positives, including the full screen view and straightforward URL entry to name but two. However, the zoom, scroll and select methods can present problems for some, and this can impact the user experience.
To make the most of your mobile site or application, do not redeploy your standard desktop design,  and try to fully understand the needs of your target audience. The most effective solution for web providers is to develop a mobile version of a site, redirect mobile users there, and not rely on the full page view that Safari provides. This approach will allow you to get the most from your mobile site and open the content to as wide an audience as possible. Why neglect mobile users when they are on the increase?

Focus on Indonesia

Hemant Kumar, Assistant Manager, Online Marketing and Advertising Sales at mobile ad network Mkhoj, throws the spotlight on Indonesia, which is fast becoming one of the world's largest mobile markets

Indonesia has been in the mobile advertising limelight in the recent past. The wireless user base in Indonesia recently crossed the 100 million subscriber mark, and is expected to grow to 146 million by the end of 2010. With this growth, Indonesia is set to become the third largest mobile market, after China and India. Insights into the region show that the demographics of Indonesia is a key contributor to mobile’s strong uptake in the region. Young people below the age of 27, who form over 72% of the population, have shown a high affinity towards the web, and are driving the bulk of the mobile web usage in this country.
Accelerating the growing success of mobile web is the poor quality of fixed line infrastructure, which is either unreliable, or completely non-existent in places. The mobile Internet forms the obvious surrogate, providing stable connectivity, at extremely cost effective prices. The operators in Indonesia are getting more competitive by the day and the data prices are dropping. In Indonesia, an average user browses 358 pages per month, well above the global average. Understandably, a vast majority of people are choosing mobile phones as the obvious choice for connectivity, and in many cases the mobile is exposing users to the internet for the first time.

Preferred medium
Indonesia ranks second in terms of Mkhoj’s network traffic, and has seen growth of 62% in the last quarter alone. In Indonesia, communities and content downloads form the top two traffic segments. It is only natural that mobile forms a preferred advertising medium in economies like Indonesia. The key is in educating our advertiser partners to the nuances of the region. Big players in the mobile industry have already taken to mobile marketing in this region. Indonesia has seen several successful campaigns, with various advertisers and publishers, who have enjoyed high ROI and monetization with the help of ad networks like us.
These days, mobile advertising is synonymous with emerging markets like Indonesia. The Indonesian government is also aiding this growth by giving incentives to foreign investors. The government is shifting its focus from larger cities to suburban areas and small towns by earmarking a part of the yearly revenues for the growth of rural areas. The sheer number of users, and the revenues being generated, confirm that mobile advertising is set to shift gears and zoom forward.

Backhaul to the Future

Viplob Syngal, General Manager, Carrier Networks, at NEC Europe, urges mobile operators to ensure their network infrastructure can cope with the seemingly insatiable trend towards launching app stores

Vodafone recently announced plans to launch an online application store this autumn. The store will offer software applications to its 256 million customers.
It is now clear that operators must provide their customers with mobile applications in order to remain competitive and create additional revenue streams. Not only that, but we will soon be seeing an evolution in the kinds of mobile applications demanded by consumers. Today, applications are centred around themes related to Mobile TV, simple games and multimedia, MMS, SMS, email, and Internet browsing. Over the next few years, however, we will see demand increase for more sophisticated premium applications, based on machine-to-machine interactions such as telematics, enriched navigation experiences and interactive gaming.
This is great news for operators, whose ARPU and voice revenue has been dwindling over the years, but they must appreciate the implications for the mobile network, and move to protect their customers from a second rate experience, whilst at the same time creating brand loyalty.

Achilles heel
The mobile backhaul network could prove to be the operators’ Achilles heel, and hinder the success of these app stores. Increasing backhaul capacity is imperative, and will allow operators to engage their customers, as well as keep data traffic costs in check. The speed of connecting to the Internet is a function of both the individual user's connectivity, and of the infrastructure. Fixed network operators have been caught out by this in the past, and mobile operators need to learn from their experience
Another area operators need to consider before counting their chickens, is that the Internet has created a whole new expectation around global connectivity, and if this is to be translated to the mobile world, users must be able to use the applications on all devices. Such openness will broaden the range of applications and services that can be shared, creating an enriched mobile broadband experience.
If Nielsen’s Law of Internet bandwidth, and Moore’s Law of computer power are to be translated to the mobile broadband world, then we should ensure, from the outset, that the overall mobile broadband ecosystem is ready to support the massive growth of mobile applications. In return, this will create the need for economies of scale and lower cost per bit.

Monopoly Money

John Strand, CEO of Strand Consult, argues that mobile operators should thank the EU for its intervention on roaming charges

In the media and in the EU, a lot is said about the intervention on roaming taking place. It will cost the industry billions of Euros, seems to be the consensus. At Strand Consult, we believe this approach will be costly in the short run, but in the long run, it’s probably the best thing that has happened to the operators in years, and the shareholders can start to rejoice.
One can view the intervention from many different angles: for its significance for the mobile industry; for innovation within the mobile universe; or for the many companies who develop, market and sell different communications solutions to the industry The mobile operators are not the only companies making a living selling communication cross-borders, far off. The EU just has not realized that.
One of our old heroes once said: “It is every company’s damn duty to try to establish a monopoly!” Some do this by developing products the customers are crazy for, others by being in the right place at the right time with the right product, others again do it by consolidating companies, or taking control of the supply chain.
When the EU took its decision to cap roaming charges, it was in fact helping the mobile industry in creating a monopoly on communication across borders, and a situation that will make it harder for alternative communication solution providers.

Cheap telephony
The fact is that is has always been expensive to call across borders. The liberalisation of the telecommunications market made it possible for other providers to offer cheap international telephony, circumventing the old monopolies. With the invention of the Internet and Skype, suddenly new ways of communication had arisen, and prices of international traffic dropped significantly. Simply put, competition, and the high prices charged by the old monopolies, created a sub-industry that also impacted the prices downwards. If regulation on international calls had taken place in those times, one might ask whether a company such as Skype or the many other IP companies or international telephony providers would have had arisen.
What’s going to happen now in the mobile market is simply that the prices of roaming falls, the politicians are proud of their efforts, and the many companies in the communications industry offering alternative telephony solutions or offering cheaper prices on roaming will have a hard time making a living. The venture capitalists will say that companies in this area are not as interesting as they were before, and customers will have a hard time seeing any benefit in using alternative communications solutions across borders. So the EU has created a foundation for a monopoly for the mobile operators. Not only do they offer roaming, but now also, competitive prices.
Normally it would be expensive and very hard work to create a monopoly, but in this instance, it is almost free for the operators. The low prices will mean growth in traffic as customers will change their attitude regarding the use of their mobile phone abroad. We have seen this before in Denmark, Sweden and Norway, when falling prices quickly were compensated by increased traffic and turnover.

Natural competition
What the EU has done is a prime example of the fact that regulation of a competitive market can be dangerous. When politicians regulate a competitive market such as the mobile market, they influence the natural competition which exists in the market, so that the market, so to speak, gets out of balance. In the next 18 - 24 months, we will see the hard evidence of the political system’s lack of understanding of price, regulating and the way the telco industry works. This will kill innovation at the same time as creating a monopoly for the mobile operators.
A lot of people say that roaming is a problem, but it is not only a EU problem, but one that affects all countries, especially the ones with large numbers of tourists. Historically, we know that the mobile operators first competed on cheap mobile phones, then it was cheap national traffic, then cheap SMS, and now, there is a lot focus on cheap regional traffic. Roaming should be next in line, and actually already is in a number of countries.
Our conclusion is that the EU, with Viviane Redding as Commissioner, knew that public recognition and votes lie in getting the customers cheap roaming here and now! However, either they forgot to tell the end users about the consequences for competition and innovation in the long run, or they simply don’t know what these consequences are. The EU has sent the biggest present to the European mobile industry they could have wished for - the foundation for a monopoly for communication across borders.

I Think, Therefore IM

Mickael Remond, CEO of Instant messaging (IM) company ProcessOne, argues that mobile operators should do more to push mobile IM services

Today’s mobile landscape is becoming increasingly competitive, and in order to gain market share and remain profitable, operators need to change their approach. Traditionally, operators have seen text messaging as their ‘cash cow’ so have tended to drive it more than other services. But with mobile handsets becoming increasingly sophisticated, users are demanding more feature-rich services. Mobile Instant Messaging (IM) is a great opportunity for operators, but not enough is being done to encourage its widespread adoption. There are a number of factors that operators must address in order to successfully increase adoption levels.

The challenges
The first challenge operators face is a lack of consumer awareness. Recent research from TNS, commissioned by ProcessOne, showed that 60% of mobile users would send fewer text messages if they were better educated on how to use mobile IM. This shows that there is a demand for mobile IM.
Most consumers are aware of IM, and at some point, have used it on their PC. But many are unaware of the benefits of having it on their mobile phone. Consumers have the basic knowledge to use IM, but they need to be educated on how to access it on their phone.
Another challenge facing mobile operators is network interoperability. Texting and mobile voice calls only took off when users were able to communicate cost-effectively with each other, irrespective of which network they were on. The same needs to happen with mobile IM, as users will want to communicate with friends and colleagues using a single IM service, rather than having multiple accounts for different networks.
Another possible reason for the slow adoption of mobile IM is confusion around pricing. The research by TNS found that 40% of the mobile users surveyed would prefer to pay on a pay-per-message basis. This is not surprising, given that text messaging is traditionally billed in this manner, and as a result, consumers are used to, and comfortable with, this billing approach. Consumers are also aware, however, that IM usually involves a larger volume of messages than texting, which can give the perception of it being more expensive.

Rising to the challenge
By taking the time and effort to clearly educate and convey the benefits of mobile IM, operators can begin to influence adoption levels. The first hurdle to address is the lack of consumer education. Operators need to discount any uncertainty that customers may have about it and actively promote the benefits, such as no character restrictions on messages, which can be a major frustration for text messaging users.
Mobile IM can also enable group chat, where users talk to a number of contacts at the same time, rather than engaging with each individually, saving time and money. In addition, users can send multimedia files much more easily using mobile IM.
The next challenge to tackle is network interoperability. Historically, when mobile phones were first introduced, it was cheaper to speak to contacts if they were on the same mobile network. But this needed to change in order for text messaging to be successful, and it is clear that interoperability will once again be a key factor in driving mobile IM adoption. If operators clearly highlight that mobile IM users can cost-effectively communicate with contacts, irrespective of what network they are on, they stand to attract new subscribers, as well as retain existing ones.
To go one step further, operators aiming to get the maximum benefit from mobile IM services should consider developing their own mobile IM client. Traditionally, IM services have been driven by providers such as MSN and Yahoo! But by creating their own-branded mobile IM service using ‘open’ platforms, operators can ensure network interoperability, while using their own branding to take advantage of the opportunity to sell additional services to their subscribers.
Lastly, to help speed up adoption of mobile IM, operators needs to show clearer pricing models that demonstrate its cost effectiveness for the consumer. Evidence shows that consumers are willing to use the service if it is priced correctly, so there is plenty of room for mobile operators to develop innovative pricing options. These could include flat-rate or micro-billing for add-on IM services such as file downloads, helping to increase ARPU (average revenue per user). 

Take action
Although mobile IM is a great opportunity for operators, there is still a lot of work that needs to be done before adoption becomes widespread. To help drive adoption levels, operators must tackle challenges such as education, pricing and network interoperability. Once they have established their user base, they can harness this demand to expose new business opportunities and increase revenue and drive profits. If the operators do all this, they can expect to see the benefits on the bottom line. 

Change. Or Die

Colin White, UK Chief Executive of Oxygen8 Communications, offers advice to newspaper publishers looking to make a success of the mobile channel

The steady decline in newspaper readership and revenue has accelerated dramatically over the past 12 months, with publishing companies seeing upwards of 80% of the value wiped off their shares. As the recession hits advertising revenues, particularly the classified car and property ads, there is growing pressure on publishers to fast forward their forays onto the web and mobile to drive significant incremental value.
And following the UK government’s recent announcement that all homes should have broadband by 2012, the writing is clearly on the wall for the printed page – both national and regional publishers need to take a radical look at their business strategy.
One strong point in their favour is that newspapers have strong brand value and are a  trusted product. But even for those publishers that have built up a strong online user base and brand, turning that audience into revenue remains a challenge for organisations still entrenched in the cultural attitude of the printed medium.

Classified opportunity
One of the key changes is a shift in model, most notably the move from paid to unpaid classified advertising. Rather than charging the advertiser to place a classified ad in the paper, publishers can now deliver classified ads to consumers via mobile phones, with each responder paying a small charge. By offering this free advertising model, publishers can reinvigorate the classified advertising market to deliver incremental value to the consumer audience.
Taking this approach, sellers can create ads using their mobile phones, including a photograph or video. Buyers express an interest by sending a text message to a Shortcode number which then prompts the release of contact information from the buyer to the seller. The seller also receives real-time alerts whenever someone responds to the ad.
With a flexible, scaleable mobile platform that can handle hundreds of connections and messages per second, publishers can manage numerous classified ads and connect hundreds of buyers and sellers simultaneously.
This real-time, two way communication between buyers and sellers encourages greater audience interaction, whilst also driving brand value and loyalty. It also provides publishers with unprecedented access to customer information, which can be used to support complementary product and service advertising around the main ad, maximising revenue opportunities.

New model
Mobile classified advertising, however, does not require the large telesales force associated with the print model. Instead, organisations will become increasingly reliant upon technology platforms to manage and automate the sales process, and the remaining sales staff will have to be retrained to deliver the new services offered online and via the mobile.
Furthermore, publishers need to recognise the need to leverage technology to co-ordinate both Internet and mobile advertising, to co-ordinate marketing across every platform, and to maximise the strong brand and existing online traffic. Operating increasingly in an international market creates new opportunities to grow the audience, but also presents challenges in delivering relevant promotions in different markets, undertaking affiliate marketing programmes and identifying new advertising partners across the globe.
This organisational and cultural change will undoubtedly be a major - probably the major - issue to address if publishers are to successfully tap into new revenue streams.

Local demand
It is also important for publishers to recognise the growing demand for local information. Local portals providing up to date information on towns, even villages, are becoming increasingly popular. They are also enjoying a huge increase in user generated content, thus minimising the operational overheads for publishers.
This localisation trend provides a new opportunity to offer location-based services for local advertisers, enabling them to exploit the location of the mobile user or the use of local IP identification with the provision of real-time, personalised offers. These simple services can deliver a significant revenue stream, with the additional benefit of using the strong customer data to drive further revenues in the future.
Indeed, there are opportunities to provide advertisers with richer data and richer marketing using online and mobile media than any publisher could ever offer in the printed environment. Furthermore, while the demand is for increasing localisation, publishers also have a far greater opportunity to leverage the massive global audience to drive significant revenue streams through global advertising and content syndication.

Global phenomenon
The shift in customer behaviour and attitudes to seeking news has been dramatic, and it is a global phenomenon, even in counties with low Internet penetration. From watching rolling news information online to the growing demand for local information, the old habits of reading the daily newspaper and watching the 6 o’clock news are dying out. 
With huge competition for advertising spend, the ability to offer a free advertising model to a strong user audience is compelling. Combined with in-depth customer information, the provision of simultaneous advertising and strong location-based services, this creates a powerful publishing model. It is now up to the publishing companies to make the staffing and operational changes required to maximise the new media marketplace.
But there is no turning back: if publishers don’t make organisational changes today and embrace new opportunities for driving mobile and Internet revenue, they will see further steep decline and may well end up out of business.

I Can See Clearly Now

Eran Hertzmann, Associate VP, Marketing for Mobile Advertising at Mobixell, argues the case for providing clarity to the mobile advertising value chain

It appears that the economic downturn is creating some interesting possibilities for mobile advertising. According to a recent report by analyst Analysys Mason, the prospects for mobile advertising in 2009 are promising, despite - or perhaps because of - the financial turmoil. More then ever, advertisers will require high-impact media that is highly personal and highly engaging. These days, customers are affected by financial pressure, and are willing to accept ads in return for low cost (or even free) content and services.
By definition, a mobile device is an ideal medium for communicating advertising messages and promoting a brand. Whether by SMS, a voice call or clicking on a mobile website, it is as an engaging starting point to customer acquisition or conversion. Due to the availability of context, immediacy, and personalisation, mobile has significant advantages over other channels as an advertising medium. However, as advertising buyers reconfigure budgets to suit challenging economic conditions, and mobile operators focus on keeping subscribers on board, it is critical that advertising agencies and brands, together with media buyers and technology vendors, agree on a business model that will make it viable for the media buyers to leverage the advantages of the mobile domain for the benefit of the brands.

Current approach…
The mobile advertising market is still highly fragmented, and media access is divided between the many off-deck players and carriers. There is no shortage of available operator inventory, although this inventory can be difficult for third parties to access. This inventory could be utilised for highly targeted and effective campaigns that pinpoint unique user segments in an enriching manner. But the mobile operator’s approach to the mobile advertising market is often varied and lacks clarity. Perhaps due to the fact that this is not a core function of the traditional operator’s business, it’s hard for them to market their inventory effectively, not just as chunks of SMS or MMS, but rather as meaningful audiences for marketers. This struggle to effectively market the inventory is the main reason that the majority of mobile ad budgets are currently spent on WAP banners, targeted only by the context of the hosting site. This clearly does not make the full potential of mobile advertising, where WAP consists of only a small part of available inventory, and where targeting could be personalized, rather than based only on the site context.

The way forward…
Therefore, what’s required is a model where all parties (operators, ad agencies, brands and media buyers) operate on the same basis. Operators must take the lead in providing access to their user base in a meaningful fashion. This means repackaging it from ‘SMS’ and ‘WAP’ to meaningful segments like ‘16-24 fashion females’, or ’30-plus gadget geeks’. Media Trading systems need to be put in place to provide widespread access to this inventory - starting naturally with large media agencies, but extending to include the growing sector of small and medium sized potential advertisers. This long tail group could be made part of the ecosystem once the digital trading market place is in place, and today it represents a large, relatively untapped, part of the potential advertiser base.
Another factor that needs to be addressed in order to realise the full potential of mobile advertising is to extend ad formats to become richer and more engaging, and to allow interactivity, leading to higher conversion rates. The combination of text and images, animation and high quality video is what is needed to provide an appealing user experience and one that is key for customer satisfaction.

Anonymity and privacy
The third, and most important prerequisite for the mobile operator, if they want to maintain their position as the subscriber’s trusted provider, is the need to maintain the anonymity and privacy of the user to the advertisers. The operators need to act as the privacy keeper, and form a wall between the advertisers and the users, so as not to disclose confidential information.
Recently, Mobixell provided a Polish operator with an end-to-end ad solution that featured an array of campaigns on its portal. The new service is carrying 20 different ad campaigns. Careful design and understanding of the customers helped generate an impressive clickthrough Rate (CTR) of between 5 and 25%. It is the careful match between customer segments and campaigns that helped achieve these response rates,  which are much higher than typically generated by Internet advertising. These results provide an early indicator of what can be done when ad agencies, brands and technology vendors agree on a business model. For each of the participants in the value chain, there are inherent benefits on agreeing to one approach such as this.  

Looking ahead…
In summary, effective participation in the mobile advertising market requires all parties to take action to clearly outline, and place a value on, their key assets for the advertising buyer. These centre on the subscriber data that mobile operators hold; on the trusted and personal relationships that they have with their subscribers; and in many cases, on the mobile brand, which can also be a powerful marketing tool. The more clearly that service providers can define these assets for media buyers, and enable advertisers, both large and small, to use them without impinging on the operator–subscriber relationship, the greater the chance that the growth of mobile advertising will bring maximum benefits.

Risky Business

Steve Denby, Commercial Board Director at JaywingDMG, examines the issue of risk and how mobile operators can make better-informed decisions about who they do, and don’t, want as customers

In the Christmas clamour to sign-up customers to mobile broadband contracts, many brands offered high-value freebies such as laptops as incentives. Following highprofile ad campaigns and promotions online and in-store, consumers rushed to take them up on the offers, only for many of them to be turned away, disappointed.
So what went wrong, and how can telcos use customer data to inform future campaigns, increase acceptance rates, and minimise the long-term impact of these too-good-to-be-true-offers?

Too good to miss
Against the backdrop of financial crisis and recession, the promise of a free laptop with every new mobile broadband contract was too good to miss, and consumers applied in their thousands in the pre-Christmas period. But many applications were unceremoniously turned down following credit checks – as many as three in four according to Broadband Expert. Clearly, these brands are right to be cautious in these difficult times, and they do need to ensure that customers can afford to pay up for the lifetime of the contract. But, are they doing enough to ensure the accuracy of their accept/reject decisions? A combination of the right data and decision rules could increase acceptance rates without taking on additional risk, maximising return on investment and ensuring a better consumer experience into the bargain.
Customers are often rejected, quite rightly, if a poor credit history is revealed during the application stage. However, a lack of available information is also a common reason for rejection, meaning there could be many profitable consumers being turned away. Not only is there an initial loss to the business by rejecting so many applicants, but refused applicants will have a negative impression of the retailer, and the mobile brands it represents; a negative association that is likely to remain for many years to come.
Such a desirable offer is tailor-made to appeal to people who couldn’t normally afford to buy a laptop, so there will be a natural tendency to receive a large proportion of applications from less ‘desirable’ (in financial terms) consumers. For instance, students are likely to be attracted by such a deal, but are most likely too young to have any history on file with the credit reference agencies. Some customer rejections are therefore inevitable, but with more data at their fingertips, mobile brands can make more robust decisions about whether to accept, and how to handle those they reject.

Risk decisioning
By changing their approach to risk decisioning, mobile brands can significantly improve their customer acceptance rates. In addition to information provided on the application form, data from one of the three UK credit bureaux (Experian, Equifax and Callcredit) are usually solicited, to check the applicant’s credit-worthiness. However, there are some significant differences between these agencies, both in the way name and address data are cleaned and matched, and in the completeness of each individual’s record. If a record can’t be found (a non-confirmation) the application is usually rejected; likewise, if there isn’t enough information on that person to make an accurate credit decision (they have what’s known as a ‘thin file’).
But by drawing data from all three credit reference agencies, it is possible to build up a more complete picture of each customer. So, where one agency alone may not find their record and another may only provide a thin file, by combining the data from all three you’ll have all available data at your disposal.
Taking this multi-bureaux approach can reduce the number of thin-file rejects by 70%. Furthermore, compared with using a single bureau, accessing all three can reveal around 40% more County Court Judgments (CCJs), and reduce the number of nonconfirmations by around 15%. So, by reducing the number of good customers you reject and rejecting more high-risk customers, you’ll get a much bigger return on investment from your marketing budget.

Alternative deal
Not only that, but this extra level of detail can be used to decide what to do once an applicant has been rejected for the initial offer. Maybe they are too risky to give them a free laptop, but that doesn’t necessarily mean you don’t want any of their business.
Detailed bureau data can be used to differentiate between applicants, so you can pick the ones you’d still like to have as a customer. They are in your store or talking to your call centre, they’re ready and waiting to buy your product – are you going to let them walk away, muttering about never doing business with you again? Or, do you apologise, but offer an alternative deal instead?
The opportunity for mobile brands to market ‘free gift’ offers well is in taking a more dedicated approach to risk decisioning. In doing so, brand and consumer alike can experience a positive interaction by entering into a contract based on a real understanding of risk and the customer’s suitability for the offer. 

When the Going Gets Tough, the Tough Get Texting

Alastair Shortland, CEO and Founder of SMS marketing company txtlocal, argues the case for SMS marketing in tough times

SMS marketing is proving just the tool for shrewd businesses look for innovative new media strategies to keep themselves ahead of the game during the economic downturn. SMEs feeling the pinch are searching for ways to cut marketing spend without compromising results. It’s now more important than ever for businesses to improve efficiency, reduce waste and produce targeted responsive marketing campaigns and digital media such as mobile are proving the ideal solution ensuring much needed return on investment.
In this article, I’d like to outline six key areas where mobile marketing can shine for any business.

1. Direct Response Advertising
For businesses feeling the pinch, return on investment is the key to ensure profitability. It’s now more important than ever to ensure advertising produces results, and while costly advertising campaigns may be great for raising brand awareness, they are not always the best option for businesses looking for quick sales and ROI. Targeted bulk text campaigns to a qualified database, coupled with a strong call to action, can prove powerful in reaching impulse buyers at just the right time to entice a purchase.
The key to using mobile for direct response lies in the fact people carry their phones with them wherever they go, and so there is no more powerful way to reach people than by their phone, and with 75% of people reading their texts immediately, the direct impact can be huge. Statistics from the Mobile Data Association (MDA) show that response rates for mobile are four times higher than other direct marketing media such as direct mail and email, and at only a few pence a text,  and no production costs, a simple text message is a fraction of the cost of other direct marketing media.

2. Customer Retention Marketing
Anyone with a qualification in marketing will know that long term clients are the most profitable. It’s now more crucial than ever to ensure that businesses retain the customers they already have. Keeping customers will not only save businesses money, but will make them money. According to a report by The Logic Group, loyal, longstanding customers account for over 50% of a company’s annual sales. They are also higher value customers, happy to pay premium rates of around 30% to 50% more per transaction. For this reason, a CRM program is crucial, and regular communication via email and mobile is a great way to helping maintain communication. Of course, no one wants to be bombarded with endless SMS marketing campaigns, but a friendly personalised offer or promotion at just the right time will do no harm to your relationship and could provide just the push you need to increase sales.

3. Viral Marketing
Viral marketing includes any strategy that encourages individuals to pass on marketing messages to others, and with virtually the entire UK population owning at least one mobile phone, it’s little wonder that mobile, like the web, is recognised as a great viral marketing channel. 
With people looking for bargains, text is proving more powerful than ever. Texts are the ideal viral marketing tool, capable of reaching far beyond the initial recipients. Good offers and promotions are often shared amongst friends eager to spread the word of a good bargain. If businesses send out tempting offers and promotions, then it’s only human nature that people will want to share them, and it couldn’t be any easier or more convenient to pass on a good tip to a friend than via a quick text. Also, people genuinely like receiving texts from friends. A survey conducted by txtlocal found that a whopping 94% of texts received by people are opened and read, which offers great opportunities for marketers.

4. Integrated Marketing
Mobile works best when integrated with other larger campaigns, and therefore it’s important for it to be integrated into all marketing communications material, such as newsletters, websites, e-marketing, POS, outdoor, TV and radio, in the same way a telephone number or email address would be included. This gives customers and prospects another medium  by which to get in touch with you, and one which many may view as easier than phoning or emailing. With a quick text, people can easily register their interest in a product or service. E.g “Text BROCHURE + your email to 60777” All inbound opt-in details are stored in your online account for further contact.
A punchy Shortcode is easy to remember and quick to respond to.

5. Lead Generation
So the question is, how can marketers obtain good quality leads at a fair price? The tightening economy is sure to put lead generation tactics in the spotlight, as businesses search for ways to generate new leads. Mobile marketing campaigns enable businesses to build their own opt-in database of contacts at no extra cost, simply by publishing the mobile response mechanism on all marketing communications material. This is a much more practical way of operating than buying in cold call data from a broker. Displaying a Shortcode should start to become standard practice for every business looking to generate warm leads to market to.
Just recently, one Txtlocal customer, a sandwich shop in Telford, grew an optin list of 1,500 customers in two weeks just by putting up an A4 display in their window.  This was free. They then paid £40 to send a text message to everyone on the list, and tracked a 49% conversation rate on a 2-for-1 offer.  They claim that it surpasses any marketing they have previously tried:  a £40 spend generated £400 profit on just a single promotion.

6. Measuring and Tracking Results
During tough economic times, it is more important than ever for businesses to implement marketing strategies that are trackable and measureable. There is no point investing in advertising if it’s not properly monitored. It’s important to track where sales are coming from, then analyse the statistics and drop what’s not working in favour of what is. It doesn’t cost anything to monitor where people heard of a business, and SMS text promotions such as 2-for-1 offers, free entry texts and buy one get one free promotions are easily monitored via visual or coded redemption mechanics. 
It’s also easy to monitor other aspects of text campaigns, such as how many texts are opened, bouncebacks, unsubscribes and clickthrough rates, all of which also need to be accounted for when monitoring campaign success.

Mobile marketing set for growth
Mobile marketing strategies are still unfamiliar to a vast amount of SMEs, but at Txtlocal, we have witnessed firsthand the growth in mobile marketing and are confident that the trend is set to continue.
As marketing budgets are streamlined, marketers need to push their case for value for money from advertising and marketing spend and move more towards more measurable, ROI-focused media such as Internet and mobile marketing. Mobile tactics such as Shortcodes and text messaging should be integrated into larger marketing campaigns as an aid to increase mobile’s potential in terms of sales, lead generation and campaign measurability.

The Case For Smartphone Security

Peter Harrison, CTO of mobile security specialist UMU, discusses the growing need to take Smartphone security seriously

No one would invest hundreds of pounds in security locks, deadbolts and alarms for the front door of their house, only to leave the back door wide open and unguarded. Yet this is an error many consumers make when dealing with their Smartphones.
While PCs and laptops are now protected by advanced firewalls and virus scanners, many consumers are unaware of the dangers to exactly the same data on their Smartphones. Worse still, there are few comprehensive security programs available for the platform and, because we carry our Smartphones with us at all times, these devices are more exposed to physical theft and misuse.
Five years ago, Smartphones could be easily dismissed as the preserve of business people and technophiles, but they are now increasingly popular with mainstream consumers. According to Gartner, Smartphone sales rose by 16% in 2008. This growth is being driven by a new breed of handsets, which are decidedly more consumer-friendly than those of old, with features like cameras, touch-screens and easy-to-use operating systems.

Dumb mobiles
While Smartphone users have quickly become accustomed to accessing the Internet, email and multimedia content through their phone, many still regard their Smartphones in the same way that they looked at ‘dumb’ mobiles or even landlines. This is something that must end, given that Smartphones can contain sensitive data like passwords, browsing histories, multimedia content and emails, as well as increasingly being used to access secure services such as corporate networks and online banking. While it is not always possible to stop a thief from stealing a handset, it is certainly possible to stop them from making calls and accessing any sensitive information it contains.
Aside from physical theft, Smartphones are increasingly vulnerable to malicious software and data theft. While mobile malware infections are still rare compared to desktop systems, with only around 500 identified so far, they can cause problems like file wipes, hard resets or unintended toll charges. And unfortunately, the barriers that previously restrained malware attacks on Smartphones are falling.
The varied, device-specific operating systems of Smartphones used to discourage malware writers, since they would require a great deal of effort to hack and would bring little reward. The move to Windows-compatible operating systems (or OS X on the iPhone) has changed this. Additionally, the increasing number of handsets means there will soon be a large and sufficiently lucrative market to attract the interest of malware writers, be they hackers, thieves or software developers angry at being made redundant. Faster 3G connections, Bluetooth and wi-fi are also making over-the-air malware propagation more common, while Smartphone access to email and the Internet exposes users to the traditional routes for malware infection.

Security software
Consumers must learn that as their use of mobile phones becomes more sophisticated, so the need to protect themselves with security software becomes more critical. Unfortunately, in the same way that it took a highly publicised virus to raise awareness amongst PC users of the need for anti-virus and firewall software, Smartphone users will likely remain unprotected until we face a serious threat. Nevertheless, malware such as the Yxe and Pmcryptic worms, as well as the Konov Trojan, have shown how easily they can spread across networks. Indeed, Yxe is even Symbian signed and so can be installed on 3rd edition devices.
The industry not only needs to act fast to combat the current threats to Smartphones users, they must also work now to head off future problems. For example, the rise of technologies like mobile NFC (Near Field Communication) contactless payments, which will allow mobile devices to incorporate the full functionality of credit and debit cards, will make hacked handsets far more lucrative for criminals. Some operators are already providing email and SMS filtering for mobile devices, regardless of their operating system. However, since malware can still spread using mechanisms such as Bluetooth, wi-fi and memory cards, operator filtering should not lull consumers into a false sense of security.
Meanwhile, however, it is imperative that consumers wake up to the risks their Smartphones face,  because, as we come to rely more heavily on our mobile devices and services like mobile banking become more common, the risks will continue to grow.

The Camera Never Lies

Ariel Avitan, Industry Analyst, Network Security Technologies at Frost & Sullivan, considers an innovative approach to mobile banking security and authentication

As many new technologies pass the proving stage, the burden falls then to organizations to implement these new technologies and get them into the hands of their end users. Banks and financial institutions are verticals that are always looking to increase the security of transactions, while at the same time lowering costs. In order to achieve this, they are trying to get a better grasp on everyday technology that will allow them to present and offer different options to existing and future clients. 
A good example for this approach is mobile banking. The services that are offered on mobile banking platforms provide both cost savings to the banks in human resources expenses and manual transactions, while offering time and cost saving benefits to the bank’s clients. To date, the mobile banking market has grown rapidly, having a CAGR growth rate of 4% and reaching an estimated $3.7 million (£2.6 million) in revenues in 2008. This market is expected to increase at an estimated CAGR of 14%, with revenues reaching $14.7 million by 2012.

Major restraints
There are some major restraints that are slowing the mobile banking market. Other than the general economic crisis, one of the primary restraints is the difficulty in authenticating the identity of the mobile banking user.
While e-banking has a lot of strong authentication methods to verify the identity of the user, such as tokens and knowledge-based questions, mobile banking has different usability needs, and is more prone to malicious usage, as mobile devices are easily stolen, which means that familiar, strong authentication solutions are not sufficient for mobile banking.
One company tackling the mobile strong authentication issue is an Israeli based start-up called Classifeye. Classifeye has developed a solution that not only upgrades the strong authentication that is in use today, but also uses a regular device to do so.
Classifeye has developed a solution that uses the camera built into the mobile handset. By taking a picture of two fingers with the camera, Classifeye’s solution can biometrically authenticate the user. This solution is a great way to upgrade the strong authentication most used today from the ‘what you have’ factor, such as a token, to a ‘what you are’ factor, such as a fingerprint in the two factor authentication method. Classifeye understands that in order to penetrate this market, there is a need to develop an authentication solution that is both easy to use, provides a higher standard of authentication, and has a very low error and false positive ratio.
A main vertical sector that could use Classifeye’s solution is the e-banking vertical. Most banks are thinking of distributing hardware or software OTP solutions to end users for conducting transactions. These solutions come with distribution costs, and added hardware and support costs. Having Classifeye’s solution will not only reduce the total cost of applying a two factor authentication solution, but will also upgrade the security, as this solution is biometric and harder to overcome.

New pilots
Classifeye is now working on new pilots with various mobile and financial organizations in Europe, as well as focusing on its main target, which is helping the micro-financing process in third world countries. With the help of Classifeye’s solution, micro-financing organizations are able to provide their clients with many more services, and enhance revenues from the existing clients.
Frost and Sullivan believes that solutions like the Classifeye solution will enable mobile banking to grow, while reducing the overall branch costs of the different financial institutes and enhancing the overall ‘iinstant’ services and offerings that the banks have today. These attributes are critical to the times we are experiencing now ,when cost reduction is a key driver in any product or service that is offered to the different markets.

The US of Spain

Nikolaj Grubert, Vice President of Strand Consult, offers a refreshingly candid and hard-hitting review of Mobile World Congress 2009

This year’s Mobile World Congress in Barcelona is over, and once again many of the telecom industry’s top management convened in Spain to exchange experience, knowledge and show their latest technological triumphs - altogether almost 47,000 people met in Barcelona. There is no doubt that the financial crisis has caught up with a number of the telecom infrastructure providers, but on the other hand, it does look like the actual telecom industry is not going to be hit quite as hard as many other industries - people are still using their telephones and most operators have a healthy cash flow and sensible earnings.
Attending the Mobile World Congress is always fascinating, and again this year, there were many opportunities to have serious debates with the industry leaders during the many conferences that were spread across the four days of MWC – and again Strand Consult also made our mark. Participating in the conferences enables us to find out whether our predictions were correct, and at the same time gives us an opportunity to read the signals that many of the industry's most important players are sending out.

American focus
One thing we could criticise is that this year's conference was very Americanised; there were many companies from the US, and a great deal of focus on how Americans perceive the mobile world and how it is developing. Let’s stick to the facts for a second; the US only has a limited share of the global mobile market, none of the American operators are global market players and the American infrastructure providers are finding it difficult to do business in this industry. In many ways, one could say that the US is just as successful in the car industry as they are in the mobile industry - perhaps not quite fair when you think of companies like Qualcomm and Cisco, but in general the Americans are good at IT, but not quite as good at telecom.
One of the exciting presentations at the conference was the one where Steve Balmer, CEO of Microsoft, Nokia Chief Olli-Pekka Kallasvuo and Ralph de la Vega, President of AT&T, presented their visions for the future. However, this year will be added to the list of years where Microsoft disappointed us. Steve Balmer is always fun to listen to, but on the other hand, it is sad that Microsoft's mobile vision is limited to ensuring that everything they have created on the desktop must be able to function on a mobile telephone. Where is the mobile vision where things are moving from the mobile over to the desktop, instead of in the opposite direction?
Olli-Pekka Kallasvuo’s Nokia presentation was okay, but he is a lawyer by education, and they are usually not the funniest people in the world. But at the end of the day, one should not judge Nokia on its presentation techniques, but on the products and services it offers, and in this respect, Nokia continues to announce a wide selection of products. If you examine how Nokia is performing compared to its competition, there is no doubt that they are in a unique position that is constantly being improved. Personally I liked Ralph de la Vega’s AT&T presentation, that showed an American operator that is starting to move in the direction that we believe the world is developing towards. This year's message was very clear - that AT&T has understood that the market is very fragmented and that different customer segments are demanding different types of products and services, and that it is an operator like AT&T's job to ensure that these products and services are available to their partners. The most interesting message was the announcement that AT&T is allowing access to its APIs, allowing third-party companies to create additional services on top of the AT&T network.

Mobile developments
After the three presentations, Walt Mossberg from the Wall Street Journal took the stage as moderator for what could have been an exciting discussion about the current mobile market and how it is developing. While there is no doubt that Walt Mossberg is a highly respected columnist at the WSJ, he appears to have the same level of knowledge about the global mobile industry, as George Bush had about what was happening outside the US. How can you spend the whole debate discussing the iPhone and the significance the iPhone has hand on the mobile market, in Walt Mossberg’s opinion, when less than 1% of the 4 billion mobile phones in the world are iPhones? In fact, even Opera Mini has been more successful measured in number of users, than the iPhone.
I understand that the US is currently experiencing difficult times, but to be so nationalistic and have so little focus on what is happening outside the US as Walt Mossberg had in that panel debate is sad, when it is happening at the Mobile World Congress. That discussion would have been perfect for the CTIA, but was close to a scandal when people come from every corner of the world to hear how some of the industry's most important people view the future in a global industry. When the world's top leaders meet in Davos once a year they talk about global development - not about US national politics.

Education needed
This year, there was a great deal of focus on mobile Value Added Services, and there were many good examples at both the conference and exhibition, showing that the number of useful applications is exploding, and an increasing number of people are using their mobile phone for applications other than just voice and SMS. What frightened us a little this year was the focus on Application Stores as a solution to the problem of some people only using their mobile phone for calls and SMS. Put somewhat bluntly, you cannot solve the problem of illiteracy by building bookstores. You need to educate customers and ensure that there are attractive products that they want to purchase and use. If you have no conception of the value of a book, there would be no point in learning to read - all parents know this as they go through the process of teaching their children to read.
Also this year, many were talking about Android, but where are the phones and how attractive will they be when they reach the market? If you examine what has happened since Google launched their Android vision, the developments have followed our original predictions, and there is no doubt that it will probably take some time before we will see some interesting handsets on the market. So far, Google has not produced any products that are especially commercial or even close to being attractive to the mass market. Google is very good at searches, but has still to deliver in the mobile area.

Mobile broadband
It was very obvious this year that the mobile broadband market is enormous and growing at a tremendous rate, and that LTE will be ready when the market starts demanding that capacity size. This market is developing along the lines we described in our report.
There is no doubt that mobile broadband has become a huge success, and millions of customers each month are buying one of these connections. We would have liked to see a little more focus on the underlying business models and the challenges mobile operators are facing due to the influence of mobile broadband on the DSL market - we know that mobile broadband will cannibalise a large chunk of the DSL market players’ customer bases.
The regulative challenges are enormous, and despite the attendance of 60 governmental delegations at the Mobile World Congress this year, it is important that the political system starts distinguishing between the IT industry and the Telecom industry, as described in this research note. It is important that politicians around the world perceive the telecom industry as an important tool to fight poverty, a tool that can help society become more efficient, and as an industry that can greatly benefit the environment. If I was a politician, I would examine how I could improve my society by using modern telecommunications.

Tough regulation
Basically, it appears that many politicians view the telecom industry as one that requires tough regulation, to help increase politicians’ popularity among their voters. On the other hand, there is little doubt that the actions of many politicians are proof that the telecom industry has not been especially good at selling itself - which became especially clear in Barcelona this year.
Many countries are talking about Green ICT or Green IT - why are we not talking about Green Telecom and what the telecom industry can do for the environment? There is no doubt that projects like the universal charger, and the fact that the telecom industry can make the world smaller, are subjects that should be on the agenda when talking about how we can protect the environment. In reality, the telecom industry is probably the one that can most benefit the environment today and if the world's leaders at the Global Climate Summit in Copenhagen in December chose to include the telecom industry's role in their agenda, the world might understand what the telecom industry can do for the environment. In case you did not know, the Telecom industry is not on the agenda of the Climate Summit in Copenhagen in December 2009.
Before Mobile World Congress, we predicted that this year's conference would be the moment of truth for many players in the industry - and it was. We saw those that deliver the goods and create value for their customers and thereby also value for their shareholders - and we saw those that believe that the MWC is about releasing as many press releases as possible with a high bull*!%* factor. We are certain that many of the latter companies will not be attending next year - unless they start learning from the industry leaders and start adjusting their businesses to the reality that we all are a part of.

Thumbs up
All in all, it is thumbs up to the GSMA for this year's conference. Overall, it was a good conference with a great deal of focus on issues that will benefit consumers and society. Next year,  it would be good to have a little less focus on the US and a little more focus on what is happening in the real world where all us others work - where the cash flow is being generated, and where 92% of the world's mobile customers live.
We look forward to next year's conference and would not be guessing, if we state that we will be seeing further consolidation in the market during the coming year. We will just have to hope that the political system will have a greater understanding of the industry that is basically creating the foundation of modern society.

All Change

John Strand, CEO of Strand Consult, explains why the launch of Opera Turbo, and the rapid growth in the mobile broadband market, will create a paradigm shift on the desktop web browser market

The desktop browser market is characterised by developing towards browsers that have an increasing level of functionality and that are becoming larger and more bulky. Likewise, many websites that visitors access using their browsers are also becoming increasingly bulky. The increased complexity and bulkiness of browsers and websites has been compensated, however, by faster PCs and the transition from dial-up Internet connections to DSL broadband.
In Strand Consult’s report ‘Successful Strategies for the Mobile Broadband Market’, we have examined this market development. The fact that mobile broadband is being sold as a flat-rate product - but with a maximum download limit - has resulted in completely new needs emerging from both operators and customers.
From the operators’ point of view, the success of mobile broadband has resulted in operators facing large investments in network capacity and in their backhaul (backbone) - the network that delivers broadband and capacity to the base stations. The colossal explosion in mobile broadband traffic has resulted in the whole mobile industry facing multi-billion infrastructure investments - investments that are growing daily as mobile traffic increases, and an ever-increasing number of customers use a mobile broadband network to connect to the Internet.

Data-compression solutions
During the many workshops we have held for operators around the world, we have experienced many operators asking for solutions that can limit or compress their flat-rate data traffic. We have taken a closer look at this problem in the analysis here.
In practice, there is no doubt that if you sell flat-rate connections, it is important to examine any way that you can either limit the amount of data traffic, or alternatively, create new sources of revenue.From a customer's point of view, it is important to optimise the available bandwidth when using mobile broadband and to get as much value for money as possible out of the data traffic included in the mobile broadband package. Basically, customers want to surf quickly and inexpensively - and it needs to work.
But the development we have been experiencing on the desktop browser market has not taken into account the development of the mobile broadband market, and the browser industry has not taken into account the needs of millions of mobile broadband customers in the short, medium and long-term. Strand Consult has had a great deal of focus on this issue, both in our workshops and in our dialogue with companies like Opera in Norway. This has been one of the main areas that we believe both operators and browser developers like Opera should be very focused on.

Opera Turbo
Last week at MWC, Opera announced Opera Turbo, a desktop browser that combines the widely-known Opera Mini compression technology with a desktop browser. This allows users to surf the Internet faster, while using less bandwidth, compared to a traditional desktop browser. At Strand Consult, we believe that the traditional desktop browser industry is facing a paradigm shift and that the browser manufacturers will need to address the millions of new mobile broadband customers that are choosing to purchase a new mobile broadband connection each month. Quite simply, both end-users and mobile operators will demand products with the functionality that Opera is launching with Opera Turbo.
The good news for the browser industry is that the experience from Opera Mini and from the many operator workshops that Strand Consult has held around the world shows that mobile operators have the ability and willingness to pay market players like Opera to allow their customers access to browser technology like Opera Mini and Opera Turbo. At the end of the day, operators need to limit their CAPEX, while increasing end user experience when customers use mobile broadband connections to surf the Internet.
In our mobile broadband report, we analyse the challenges operators are facing, and explain why an application like Opera Turbo will help create a paradigm shift for the traditional desktop browser industry. With the launch of Opera Turbo, the mobile industry will most probably experience a paradigm shift larger than we have seen with Apple and the iPhone. One thing is certain - there is a great probability that there will be many more people using browsers like Opera Turbo to surf the Internet, than people using the iPhone.

Reality Check

Jon Wade, Director of Digital Strategy for direct/digital agency Wunderman, argues that this is no time for marketers to experiment with mobile

Mobile is not the place to be in the UK this year. Marketers are not going to experimenting with mobile in such tough economic conditions, apart from in emerging markets.
Almost without exception, every mobile marketing presentation I have ever watched or participated in begins with hyperbole: 

“There are predicted to be 4,000,000,000 mobile phone subscriptions worldwide by the end of 2009”

• “More people in China have a mobile phone than live in the USA”

“24% of people would rather sacrifice their first-born child than contemplate an evening without their mobile” 

Whilst these things are undoubtedly true (apart from the last one, I made that up) and very impressive on the surface, those same presentations usually end with “<insert year> – is this the year mobile marketing goes mainstream?” Err, no. Not this year, definitely not this year.
Hidden, usually in the middle of the presentation, are the mobile Internet usage stats. Whilst mobile phones are ubiquitous, online usage via mobile in the UK is not. The latest whitepaper from comScore, December 2008’s ‘U.K. PC & Mobile Internet Usage Report’, makes interesting reading. As of July 2008, total PC internet users stood at 35.2 million people, representing 70% of the total population aged 15 or more. Mobile Internet usage stood at 12.9 million, a comparatively measly 25% of the UK population, even after they extended that population to include everyone aged 13 or more. This number also belies a distinct tailing off in this usage rate since May 2008. Compare this to the positively ever-forward-marching PC Internet usage, which is unrelenting in its push upward, showing an 11% year-on-year growth. It gets worse though for some marketers.
There is a distinct skew toward younger demographics using this medium, in common with early adopter patterns with other technologies. 56% are aged 34 or less, whereas the PC Internet usage sees a much more even spread of demographics. And what are they doing? Search, email and social networking are the applications with the highest growth profiles.

Reasons to be fearful
The reasons for this lack of adoption are actually, common-sense for anyone who has gone online on mobile to any degree. Speed of content loading is cited by the younger demographic as a key issue. Usability is the bug-bear of the older demographic. Cost afflicts both. Smartphones don’t solve any of these issues.
So, Generation Y are all over it (comparatively speaking). But, unless you are actively targeting Gen Y with a product that leverages temporal or geographic relevance, is a specific mobile marketing strategy the way to go? It could be argued that if search, email and social networking are the killer apps for mobile, your strategic approach for mobile should be nothing more than ensuring platform agnosticism in your strategies for those other disciplines.
To the subject of a global recession. In these tough economic times, there are much happier hunting grounds than making experimental forays into mobile marketing. There’s the good old, accountable, dependable “regular” internet for a start. Usage continues to rise, measurement continues to become easier and more accurate and return-on-investment continues to be proven. 
And let’s face it - marketing budgets are being slashed left, right and centre in this economic downturn. We all trot out the “spend now, benefit when we come out of the recession” argument but it doesn’t cut it with the FD does it?  “Benefit later? What if there is no later…?”

No time to experiment
It’s therefore my conjecture that 2009 is not the year to be spending what little marketing budget you’ve got left by experimenting in the mobile marketing space in the UK. That’s not to say that all brands should not do any mobile marketing at all, far from it. Mobile marketing can be very effective when used in a relevant and smart way. That is to say, when your target audience and product lends itself to it. However, my advice to brands would be to do so only if you already know what type of return you are going to get from it (to make that difficult FD conversation a little easier).
Those brands that have done their experimentation during happier times should crank up their investment in the medium where they can prove return-on-investment – but if you haven’t, now is not the time to be dipping your toe in the water. Better, look to “regular” PC-based Internet marketing that can demonstrate reach and return.
The exception to this advice, and there is always an exception (just like the mobile marketing presentation always has a number with at least nine zeros after it) is where you are marketing into emerging markets. There we are seeing rapid growth in the online population, fuelled largely through mobile Internet usage. In these markets, now is definitely the time to be experimenting…as long as you can convince the FD.

MWC - Beware the Hype

John Strand, CEO of Strand Consult, looks at the key themes likely to emerge from this year's Mobile World Congress, which starts on Monday in Barcelona

Next week, another Mobile World Congress (MWC) will begin, and once again many of the most important people in the mobile industry will flock to Barcelona to show their new products, exchange knowledge and share points of view. MWC remains the telecom industry’s largest get-together – a get-together that attracted 55,000 visitors last year.
Traditions are wonderful. Traditions are one of the things that maintain a certain level of stability in our lives. And if you work in the mobile industry, there is no doubt that attending MWC is a tradition that is hard to do without. Unfortunately, however, there are a number of people who will not be attending this year's conference. The financial climate and the increasing pressure on the infrastructure providers has resulted in many people either losing their jobs, or alternatively being asked not to attend the MWC.
If you choose to view MWC from a financial crisis viewpoint, it is not difficult to find the depressing things. We believe one should take a different approach to MWC, and look at how things will be in the future. We believe it is important to see how the mobile industry can help improve the world's financial economy and make daily life easier and more inexpensive for the many people, companies and institutions that use mobile solutions to streamline their work and every day lives.

Moment of truth
For many companies, the year 2009 will be the moment of truth, and we believe that those that are innovative and that can deliver new and exciting products that the market cannot do without, have a chance of being successful in 2009. We believe that those companies that can help operators, corporate customers and others in reducing their costs will also have the chance of selling their solutions on a difficult market. Simply put, one could say that the mobile industry's market players either need to justify their right to exist - or leave the business.
So what will we see at MWC in 2009? We have no doubt that once again this year MWC will produce a lot of hype. Many market players will use their PR companies to announce to the world that their solution is unique. Some market players will recommend using advertising-based business models to achieve success, while others will claim the path to success in the mobile world will be phones like the iPhone and Android-based handsets. Strand Consult disagrees with these market players.
To everyone who tries to hype their solutions, we can only say that they ought to read our analysis
www.strandreports.com/sw3501.asp
that shows that the iPhone is the operator's worst friend. In fact, our analyses show that 4.5 million Norwegians today spend more money on mobile services annually than the many millions of iPhone users around the world. So if we had invested in a company that was trying to create a market position by claiming that the iPhone would make them rich, we would most probably immediately replace the management!
The market in the mobile industry is not the 0.1% of customers around the world that have an iPhone, it is the 99.9% of the mobile customers that have other phones that the mobile industry is making a living from - and will be making a living from in the future. They are the customers that generate cash flow.
This year, we will learn that mobile broadband is not just a regional success; it is a global success, and the number of customers that are purchasing a mobile broadband connection daily is exploding. Mobile broadband is the fastest growing product in mobile history. Today, mobile broadband has become many people's primary broadband connection, and in many markets, customers are migrating away from DSL products and over to mobile broadband products.
It will be exciting to hear this year how the roadmap for UMTS towards LTE will develop, and how quickly this development will happen. We believe that LTE will be marketed as a natural evolution of UMTS, and we believe there will be a great deal of focus on the fact that LTE - like UMTS - will cover a wide spectrum, perhaps even an area wider than UMTS is covering today. There is no doubt that the future network will be a combination of UMTS and LTE. The question is however to what extent GSM will be phased out, and how WIMAX will develop in a world where the infrastructure providers are focusing on mass-market technologies. MWC 2009 will probably show that WIMAX is under pressure and that it is a technology that is standing in the shadow of UMTS.

Fixed-mobile convergence
There will most probably also be a great deal of focus on how fixed line and mobile will converge, or whether these two solutions should converge. We guarantee that a number of players will push towards fixed-mobile convergence. On the other hand, why should those two technologies converge and what would the business model be for these products? Are we talking about product bundling or technological bundling? Again this year, we will be hearing a good deal about UMA and femtocells. The question is whether the people talking about the solutions will also talk about the underlying business models. We are having difficulty in seeing the business models and understanding how a mobile operator can plan their network, based on the expectations of a number of femtocells within a certain geographic area.
We believe that infrastructure providers like Ericsson, Nokia Siemens Networks and Alcatel-Lucent will have a great deal of focus - and talk a great deal - about delivering equipment to operators that will be marketed as being forward-compatible. In other words, equipment that can be upgraded to new technologies as they are launched. Their main message this year will be how they can give operators increased value for their CAPEX, and how they can help operators reduce their OPEX. Companies selling hardware will send out the message that they can deliver the capacity the operators will be requiring over the coming years, and that they can deliver it so that the equipment can develop together with the customer and the market. The question arises whether this will result in operators being forced into taking a single-vendor strategy, or whether they can continue with a multi-vendor strategy.
There will be focus on capacity - and when we go home from MWC 2009, many will probably have realised that the largest data quantities will not be consumed on Smartphones, but on portable PCs. The number of new PCs with built-in 3G is exploding, and customers are flocking to buy these products, while an increasing number of operators are simultaneously moving their focus away from high-end phones and over to portable PCs with built-in 3G/HSDPA.
We do not believe that the tphone manufacturers will be forgotten this year, but compared to previous years, they will most probably be marginalised. It will be exciting to see how many new market players will emerge this year. We believe that a number of new players from the IT world will be giving the mobile world a go.

Mobile applications
We also believe there will be a great deal of focus on mobile applications, including how to use mobile applications, and how they can help make many people's daily lives easier around the world, at this year’s conference. There will be a great deal of focus on the usefulness of mobile applications, and we are certain that we will see many exciting and very useful applications and solutions at both the conference and exhibition.
There is no doubt that the usefulness of mobile solutions will be high priority. Mobile applications are about much more than simply mobile email, Java games and ringtones. We will see that the technology, bandwidth and customers are all ready to make use of the new mobile possibilities. In fact, we have no doubt that many companies can not only use mobile applications to streamline their business, but that companies and public institutions can also become more accessible and efficient by taking advantage of mobile applications.
This year there are a number of exciting presentations at MWC that all show how mobile applications are being used around the world. We will see how these applications are being used, regardless of whether people live in the Western world or in  emerging markets. The use of mobile applications and solutions is not a national or regional phenomenon, but a global one. We are looking forward to hearing about the many exciting cases.

Business models
There are 3 main areas - business models, business models and business models. But one other key thing is new technologies; how customers embrace new technologies and what possibilities there will be in the future. How that technological development will be financed is a completely different question. We hope that the financial crisis will make the many innovative market players increase their focus on the underlying business models. Those of us that still remember the recession the telecom industry experienced after the year 2000, when the telecom and IT bubble burst, can remember that the companies that survived that recession were those that focused on how to produce, market and sell their solutions based on a healthy business model. We believe that those companies that remember this in 2009 will have a large chance of returning to the Mobile World Congress in 2010. To the rest, we wish good luck on whatever path they choose to take.
Regarding business models, the largest discussion will be whether they should be based on direct billing, the relationship between the service provider and end user, or whether the operator’s billing system should be used to charge for the services that customers buy and use on their mobile phones, or for the mobile broadband connection that PCs use to go online.
At Strand Consult we have been working a great deal in this area, and we believe that the operator centralised model already known from the premium SMS market will spread to a number of other areas. We believe that we will especially see this model implemented on the mobile broadband services market. In our report, ‘Successful Strategies for the Mobile Broadband Market’, http://www.strandreports.com/sw3293.asp
we have examined this area and created the business model that we believe will succeed on this market. We call it the BCAP model (Broadband Content and Application Provider).
You can read more about this model here: http://www.strandreports.com/sw3584.asp.
There is no doubt that MWC 2009 will be exciting, despite the financial crisis. For many, the year 2009 will be the year where they meet the moment of truth and what companies will experience will be very much along the lines that we have written in our 2009 market predictions: www.strandreports.com/sw3516.asp .
We have absolutely no doubt that there will also be many companies that try to hype their solutions - on the other hand the question is whether these market players shouldn’t instead try to adapt their businesses to the mobile reality that generates cash flow.

RingBack Tone Advertising: The Case For

Last week, we ran a piece outlining our misgivings about Turkish network Turkcell’s ‘Tone & Win’ Ringback Tone (RBT) mobile advertising platform. Here, Turkcell Mobile Marketing & Advertising Division Head Melis Türkmen puts the case for the defence...

RBT is a high-value added service in Turkey compared to other European countries, in terms of subscriber penetration and revenue. Turkcell subscribers mostly use RBT or have the chance to listen to RBT when calling their friends. RBT is a 10 to 15-second slot of free space that an operator can use to generate revenue. So in Tone&Win, Turkcell is using this space for ad-funded content. It is not a space where Turkcell is putting out a 15-second radio spot and letting listeners hear our brand jingle. It is a space created for Tone&Win advertisers, including music and a brand message.
For example, in a Tone&Win campaign run by Whirlpool on Christmas Eve, listeners heard an actress wishing them a Merry Christmas, and more than 2,000 Tonics (Tone&Win members) set this entertaining jingle as an RBT for their mobile phones. Each time the member received an incoming call, the person calling them heard Whirlpool’s ‘Merry Christmas’ greeting. The brand jingle was about 15 seconds long and consisted of a simple Christmas greeting.
And when Isbank, one of the biggest banks in Turkey, ran a Tone&Win campaign, their message was “Hey you know what they say: A good year ends with a good start! So your friend hired me to send you his best wishes!”
We are following popular Turkish blogs and forums and it’s really interesting that users are happy to listen to these kinds of advertisements instead of a regular ringing tone, and they know that their friends win credits or talk time for that. A 338% increase in monthly subscriber numbers to Tone&Win also proves that this growth is being  supported by word of mouth recommendation too.
And when it comes to the opt-in process for Tone&Win, according to telecom regulations, it is forbidden for us to analyze the caller information, so we cannot reach the callers for opt-in purposes. But we are working on a development that will give rewards and benefits to listeners, and this will launch very soon. That development will make it legitimate for us to reach listeners for opt-in/opt-out purposes.

Busting the Mobile VoIP Barriers

Despite 100 million mobile Voice over Internet Protocol (VoIP) users being predicted by 2011, mobile VoIP is still a long way from achieving critical mass.  Rodrigue Ullens, CEO & Co-founder of Voxbone, looks at what has slowed the uptake of mobile VoIP, and identifies how some recent innovations in the telecoms market are helping it to break into the mainstream

Since 2007, many people have said it is the year of mobile VoIP, yet here we are in 2009 and it is still to come of age. Three main factors have prevented mobile VoIP from achieving this critical mass. The first is regulatory. When mobile networks are compared with their fixed equivalents, it quickly becomes apparent that there is a huge difference in the level of liberalisation. Any telco can set up its own fixed network, obtain numbers from the regulator, have the numbers implemented by all other carriers, and have all of these number ranges considered equal. These are then included in unlimited package deals from the fixed and wireless carriers. With mobile networks, however, it is not universally possible for all mobile VoIP providers’ numbers to be reached from a landline or mobile phone and these numbers are often outside of the inclusive call minutes which come with your mobile phone contract.

Complex applications
The second factor - partly resulting from the regulatory environment - concerns complexity. At least 90% of people who turn to a mobile VoIP solution most probably do so because they want cheaper calls. But, make it difficult to download and use the application, and people will abandon it in favour of their traditional service. Generally speaking, mobile VoIP providers have been unable to come up with a solution that does not involve either software that is tricky to download to a mobile phone, swapping SIM cards, a complex calling system involving callback, or other, similar tricks. This has resulted in many consumers deeming these services to be far too much hassle. This is now changing, however, as a result of the Mobile Application stores, such as those provided by Apple, RIM and soon, Nokia. These stores make it much easier for consumers to discover and download mobile VoIP applications onto their phones, removing a barrier to people trying a mobile VoIP application in the first place.
The final problem has been the sheer number of distinct mobile VoIP providers on the market. While just five mobile network operators have obtained spectrum in the UK, there are scores of mobile VoIP providers, each with their own significant, yet relatively small, user-base. This creates a problem for two reasons. Firstly, it becomes very difficult for a consumer to decide which mobile VoIP service to use, as different offerings will perform better depending on when and where they are used. Secondly, it proves troublesome when a consumer finds that their friends are spread across two or more different providers and they are unable to call friends on other networks.

Area code for Earth
In fact, this no longer needs to be an issue, as last year, the International Telecommunications Union (ITU) created the country code +883. Consequently, we now effectively have an ‘area code for Earth’, which means that it is possible to bridge the gap between the separate mobile VoIP islands. For example, calling between the likes of Truphone, Jajah, Rebtel, DeFi and Gizmo5 is now possible, as they have all become part of the iNum community. This makes these mobile VoIP services reachable to a much larger number of users, and much more desirable to consumers.
None of the above recent innovations in technology are the Holy Grail to instantly enable mobile VoIP to fulfil its promise and to achieve critical mass. The next long term aim must be to bring about evolutions in the regulatory environment to enable a mobile sector in which we can better foster innovation, competition and cheap calls. Were regulators to ensure that any telco could have access to the spectrum to provide a wireless service, and were all telcos required to implement (and treat as equal) each others’ mobile numbers, this would dramatically lower the cost of all mobile calls. Furthermore, there would be no need to put a further cap on roaming fees and the cost of SMS as the EU is doing now.

It's All About the Offer

Alon Werber, VP, Marketing and Business Development at Pontis, offers advice to newtork operators on successfully cross-selling and up-selling to their customers

The battle to win the hearts and minds of the mobile user is bringing new challenges, but also huge opportunities for operators. In addition to rapid churn rates and high customer acquisition costs, marketers are faced with an economic downturn, therefore it is essential that marketers use the tools available to maintain customer loyalty and retention, whilst maximising ARPU.
The key to building relationships is to present consumers with services and offers, which meet their requirements, at the right time. Essentially the key is thinking ‘What’s next?’ Instead of predicting users’ wants, operators must adopt a system which acknowledges a response, or lack of, and keeps the dialogue open, whilst executing offers in real-time. Gartner forecasts that within three to five years, up-sell, where you offer a higher priced version of the product; and cross-sell, where you offer a related product, will soar. So how can marketers implement these to ensure return on investment?

Analyse Everything
Get your facts straight. Whilst it is stating the obvious, operators often fail here because they don’t have the right tools. Current and past behaviour are the best predictors of future action; to up-sell and cross-sell effectively operators must monitor usage in real-time to enable behavioural-based targeting. Some may think this approach is both difficult and costly to implement. Yet with the development of tools, like the Pontis Marketing Delivery Platform, which can harness data and execute offers in real-time, this can be addressed, enabling operators to launch personalised, perfectly timed offers, increasing the chances of uptake, whilst improving customer experience.

Know your customer
Many operators claim to understand the importance of personalisation; however they often fail to deliver. Users won’t purchase or subscribe to a service if offers are irrelevant or delivered at the wrong time. Furthermore, if users are bombarded with irrelevant offers, there’s a possibility it will be seen as spam. To prevent this, operators should follow online providers who have maximised the potential of personalisation, with ‘Amazon-like’ recommendations, linked to users’ preferences and real-time behaviour.

Timing is everything
Timing is critical; opportunities can be missed if operators don’t react in time – meaning lost revenue and potentially alienating users. When a customer buys a ringtone, a cross-sell should be offered before the purchase is completed - not weeks later. Even if the customer isn’t in the purchasing process, this doesn’t mean they could not be tempted by an offer. For example, with pre-paid mobile customers, operators should offer a silent customer, with a low balance, a top-up benefit. This can improve response rates and ARPU.

Highlight products being left behind
An advantage with cross-selling is the ability to promote products which consumers would buy if they were correctly marketed. When products launch, they may be bestsellers, but over time, interest wanes; this surge of revenue is the Short Head. Yet the less popular products can deliver consistent revenue when offered alongside the latest content; this is the Long Tail and allows operators to cross-sell products left behind. When a customer is buying the latest remix of a song, it is the perfect opportunity to cross-sell the original version. The theory is that the Long Tail, over time, will equal the Short Head; that collectively, many products account for as many sales as the few bestsellers. By using these factors, operators can turn on-the-fly promotions into optimal marketing offers.

Conclusion
So, to be able to run marketing offers you need current statistics of all your products. By implementing effective marketing tactics, operators can analyse results in real-time and measure any reduction in consumption; giving ample time to rectify problems and turn them into a positive outcome.
Central to this is having full view of each customer’s profile; that is, visibility of preferences and behaviour in real time, so that offers are personalised; and the ability exists to tie analysis to execution capabilities. Knowing what a customer is doing is helpful, only if you can act upon this knowledge, by offering a benefit or service. This is the key to ensuring that cross-sell and up-sell activity delivers optimum results, driving revenue, improving customer loyalty and reducing churn.

Barack to the Future

Chris Lennartz, Vice President of Product Marketing at Airwide Solutions, considers what impact Barack Obama’s presidency might have on the mobile industry

President Obama’s election campaign was one of the most talked about in history,  not only because of the barriers it broke down in terms of race, but also because of the innovative ways in which it engaged with the electorate. In many ways, it was a turning point for mobile messaging, employing the most coordinated text messaging get-out-the-vote campaign in US history. His campaign tactics were also a telling indication of the emphasis his administration would place on communications technology.
Despite many high-priority national, international and economic issues to tackle, speeches given over the last several weeks show that Barack Obama has not abandoned his commitment to shaking up longstanding communications policies in an effort to bridge the digital divide once and for all. He has already pledged to extend broadband to every US community through a host of initiatives, including ‘better use of the nation’s wireless spectrum’.

Competition intensifies
Although it is difficult to definitively predict what impact this will have on the mobile industry, what we can say is that if his ambitious plans for broadband investment go ahead, competition among US mobile operators will certainly intensify. However, whilst it is likely that Obama’s administration will introduce incentives to attract new broadband entrants, many predict that it is also aiming to support existing mobile operators by giving them access to the Universal Service Fund to help expand their networks to remote and rural areas.
It is all part of the plan to create jobs, allow more people to use the Internet and improve the USA’s international standing in terms of broadband penetration, where it has fallen from fourth in the world to 15th.
But whether or not Obama opens the floodgates for mobile telecoms, he has already done wonders for the profile of the humble text message. For the first time, SMS played a key role in a US electoral campaign – and to great effect! He used text messages to promote new speeches, important TV appearances and major rallies. And they worked. They proved effective in reaching voters, particularly those born of a generation where text messaging has become part of everyday activity - the under 30s.
In an effort to get out younger voters, Obama also developed a mobile page that allowed supporters to download ringtones and wallpaper, sign up for Twitter updates, and receive text messages with policy updates, campaign events and voting reminders. Innovatively, the campaign also had the foresight to register a common short code (CSC) that numerically represents the word ‘Obama’ (62262). This code was used during the mobile message alert opt-in process and delivered to subscribers issue-specific updates on subjects such as healthcare policy, education, and the war in Iraq.
Other organisations have followed. Just recently, for example. Save The Children in London sent over 100,000 SMS petitions to the English government, protesting against the war in Gaza.
Not only that, but the number of people who want to use web-based applications for their mobile phones is increasing, with SMS often used as the communication bridge to make the downloads possible. However, whilst the uptake of mobile applications and services increases, the king for mobile operators is still SMS. Recent research conducted by comScore M:Metrics on behalf of Airwide Solutions revealed that the number of people sending text messages across the EU is growing 3.3% year on year, a figure only beaten by MMS, which is growing by 9.2%.

Innovative applications
Such a high penetration service provides the perfect opportunity for operators to differentiate themselves, adding innovative applications and services which marry the possibilities of the Internet with the specific ultra-valuable capabilities of the mobile network. SMS also provides the perfect medium for mobile advertising campaigns, with its unrivalled reach and personal connection to the user. Out of office, auto-forward and storage/back up capabilities are also helping move SMS further into the lives of users and, due to its reliability, into the business world, for banking, tickets and billing.
While it is very difficult to predict what the future holds, it benefits mobile operators to prepare, by ensuring that their infrastructure is flexible and scalable. By breaking down traditional messaging infrastructure silos into separate, scalable tiers, operators can respond to market conditions and launch new services as and when they need to, to meet customer demand. They can take advantage of all the revenue benefits of rolling out new messaging types while mitigating the risk of building a dedicated infrastructure for an unproven messaging type. Many operators are already taking these steps and will find that they have transformed their legacy infrastructure into a future proof one that is prepared for the future.

Horses for Courses

Steve Ives, CEO at Taptu, argues that mobile specialists understand the mobile market as well as, if not better than, companies whose background is on the web

The last ten years have been Google’s decade. The company has revolutionised Internet search and pushed the boundaries of innovation in every area that it operates in, even getting its name in the Oxford English dictionary. Google’s dominance of online advertising is undisputed, but is the king of the PC screen also going to dominate the mobile screen?
Naturally, Google’s CEO Eric Schmidt thinks so. In June 2008 he revealed his wider ambition; to change the world and set a clear focus on mobile for the next three years. Speaking on CNBC in August 2008 Schmidt said: “we [Google] can make more money in mobile than we do in the desktop, eventually...”

Massive opportunity
Schmidt’s prediction about the expected explosion of mobile search and the mobile advertising market is echoed by several key analysts. Gartner predicts the mobile advertising market will reach £12 billion by 2011. Without doubt, the mobile device presents a massive opportunity that has not been seen since the birth of the Internet itself.
Google is such a powerful brand, that when it comes to talking about its vision and market predictions, people often get carried away, and some interpret this to mean that Google’s success on the desktop will be mirrored on the mobile. At this pivotal moment in the development of the mobile web, perhaps we should resist the temptation to assume history will repeat itself on mobile.
Take mobile social networks for instance. Yes, we’re seeing significant usage on mobile of the desktop social networks like Facebook and MySpace, but we’re also seeing the pure-play mobile social networks like Itsmy, MocoSpace and Peperonity taking significant share. According to the ‘Q1 Mobile Report’ published in May 2008 by Opera, MocoSpace is number 3 in the US, with Facebook sitting at number 5.

Striking differences
When it comes to search, the desktop and mobile share some common issues, but also have some striking differences. As on the desktop, the sheer volume of sites available on the mobile web is overwhelming, and unsurprisingly, we’re seeing search establish itself as the navigation interface of choice. Unlike the desktop, however, the mobile is awash with different screen sizes, codecs and protocols. This lack of standardisation means that a ‘one size fits all approach’ to search is unlikely to work.
On the desktop, the job of a search engine is fairly simple, as pretty much all websites can be viewed by most computers accessing them. But on the mobile, things are different. The user experience depends on the specific device and network being used. The key is to optimise for hundreds of different devices and prioritise search results according to mobile friendliness, thereby ensuring that users can find what they want, quickly and easily.
When it comes to marketing on mobile, search is, and is likely to remain, a powerful and significant channel for brands to reach their target audiences in a relevant and efficient away. We’re already seeing some evolution in the conventional desktop PPC (pay per click) advertising model as it migrates to mobile. For example, click-to-call and click-to-locate. 

Other opportunities
There are also other opportunities available. For instance, your mobile is with you all the time and is usually the first port of call when you’re trying to fill some time – just watch kids on a bus journey home from school. In this mode, users are very receptive to advertising, providing it’s targeted and relevant, and this presents a new opportunity.
It’s all very well to offer standard formats, but it is also important to focus on evolving new formats, and ways for brands to engage with mobile users. The mobile is the most personal, pervasive mass-market consumer device ever seen, and there is definitely further scope for developing new mobile advertising solutions.
So if you’re thinking about advertising on the mobile, then consider some of the pure-play mobile services and mobile search providers on the market. You might be surprised by what they have to offer.

No SOS for SMS

William Dudley, Group Director, Messaging & GRX Products at Sybase 365, argues that reports about the demise of text messaging are premature

Recently, industry media have been abuzz with headlines, blogs, and articles regarding the imminent demise of SMS due to cannibalization by Mobile Instant Messaging (MIM). Most often, they were quoting a study from TNS Global Telecoms Insight (GTI) that states that instant messaging will ultimately displace SMS (and to some extent, email) as the primary non-voice P2P communications medium for mobile phones.
While the study and its methodology are both sound, the conclusions drawn may be slightly flawed. MIM has yet to take on the viral attributes of SMS. For those who use MIM frequently – most likely within their own community of friends and associates - it may work well, and these particular users may very well use less SMS and more MIM. However, the simple fact is that until MIM and instant messaging overcome their fractured  mass of incompatible communities (e.g. AOL IM, MSN IM, Google Talk, ICQ, and of course the GSMA's Personal Instant Messaging [PIM]), they will not have the same mass global appeal that SMS has enjoyed for the past few years.

Solid growth
In the United States, SMS continues its solid traffic growth, with a doubling of traffic volumes from first quarter 2007 through first quarter 2008. M:Metrics reports that SMS subscriber usage in the US has reached approximately 50% penetration. In Western Europe, subscriber usage ranges from the high 70s to mid 80%. MIM usage rates, on the other hand, are still quite low, averaging less than 5% of the Western European subscriber population, with a better showing at 8% of the US subscriber population. Drilling down even further, one can find that MIM usage among surveyed subscribers is even lower for operators purported to have launched the GSMA's PIM, with the highest service usage usually MSN's instant messaging service.
Still, according to the M:Metrics data, when looking at the growth of the US subscriber population using MIM at least once per month over a one year period, we see a growth rate of 21%, while over the same time period, SMS grew 23% to almost 50% of the subscriber population using it at least once per month. Given the substantially larger base of SMS users, the 23% growth rate is essentially non-comparable to the 21% growth of MIM use with regards to the numbers it represents.
Additionally, accounting for a doubling of volume, while the number of subscribers that use SMS only grew 23%, it is evident that the frequent SMS users are sending even more messages. While several other countries have even stronger MIM usage among subscribers  - China, for example, grew to 11% of their subscribers using MIM in February 2008 - this does not show signs of the viral growth patterns that SMS has demonstrated previously, and still does in many markets. Consequently, any talk about the demise of SMS as a simple, non-voice medium is speculative at best, and misleading at worst.

Universal access
SMS provides a level of ubiquity that MIM will struggle to achieve. While Internet access from mobile phones is not yet universal (but is becoming more so with the greater prevalence of 3G networks), one would assume that this does in fact, bode well for MIM, and badly for SMS. Indeed, the TNS GTI press release states:
“The cost of instant messaging is next to nothing, as the only cost is a very small data transfer fee. With consumers being accustomed to instant messaging from their PC from companies like Yahoo and Microsoft, and more mobile operators offering unlimited use of web browsers, the take up of MIM is going to increase significantly - leaving SMS and fixed email from PC behind.”
And indeed, if one takes a look at some of the 3G-only operators, such as Hutchison-Whampoa in the UK, M:Metrics shows the MIM usage as 11.4% - one of the highest in Western Europe, which appears to support TNS's conclusion that SMS and email are left behind as MIM increases. Equally, however, we see that Hutchinson-Whampoa's SMS usage by subscribers is also amongst the highest in Western Europe - as are its usage of email, MMS and other Internet-driven services. This tells us that the 3G-only network subscribers are heavy users of both Internet and traditional mobile messaging services. While the Hutchinson case is only one operator example, this type of higher MIM usage shows that the reality is such that even where MIM is well-used among subscribers, it still has not, and will not, cannibalize SMS traffic anytime soon.
Finally, as we look to the future, we are already seeing IM-like features creeping into the SMS ecosystem, combining some of the desirable features of IM, such as presence and threaded messages, with the ubiquity, reach, and simplicity of SMS, and further discrediting the notion that MIM will displace SMS any time soon.

Reasons to be Cheerful

KF Lai, CEO of mobile social network BuzzCity, looks at the prospects for mobile advertising in 2009

Advertisers are now realising that mobile phones are not only widely available all over the world, and across all sectors of society but, what’s more, are very personal devices, making them a powerful channel to deliver highly targeted and relevant information. New technology means responses to mobile advertising can be tracked back to specific campaigns; for example, it is possible to accurately measure clickthrough rates and provide detailed analytics of pages browsed. Furthermore, with the ability to effectively target campaigns to users with particular interests, or who are in specific locations, many more marketing agencies will begin to recommend the mobile channel.
Despite today’s dismal economic outlook, I believe that 2009 may just be the breakout year for mobile advertising. As I’ve written before, I do not see the mobile advertising business being affected in a significant way by the global credit crisis; with rate card costs falling and budgets for the more traditional marketing techniques being squeezed dry, mobile has real potential to cut through the noise this year. That said, just what does this year hold in store for mobile advertising? And what services should brands expect from their advertising agencies and ad network providers?

Broader mobile strategies
First of all, more brands and marketing agencies than ever before will adopt mobile advertising and broader mobile marketing strategies. Contrary to the belief among some sceptics that mobile will remain simply an experimental means of reaching new customers, I believe that advertisers will increasingly recognise that the medium provides unprecedented targeting capabilities, due to the personal nature of the mobile phone. Banner advertising via the mobile Internet in particular is set to be big this year, with its opt-in and non-intrusive nature making it both a targeted medium and one that does not violate consumers’ privacy (contrary perhaps to push marketing via SMS). These distinct advantages will continue to prompt both big brands and smaller businesses to adopt mobile advertising as part of their marketing mix during 2009.
Mobile advertising rates will also continue to fall in line with other advertising methods, making it even easier for marketers to integrate mobile with their overall advertising plan. Those of us in the industry are already seeing this happening across the board, with mobile advertising rates gradually decreasing and “normalising” due to increasing inventory and the rapid expansion of the mobile Internet.
On that note, use and awareness of the mobile Internet will continue to grow throughout 2009. Whereas Smartphones like the iPhone and the Blackberry have helped generate increased usage of the mobile web in 2008, people with phones that are less feature-packed will also begin to discover the utility of the mobile Internet in larger numbers, further expanding the reach of mobile advertising this year.
That said, falling data prices and the increasing ease-of-use of mobile software and applications we should see will further encourage consumers to adopt the mobile Internet as part of their daily lives in the UK and across Western Europe. I have seen huge growth in mobile Internet usage and mobile ad impressions in multiple countries when this happens. It has helped propel the growth of BuzzCity’s mobile advertising network, resulting in more than 18 billion paid ad banners being served globally. In 2008 alone, we’ve recorded 200% growth in the number of paid ads served, with most of that growth coming from countries where data plan rates have dropped considerably.

Enhanced metrics
As touched upon earlier, however, perhaps the most important step forward in mobile advertising thus far is enhanced mobile campaign metrics, analysis and targeting. This is going to be absolutely critical to the success of the mobile advertising medium moving forward, and companies involved in the mobile advertising and marketing businesses understand this. I speak from experience, as the head of a company that runs a mobile advertising network. Although we offer our clients - both agency and direct - tools for targeting potential customers by all-important general demographics, we are continually working to hone targeting capabilities for our clients, something we are particularly focused on for 2009.
In summary, all signs are pointing toward a big year for mobile advertising. The combination of the overall growth of mobile Internet usage, increased recognition of mobile advertising as a measurable and effective channel, and the recognition that there is a need for enhanced tools for advertisers, should combine to help mobile advertising find a large and growing audience among increasing numbers of advertisers in 2009.

Roadblocks on the Mobile Broadband Highway

Chris Lamour, Chief Marketing Officer at Actix which provides solutions to help operators optimise network performance, looks at the challenges facing network operators as mobile broadband usage increases rapidly

Late last year, Apple was slammed after complaints about a TV advert that was seen to inaccurately represent the speed of Internet browsing capability on the iPhone. The Advertising Standards Authority (ASA) said the ad “was likely to lead viewers to believe that the device would operate at near the speeds shown in the advertisement” and told Apple that the ad must not be run again.
Although the ad in question was withdrawn, the underlying network condition that causes this to be true cannot be resolved so easily. The fact is that iPhone web browsing will only ever be as fast as the network the device is connected to, making it the performance of the actual radio network that determines the service level delivered in a given location. How this service is delivered affects performance when downloading massively; there is always a trade-off between coverage, capacity and quality - more capacity can impact coverage and vice versa. 
This leaves Apple - which has staked its reputation on delivering an exceptional user experience - at the mercy of the mobile network provider to ensure the quality of mobile surfing. Apple’s brand is therefore under threat of being tarnished by a reliance on networks that do not provide good connectivity. And although it may be the fault of the network, users will typically start venting their frustration at the nearest piece of equipment, the phone itself.
Every mobile network has a different way of providing service to a specific location, depending on a wide range of factors, and each network inevitably has differing levels of quality and capacity. The best networks have more effective techniques to provide good quality, coverage and capacity, typically using smart, automated algorithms to solve tricky physics problems.
But the capacity issue can only get worse as increasing numbers of iPhone users and those of similar devices continue to drive gigabyte-level data loads. The end result is that the average performance will degrade for all users, because the radio network has a fixed bandwidth, and there is already not enough capacity to go around.
The last 12 months we have seen mobile data usage skyrocket: 10 times more data is being used on mobile broadband networks today compared with a year ago. Average users are substituting their fixed DSL lines with cheap USB dongles and flat rate services, downloading 5 - 10GB per month. Some operators saw a 40% increase in data traffic just one week after introducing this kind of flat rate offer.
But while the number of users and the volumes of traffic continue to head skyward, mobile networks are being put under intense performance and financial pressure. Operators are seeing the divergence of revenue and traffic load curves for the first time, meaning they are carry more traffic for less money. This means networks urgently need to find ways of controlling traffic, and ultimately, to find lower cost ways of delivering service.
Without investment in fixing current issues, by upgrading existing capabilities or deploying new networks like LTE, this situation will lead to roadblocks on the mobile data highway. This is something that could stall the uptake of mobile broadband data, by creating the same kind of customer dissatisfaction that we have seen in the fixed broadband world in recent years.  
In the short term, operators will need to limit traffic while they make plans to deploy more capacity, hitting the consumer with more stringent terms, and possibly higher fees for mobile data. We are already seeing this happen with the introduction of so-called ‘fair use’ policies in all-you-can-eat packages. But the genie is out of the bottle; a vast new mobile broadband business opportunity has finally been unlocked, and many mobile operators will be reluctant to put the brakes on something that opens to the door to lucrative new streams of revenue like mobile gaming, shopping and advertising.
An exciting time, and one that will also be hugely challenging for network CTOs.

A New Era Dawns

We know some of you will be missing your daily fix of mobile marketing news, even at this time of year, so here to keep you going are some predictions for 2009 from Paran Johar, Chief Marketing Officer at JumpTap, who predicts that 2009 will be the year of mobile search and advertising

Wasn’t 2004, or 2006 or was that 2008 the year mobile advertising arrived? If there is one thing I know for sure, it’s that trying to predict what year, month, day, or hour will be the shining moment of mobile search and advertising is as useless as guessing when my stock portfolio will rebound. No one knows for sure. The key is not in predicting a specific moment in time that will be a tipping point for the medium; it’s about defining the key milestones we need to achieve to acknowledge enough significant growth that says that mobile search and advertising is already here, and a force to be reckoned with. And yes, I did say “growth”. I know what you’re thinking:  “Growth in 2009, in this economy?” I must be drinking too much eggnog. But smart marketers won’t stop marketing in a down economy; they will just hold their agencies more accountable. They will seek higher responses rates from campaigns and better returns on their marketing spend. And this is where mobile shines.  But before we get into 2009, let’s review 2008 and some of the key achievements that set us up for 2009.

1. The launch of mobile @plan – this was a relatively quiet announcement, but instrumental in getting more digital media planners the tools necessary to plan and buy mobile advertising.

2. MMA establishes creative standards – not having to redo creative in multiple formats is key for marketers and agencies if they are going to test a new medium. A client is more likely to test mobile if they know they don’t have to spend 50% of their non-working dollars resizing existing creative to appease different carriers and publishers.

3. Publicis, IPG, Omnicom, and WPP all launched mobile divisions or agencies under their umbrella. The fact that these holding companies are putting their money where their mouth is and investing in PhoneValley, Ansible, iPsch, and Kinetic is a clear statement that they take mobile seriously.

4. Former Vodaphone CEO Arun Sarin’s warning at MWC in Barcelona that the operators must not allow themselves to become bitpipes and let somebody else do the services work. As more and more operators realize the potential for mobile search and advertising, they are realizing that  partnering with a Google, Yahoo! or Microsoft isn’t in their long term interest. Carriers are starting to understand the need to reinvent themselves as ‘media centric’ organizations and partner with partners that enable them (like JumpTap, my one plug) to help them with this evolution. Whoever has access to the rich customer data created from keywords, search history and other sources, like location and demographic data, will create a strong foot hold in the mobile advertising ecosystem. 

Here are my bets for 2009.

1. As we fix the front end of the media planning process, we also need to address the back end side of metrics and measurement. We will see almost all the mobile ad networks/providers integrated into Internet third-party tracking tools such as Doubleclick and Atlas. It will be a mobile media plan must-have in order for publishers to participate.

2. Efficiency in planning and buying will be a dominant theme. Self-service mobile ad systems that are fully integrated, and the process to test, buy, and optimize more easily will become more pervasive. Combined keyword search and display networks will showcase how you can leverage each other for greater targeting and relevancy.

3. We’ll see a higher level of creative standards as we see more and more “semi- rich” media ad units being tested in the market. In 2008 Internet rich media provider Pointroll was one of the first to release its expanding ad unit on the iPhone. I’m guessing we are going to see many of the Internet players expand their product lines into the mobile Internet. These rich media units will be critical, as creative agencies begin to concept more and more integrated ideas with mobile at the centre.

4. Agency talent will continue to enter into the mobile ecosystem. As more and more ad/media/digital agency talent realizes the power of mobile to connect brands to the audiences they are trying to reach, they will share best practices and work closely with technology companies to deliver on what advertisers and brands are looking for. They will speed education to all parties involved. Agencies will also to continue to expand their mobile offerings. In an effort to diversify their revenue and create unique points of differentiation, more and more agencies will move spend into mobile and showcase their results. 

5. Targeting technology will be critical as advertisers/agencies realize that relevance is the key to success in mobile advertising. Because of the uncluttered environment and personal nature of mobile, consumers will ignore generic advertising and engage only with mobile ads that are relevant to their interests. Targeting technology that integrates information from multiple sources, including carrier data, as well as search, behaviour, and contextual information will be instrumental in developing audience and monetizing audience channels. This is the winning proposition, as the user has a great mobile experience, the advertiser reaches a more targeted audience, and the publisher receives a higher CPM.

6. Wireless carriers will work together and step up to create a sustainable role in mobile advertising. They will make innovative moves to reinvent themselves as media-centric organizations and partner with likeminded vendors whose interests are aligned with their own to help them with this evolution.

7. Mobile search will take centre stage. As Internet search evolved to all-encompassing desktop search tools, so will mobile search evolve. The mobile user experience becomes more fluid and integrated between hardware, software and mobile applications, and search will evolve into a ubiquitous format, to a ‘phone-top search”. This will further blur the line between on-deck/off-deck, mobile content and applications. The beauty of this will be the development of infinitely more creative ways to not only target, but also to engage with users at the appropriate time and place. Operators worldwide are recognizing this phenomenon and are looking for partners who can integrate both the search and advertising experience to help them enhance the user experience and monetize the assets.

8. We will see the ‘Walmart Effect’ on mobile advertising, as the giant retailer seeks to bring affordable Smartphones to the masses, so will follow a cultural shift towards mass usage of the mobile Internet.

9. Direct response advertisers will learn the ease of click-to-call. Some marketers will begin to try and abuse it. The industry will begin to self regulate to avoid outside intervention.

2009 will certainly be challenging, but new companies and profits are always born in down economies. Those who focus on quality and giving consumers what they want will thrive, while  those who simply focus on mediocrity and money will not. We are at the dawn of a new era, and mobile is driving this transformative cultural change that will forever change marketing as we know it. Those who join in early will thrive and prosper.

A Question of Trust

Marcus Ramark, CEO of 123play.com, argues that ad-funded games providers must
focus on building consumer trust if they want to enjoy sustained success

A year or so ago,there were plenty of people who thought the idea of advertising-funded mobile content would never really work. The mobile content industry had settled into a convenient pattern, here developers and publishers were simply providers to mobile operators; it was the perators who controlled any and all access to consumers. Easier to leave it with the party that already knew its audience, and which was trusted and trustworthy.
Except that a year is a long time, especially in the mobile content world. Operators have now shifted their focus from games and video to music and the mobile web, meaning that not only are there opportunities to sell direct to consumers, but if the market is to continue to grow, alternate retail models must be encouraged to thrive. Ad-funded games and music have seen strong uptake, and for advertisers, it’s proving to be a valuable channel to reach engaged consumers. The growth of ad-funded is one of several reasons why off-portal sales (i.e. non-operator downloads) is projected to overtake on-portal sales by the end of this year. It’s been a while since the furore over Crazy Frog, but if off-portal is going to thrive, companies will need to put building trust at the centre of everything they do.

Easier said than done
And for some, that’s easier said than done. Creating services that consumers can trust requires time, effort and vigilance. So while some companies have succeeded, many are still failing. Consumer group Which? recently stated that a majority of advertised off-portal services breach many of the rules governing download services, and provide a very poor experience for users.
For any mobile service to succeed, the overall experience needs to be perfect, or as close to perfect, as you can get. Even more so for ad-funded content: it’s more likely that consumers trying an ad-funded service will be downloading content for the very first time. In my experience, there are a handful of factors that are key to building a successful and trustworthy service:

1) Quality - Any service in any industry relies on the quality of its product. Services which appear to offer something cheaper, but with less quality control, may seem like a more appealing option initially, but inevitably, there is always a downside. Quality content is essential to attract consumers and compete with the carrier decks. Providing high-quality, popular games for a variety of audiences means consumers are more likely to re-use the service on offer to them. With advancements being made in the handset world, mobile phones are more capable than ever in providing consumers with a better service. The games on offer need to reflect this.

2) Quality advertisers - Using advertisers that are of interest to the user means that you are giving the consumer exactly what they want. Working with the right advertisers allows a service provider to deliver tailored and relevant key advertising to its audience. In a world where its easy to filter adverts through advanced TV systems, and you have iTunes competing with the radio, advertising needs to be smarter, and directed to its target audience, and not just in a blanket fashion.

3) Minimise poor experiences in the service - Providers need to work towards keeping an excellent end-user experience front of mind. Choosing an ad-funded mobile game means the consumer is accepting the whole package, from the time it takes to download the game, to the quality on their mobile phone. Each step needs to be 100% right, and if it isn’t, then the overall quality of the service will be diminished. 

4) Enough downloads, volume and users to get quality advertisers on board - Success in ad-funded mobile gaming includes getting a wide-distribution audience. Affiliate deals with key publishing houses and websites give access to key consumer audiences, emphasising free mobile games, with targeted, quality advertising from top brands. With an established consumer base already in place, users trust the publishers and their recommendations to provide a service of high quality, right from the outset.  

5) Build trust among users by keeping the service quality high and avoiding negative impacts such as hidden costs, spamming etc - Once an audience has been generated, it is important not to let that level of service diminish.  By working only with top brands and games providers, companies can ensure the service works perfectly for its audience. 

By following these steps, providers can aim to supply top quality games for their user-base, and provide advertisers with a wide-ranging user-base for their services, whilst maintaining high standards for the consumer - in short, everyone wins.

Top 5 Phones of the Year

We don’t get too involved with mobile handsets here at Mobile Marketing Magazine. We figure there are enough sites out there reviewing hardware without us getting involved. But when review site Testfreaks offered us their take on the Top 5 phones of 2008, we thought, why not. So here’s Testfreak’s Kristofer Brozio with his take on the best 5 phones of 2008

The aim of TestFreaks is to aggregate product reviews from other sites, in order to average them out to provide a score that a user can understand when trying to find more information about a product. We also collect user reviews as well, so the average consumer can see and learn what people just like him or her have to say about a product. Whatever the product category then, we see a lot of kit and a lot iof reviews. So here’s our take on the Top 5 phones of 2008…

Location, Location, Location

Alistair Goodman, CEO of 1020 Placecast, which targets consumers using location-based information across the web, mobile, wi-fi networks and email, offers a list of six interactive advertising trends to watch in 2009 

2008 marked a turning point in online advertising. Despite the slowing of growth in overall advertising spending, online finally achieved its place at the table in mainstream media plans and continues to prove its value relative to traditional media. It was also a year for increased public scrutiny of industry practices as the medium achieves scale and prominence with advertisers.
The year ahead will be difficult in many respects, but also very exciting. We expect that marketers who need to do more with less will put pressure on agencies, media providers, publishers and measurement firms to deliver more value. At the same time, tough market conditions always produce new ways of solving old problems. We see big opportunities for advertisers to find new ways to drive better performance for their campaigns.
The six key trends we feel will be prevalent in 2009 are:

1. The value of user data is questionable
2009 will mark the year that advertisers begin to look for alternatives to collecting and mining user data to improve the performance of campaigns. For several years, online marketers have attempted to incorporate increasingly large amounts of user data into the marketing equation with the goal of improving targeting and performance. Unfortunately, the company says, advertiser reviews of this approach are almost universal: "anticipointed."
We now find ourselves in wave 2.0 of this effort in which firms are undertaking predictive modeling, attempting to analyze even more data in order to predict behaviours. However, these efforts will continue to disappoint and 2009 will mark the year advertisers begin to look for and incorporate new, non-user data sources for improving the performance of campaigns.

The Perfect View

Dr. Kathleen Brush, Chief Marketing Officer at Openwave, argues that mobile operators are in an ideal position to achieve the much-vaunted 360-degree view of their customers

The value of a 360-degree consumer view to the marketer is indisputable. Like every Chief Marketing Officer (CMO), I have dreamt about being able to craft campaigns based on specific target buyer characteristics. Instead of spending millions on expensive campaign materials that reach disinterested parties and then relentlessly pursuing unqualified buyers, the recurring marketer’s dream is for a marketing campaign to cost-effectively reach buyers that are pre-qualified and interested in buying your products.
Recently, I was part of a discussion suggesting that this 360-degree view was within reach. I was naturally sceptical, knowing that over the years I have investigated, marketed and used many products promising this unabridged view, but none so far had delivered more than 60 degrees.

Signs of Success

Yvonne Li from US mobile marketing company Mobi33, which operates a multichannel mobile content management and distribution platform, discusses the implications of, and the opportunities presented by, the convergence of digital signage and mobile marketing

Over the past year, a tremendous amount of buzz has been generated by the convergence of digital signage and mobile marketing. Advertising agencies and ad networks want to know what convergence means for the future of their enterprises. This article will clear up some of the myths surrounding the buzz and show you how to prepare for the future of digital signage.
Mobile technology will soon be at the centre of all cross-media advertising convergence. Look at the numbers and you'll understand why mobile is already on everyone's mind: The number of mobile subscribers worldwide rose from 11 million in 1990 to 2.6 billion this year; that number is projected to rise to 4 billion by 2010. And almost all mobile phones are capable of receiving ad content in one form or another.
Before you decide on a mobile strategy, you should understand two things: how mobile marketing works to your benefit, and how to determine the optimal configuration for your digital signage network.
If you're familiar with mobile marketing, you probably know that it's next to impossible for mobile carriers to push your ads directly to their subscribers. Meanwhile, the mobile Internet is still in its infancy compared to online advertising. As a result, mobile ad content still relies on other forms of media in order to be distributed. But here's the key: As soon as mobile content takes up residence in a mobile phone, it produces a long-lasting effect.

The Future of Mobile, According to Airwide

Chris Lennartz, VP of Product Marketing at Airwide Solutions, offers his predictions for the mobile business in 2009

A wise man once said that “predicting the future is the art of seeing the present logically extended”. As December draws in and the end of 2008 approaches, it’s time again to be thinking about what the New Year will bring. There’s no doubt that for many, things are going to be tough in 2009, especially given the difficult economic crisis we find ourselves in. However, for the mobile messaging industry, things may not be quite so bad. Here are my top predictions for 2009….

1. Mobile messaging to defy the economic downturn
Mobile messaging will continue to grow, despite the current downturn in the global economy. As mobile data revenues increase, and voice revenues are under pressure, mobile messaging will be seen as the lifeline to the mobile industry, especially as mobile youth regards it as cheap, fast, private, easy and silent. It will fuel the growth in mobile data services, and will in turn steer mobile operators, device OEMs and content providers through the tricky times ahead. Our predictions support recent figures from M:Metrics,  which state that the number of people using SMS has increased 3.3% year-on-year across mature markets like the UK, Germany, France, Italy and Spain. This supports recent figures from ABI research, which state that revenues from mobile messaging will grow from $127 billion (£86 billion) in 2008, to $212 billion by 2013. Whilst these figures are good news for the industry, they also underline the need to ensure that an operator’s underlying infrastructure is efficient, and equipped to support the increase in traffic volumes over the years ahead.

The iPhone - an Operator's Worst Friend?

John Strand, CEO of Strand Consult, argues that some network operators have been seduced by the allure of the iPhone, to the detriment of the majority of their customers

A lot has been said and written about the iPhone, and there will undoubtedly be more to come next year. There is no doubt that Apple's PR department has created a unique PR campaign, around a product that is seemingly beautiful on the outside. But what is actually inside, and how good is the iPhone for operators that partner with Apple?
Strand Consult is not in the business of creating hype around technology; our business is to explain to mobile operators how the future market will evolve and how to make money for their shareholders. So what do we make of the iPhone?
Well, in the same way that Apple primarily handles the interests of its shareholders, we believe a number of operators ought to focus a little less on the iPhone and a little more on their shareholders.

Voice of Reason

Duncan Parry, co-founder of search-inspired communications agency Steak, considers the implications of Yahoo! and Google's launches of voice-enabled mobile search services

Only last year, Google and Yahoo released voice-recognition 411 services, which enabled phone users in the US to get free directory results for local services. Now, both engines have integrated the same technology into applications for mobile phones.  Google’s voice search application is available on the iPhone, while selected BlackBerry and Nokia phone users in the UK can now take advantage of voice-activated oneSearch from Yahoo!   
Both applications allow users to say their mobile internet search - “Thai restaurant” for example - instead of struggling with the keypad on their phone. Clearly, voice-enabled applications have their limitations - “Thai restaurant” becomes “fine restaurant” and “Covent Garden” returns “handguns” - but when they work and a location is found, relevant results include a mix of web, local and map information.   Ideal for finding a number for the restaurant you’re heading to and details on where it is.

Value-add experience
Although both the technology and Internet speeds of today’s mobile devices are on a par with desktop PCs of a few years ago, the success of any mobile application will be based on whether it provides a value-add experience for the person using it. Whilst both Google and Yahoo! are relying on the same set of search results that would be served up for PC users, the mobile Internet experience is dramatically different, both in terms of the possibilities it affords and the way consumers are embracing it. 
What mobile handsets lack because of their small screen sizes and minimal keypads, they make up for in GPS-enabled localisation, the increasingly high speed of mobile Internet access, and push data access. This is especially true for the iPhone, which has heavy mobile Internet usage – 80% of all iPhone users compared to just 32% of Smartphone owners –which has generated enormous revenue for Apple from downloadable applications.
These two trends alone show that there are many opportunities for brands to get involved in mobile, which has long been touted as the next big thing for advertisers.  Google’s Android platform supports an applications store similar to the Apple AppStore and both companies have made it easy for anyone to create innovative applications to extend their brand, generate income and make the most of existing userbases.   

Different requirements
By making voice-enabled, consumer-focused mobile applications available, Google and Yahoo! are acknowledging that the mobile platform has fundamentally different usability requirements to the traditional, static computer. Brands should recognise these differences too. Mobile strategies need to be carefully considered to take into account, not only the different attributes of the mobile platform, but also, the ways in which it is being used. Squeezing a normal website onto a mobile site just doesn’t cut it anymore; they need to delivered in WAP format and in a way that optimises all forms of mobile marketing.
Let’s tip our hats to Apple here too: the iPhone, just like the iPod before it, has pushed manufacturers and advertisers to up their game by providing consumers with a must-have, easy-to-use product that provides value-add experiences. Even with a higher percentage of iPhone owners accessing the Internet, adoption of voice-enabled search will be slow. For the moment, Google and Yahoo!’s applications will only appeal to early adopters, but they are a wake-up call for brands to get their mobile marketing ducks in a row.

Smart Support for Smartphones

David Ginsburg, Vice President of Marketing and Product Management at InnoPath Software, argues that operators could help themselves by changing the way they handle customer queries and complaints related to Smartphones

What if you threw a party, and no one came? Some wireless operators must feel this way. They spend millions on developing and marketing new services with the hope of generating subscriber stickiness, and the accompanying revenues. However, many times, despite their best intentions, the service fails or is only moderately successful.  Why is this? Why do Smartphone subscribers make use of only 25% of the applications on their devices? And why, when some services are launched, do less than 5% of the subscribers successfully ‘pass go’ when over 50% try to download the application? Does the problem lie with the operator, the phone manufacturer, the subscriber, or all three?

Is it a phone, or a computer?
Smartphones are really small computers in disguise, but there seems to be an expectation that they should be simple to use, right out of the box. Except for a few, well publicized models such as the iPhone, this isn’t usually the case. Application settings are sometimes quite complex, and when something goes wrong, who do you call? 
In the rush to get the latest and greatest models into the hands of the customers, phones are shipped with bugs impacting usability. Recent problems with this season’s ‘must-have’, the touchscreen, only compound concerns among subscribers. Do they make the leap to the latest and greatest, back off to a simpler, less capable model, or hold off on their purchase altogether? How can operators stem the tide of user dissatisfaction?
In a hyper-competitive environment, operators look to high-ARPU data users to balance declining voice revenues. They target these users with the latest Smartphones, oftentimes at a high subsidy. They craft their latest service offerings with these users in mind. But there is a dark side. Smartphones cost more, sometimes much more, to support. At four times the lifetime costs of more basic featurephones, a single half-hour support call for broken email or browser settings can eliminate any profit they hoped to gain from the subscriber. At the same time, operators are under pressure to reduce their operational expenses. In light of the current economic environment, where ARPU gains fade into the distance, they need to hold on to the subscribers they have. This is sometimes at odds with the need to reduce support costs, with any drop in customer satisfaction accompanied by a rise in churn. So is there a way out?

What if?
What if, when a customer called in with a problem, the care representative could reach out and touch the device, checking it for any problems while the user was still on the phone? They’d check the phone’s application settings, correcting anything that looked wrong. What if they could easily push updates to the phone over-the-air, addressing those touchscreen problems mentioned earlier? What if they had a simple and error-free way of configuring the phones at the point of purchase, avoiding later frustration?  And, what if, when a user did call in with a problem, they had the tools at their disposal to help with usability questions?
Today, over 30% of all calls are related to configuration, and 25% of all issues are never resolved in a whole year. In any other industry, this would be a failing grade.  Just think if 25% of new cars were in the shop constantly. Maybe we need a lemon law for mobile phones.
Mobile Device Management (MDM), a technology offering the operator a way to touch the phone over-the-air, is the solution. No longer running blind, frontline customer care representatives now have a direct channel to the device, with an ability to check on software, hardware and application settings. They can even check to see if Bluetooth settings are mis-configured. Through this visibility, they can be much more efficient when working a user through in issue. In fact, MDM can save operators billions of dollars annually in reduced call expenses by shaving just a few minutes off off every call. They can immediately tell if a phone needs an update, pushing it out, and either addressing known issues or enabling the user to benefit from new applications. The positive impact on first-time problem resolution and customer satisfaction goes without saying.
MDM, by offering operators an effective way to address bugs, configuration errors, and usability issues, also impacts service rollout, by creating confidence that errors can be addressed, even if the phone is in the hands of the user. It enables operators to  market new, high margin services more aggressively, safe in the knowledge that if changes need to be made, they can push out updates. And, they can even update phones already in the hands of subscribers to be able to take advantage of these new services, thereby expanding their addressable market. MDM may very well be the tool that turns the tide of service adoption and customer satisfaction.

Mobilising the Publishing Industry

Jeremy Copp, CEO of Rapid Mobile Media, argues that’s it’s time for the publishing industry to start monetising their content, which is perfectly suited for mobile consumption

Newspaper and magazine publishers were some of the pioneers in delivering content to consumers on the web. Yet curiously, those who were earliest and most innovative on the web are the last to make the move to delivering and monetising through mobile services.
The news and entertainment content produced by the publishers is ideal for mobile consumption: much of it is time critical and most fits the ‘snacking’ usage scenario of consumption on phones – users tend to fill time interacting in short bursts (whether creating or consuming content) in periods where they otherwise have nothing else to do. Delivery of services to mobile phones therefore represents an ideal medium for publishers to reach consumers when they do not have access to the web through a fixed terminal – their phone is a highly personal device that is with them at all times of the day (and sometimes night)!
The keys to enabling such services lie firstly in making it easy for the publishers to deliver to the complex mobile environment, and secondly in providing efficient monetisation mechanisms to fund the services through advertising.

Diverse landscape
The mobile phone landscape is an incredibly diverse one, with many thousands of handset variants to be supported, compared to perhaps three or four browser environments for web service delivery. Publishers should not have to be concerned with such complexity, but rather, they should be able to focus on their core business of delivering great content. Solutions exist that will automatically optimise the presentation of content and services for all handsets, ensuring not only that the end user has the best possible experience (and therefore will be more likely to use the service) but also that the publisher need not be concerned with the delivery and presentation aspects of the content, only with the quality of features and editorial.
These delivery platforms open the possibility, not only of providing rich mobile Internet experiences, but also, of deploying applications to handsets to enable richer interaction experiences through games and puzzles, transactional services such as sports betting, classified advertisements for jobs, homes and cars, and even the mobilisation of dating services.
Most of the publishing industry has extensive experience of selling advertising space within their properties - both online and off - so display advertising is an obvious revenue generation mechanism for mobile services. It could be argued that it is the media owners that have driven the advertising industry for existing media channels (print, radio, TV and online) and that they will do the same in mobile: the infrastructure already exists within their organisations to sell and manage advertising delivery within their own inventory.
Crucial to the successful monetisation of the mobile services is the ability to manage the delivery of high quality, relevant and unobtrusive yet unmissable advertising. Advertisers must be assured that their branding and messages are presented at the highest possible quality, which if achieved, will generate premium impression rates for the publisher; the user must feel the advertising is adding to their content consumption experience. He or she will demand relevance, unobtrusive presentation and an easy interaction mechanism. The mobile advertising delivery platform must also fit with the publisher’s existing advertising sales workflow, whilst automatically managing the delivery into their mobile properties across all of the diverse device types.
Just as for mobile service delivery, so the publisher must be freed to concentrate on the business of planning, selling and reporting ad impressions, without having the complexity of considering how to reach every phone type (and not having to have multiple versions of the ad creative to do so), which is necessary to avoid artificial segmentation of the target audience based on phone model.

Ideal position
The publishing industry is in an ideal position to engage consumers through their mobile phones, interacting with them all through the day, not just when they have the opportunity to sit in front of a PC or read a newspaper or magazine. Furthermore, they have content that matches the typical usage models of mobile; the marketing channels through their existing properties to drive a significant volume of users to their mobile service; and the existing advertising sales infrastructure to be able to derive revenue by delivering impressions to the mobile audience.
Perhaps the move to mobile to date has been slowed by the technical complexity of delivery, but platforms do now exist to ensure that compelling, easy to use content and services can be broadly deployed and monetised through high quality display advertising. Publishers should not be afraid to use them.

Text is More

Peter Tanner, Managing Director of the Text Messaging Centre, sings the praises of the humble text

What is the business cost today of inefficient communication? From the over-reliance on ubiquitous email that all too often gets overlooked in a crowded inbox, to expensive mobile phone calls and, in the case of customers, posted appointment letters that often remain unopened. Despite a massive investment, organisations are still failing to achieve effective real time and cost effective communication.
And while the mobile email facility has been hyped, especially following the iPhone launch, in reality, only a small percentage of employees, customers and partners can access email via the mobile phone. As a result, urgent communications require an expensive mobile call - risking interrupting the recipient mid-meeting or, in the case of field engineers, possibly in the middle of a complex repair job.
The ‘always available’ economy is, in reality, anything but. Organisations are missing business opportunities and jeopardising customer relationships because critical, time-sensitive information is consistently overlooked as individuals endure the email deluge and miss essential telephone calls.

Intelligent Bitpipe Anyone?

John Strand, CEO of Strand Consult, a consultancy firm that specializes in the mobile sector, looks at the logical consequences of mobile operators’ increasing trend towards outsourcing non-core operations

Down the years, there have been many discussions about what the mobile operators’ core business should be and what a ‘real’ mobile operator should look like.
Somewhat simplified, one could say that mobile operators purchased technology, services etc., packaged them up, marketed them and sold them to their customers. If you were to compare a traditional mobile operator to a supermarket, it would correspond to a supermarket owning their own dairies, butcheries and wine castles!
The number of operators that are handing larger or smaller parts of their business to various sub-contractors is, however, increasing, and we are seeing more operators choosing to discontinue handling the daily operation and servicing of their own networks and leaving these tasks to players like Ericsson, Alcatel Lucent, Nokia Siemens Networks, etc.
One question that springs to mind is whether in the future, we will see some operators that consider themselves to be intelligent bitpipes, where their core business is limited to a mobile licence and a billing system, and all other functions are handled by various sub-contractors or partners that only have one goal - to create as much traffic as possible on the operator’s billing system.

Quality control
An intelligent bitpipe operator will need to focus on three critical areas. Firstly, quality control of the services being outsourced, including network and partner production, and the end user customer service given by the partners. Secondly, the development of new business models, making it attractive to create traffic in the operator's network and on its billing system - this should be good business for all parties; having many strong partners will strengthen the operator. And thirdly, having a strong business intelligence unit that monitors the market and sees how the operator’s partners’ services and products fit into the market, while simultaneously searching for new partners that can create traffic in the operator's network.
In other words, the dream of the intelligent bitpipe is that of creating a ‘dream team’ of people that, via a number of partnership agreements, can cover a whole market. The partnership agreements will in practice mean that the operator has a minimal CAPEX and that their costs will mostly relate to the cash flow being generated on the mobile network.
We have no doubt that we will see operators using this strategy. The question is, how far each individual operator will go, and whether they will be consequent in all areas and shave their business down to a minimum, or whether they will continue to have business areas where they purchase, manufacture, market and sell various services themselves.

Realising the Digital Opportunity

Colin White, UK CEO of mobile solutions company Oxygen8 Communications, highlights the potential for incrementally increasing revenue, without incurring major business risk, by creating a single, consistent offer across all channels

The media market is in transition. Increasing audience fragmentation and declining advertising revenues from traditional media are creating increasing pressure on media companies. Whilst there has been an explosion in demand for digital media, especially video and IPTV, as yet, few companies understand this shift in consumer behaviour, nor are they attaining the expected financial rewards.
In a bid to maximise new media, too many companies are pitting their own traditional print, radio and TV products against associated websites, cannibalising both audience and revenue as a result. The lack of strategic thinking, combined with inept processes, further jeopardises the long term revenue stream.
This digital marketplace is undoubtedly the future. Media companies need to become attuned to selling new media advertising, from mobile to IPTV, in a way that complements, not undermines, traditional products, and reflects the expectations of the consumer.
This shift in approach requires not only an investment in technology, resources and understanding, but also a significant corporate restructuring to deliver an integrated cross-media strategy that maximises average revenue per user (ARPU).
Few organisations, however, are willing to make such changes in the face of the economic downturn or, to be frank, following the significant dent in revenues that resulted from the problems with premium rate IVR and SMS services last year.
This latter point should be a major wake-up call. Organisations have got to get to grips with new consumer behaviour, their likes and dislikes, if any new media strategy is to successfully replace declining revenues elsewhere.

Game On

Mark Denton, Director of Product Management at Valista, argues that in-game pricing is the way to go for mobile games

The world of gaming is changing. Competition for retail space, the ability to play online, and the fact that players are demanding frequent updates to games in order to maintain their attention, are changing the way games are marketed and sold. There are a number of options which are being examined by games vendors. These range from standard subscription models to ‘freemium’ models, with customers paying within the game as they play. All these models rely on the ability, and desire, of the player to make small, low value payments rather than the traditional large value, one off payment of £39.99 or so.
The best way to understand this growing trend is to use an example. A game producer creates a new adventure game where players roam a virtual world, earning points which entitle them to alternative clothing, weapons, food, tools, pets, etc. Once they have a large number of these add-on items they can journey to the next level of the game where the process repeats.
Rather than being sold in a box on a shelf in a retail store, the game is made available online with a monthly subscription fee of £2.99 to pay for playing the game, and with the first month provided for free. While playing the game, the player can accumulate points which are used to pay for items within the game. But the game producer may choose to allow players to top-up their points to a certain level using a payment of £0.01 per point purchased. Alternatively, the game producer may introduce a new weapon that will be available one month early to players who are willing to pay an extra £1.00 for early access. Both these models allow players faster access to items within the game, in exchange for additional revenue for the game producer.

Mobile's Big Moment: Election 2008

Following Barack Obama’s stunning US Election victory, in which mobile played no small part, Airwide Solutions Vice President of Product Marketing, Chris Lennartz, offers advice on what marketers can learn from his campaign

On many levels, the 2008 Election has been a groundbreaking moment in US history. Certainly, in terms of campaigning, it has been anything but conventional. Much of that credit must be given to wireless technology - specifically mobile messaging. While grassroots campaign efforts certainly got their start four years ago with Howard Dean’s ability to raise unprecedented donations on the web, technology’s impact on the 2008 Election will undoubtedly be remembered, in large part, for the role mobile played in getting out the vote, transforming group messaging and setting new standards for SMS use by everyday citizens and political figures.
For example, at $1.26 (£0.80) per voter, mobile campaigning has proven a more cost sensitive, yet highly effective, alternative to traditional campaigning methods, such as automated calls and door-to-door canvassing (which cost around $20-$30 per voter). In fact, a study by researchers from Princeton and Michigan Universities, together with the US Student Public Interest Research Group (PIRG) New Voter Project Mobile Voter and Working Assets found that text message reminders to new voters increased an individual’s likelihood of voting by close to 5 percentage points. This is an increase similar to ‘quality phone call’ reminders. but at a fraction of the cost.
And of course, Presdient-elect Obama used mobile with a vengeance, developing a mobile page that allowed US citizens to download ringtones and wallpaper, sign up for Twitter feeds and receive text alerts about policy and campaign events. He even registered 62262, which spells ‘Obama’ as a shortcode.
So what can brands learn from the lessons of the 2008 Election? Here are my top five takeaways for mobile marketers looking to  generate the same kind of success in their 2009 mobile marketing campaigns:

1.    The power of the message lies beyond 160 characters: One of the best tactics of savvy political campaign managers has been the use of embedded links in each message that direct to a candidate’s homepage. Marketers should consider doing the same by directing consumers to their brand’s web site where they can access product information, promotions, sign-up to receive other types of mobile content and alerts or even make purchases.

2.    Tap into MMS: MMS carries huge potential for political campaigns with the dissemination of video and photos of political rallies and speeches. As more video enabled handsets come to market, brands should consider tapping into MMS to link consumers to their products more interactively, creating even stronger one-to-one connections with customers.

3.    Demographic targeting: Operators are now able to tap into more demographic information than ever before. Political campaigns have utilized these features to target voters in particular cities, regions or with specific issues in mind. Marketers can and should do the same. With location-based services becoming more commonplace on phones, the ability to deliver targeted messages will be one of the biggest enhancements to mobile messaging in the near future.

4.    Real time voting and polling: Throughout the campaign, many news organizations have offered viewers live polling numbers based on call-to-action campaigns issued on-air. Operators’ ability to handle massive spikes in traffic around these messaging campaigns is better than ever before, and marketers should take advantage of real-time polling and voting to gauge consumer sentiment in connection with other parts of its advertising campaign (e.g. the launch of a new Superbowl commercial, perhaps).

5.    Offer premium content and mobile-only promotions: By offering voters a sneak peak at the VP pick, or VIP access to a candidate’s event, campaigns have been able to gather a huge following, much of which is highly involved in grass roots campaigning (in marketer speak, helping to build the candidate’s brand). In the same way, marketers can inspire real action among potential customers and cultivate a more loyal base.

Let’s Make It Personal

Rob Dalgety, Communications Director at Mobile Device Management company Mformation, argues that personalisation will stimulate demand for mobile services

As markets mature, new techniques are needed to stimulate usage and revenue. Segmentation is a well-understood marketing technique. Most markets are not homogenous; customer segmentation is the practice of dividing a market into groups of individuals that are similar in specific ways, such as age, gender, interests, spending habits, wants or attitudes. Value is created when products and services are targeted appropriately into these segments.
In the mobile marketplace, there is now a need to be more targeted, adding customer insight to the mix and more flexibly delivering services that meet the needs of specific customer segments, thereby driving higher mobile usage. The mobile market has seen a huge amount of innovation over the last 20 years; it will need to keep innovating to ensure that end users continue to do more with their mobile devices

Kick Starting the Mobile Advertising Industry

At last, a common-sense approach to mobile advertising. Jeremy Copp, CEO of Rapid Mobile Media, offers a five-step plan to turn mobile advertising's potential into something more tangible 

The mobile advertising market is set to be a huge global industry – most projections agree that it will be worth more than $10 billion in two to four years time. However, in common with many nascent markets, there are challenges in building initial traction – it has become a running joke that every past couple of years has been the “year of mobile advertising”, and this and next year are looking like they will carry the same label. The challenges arise from trying to introduce a diverse, growing and substantial new advertising channel to an established industry which already has significant high volume business delivering into print, TV, radio and online.
In order to successfully introduce the mobile advertising channel and stimulate its initial growth, some creative measures in business practice and models are necessary. Here are five suggestions for action from all parts of the value chain to improve the chances of the earliest success for all involved:

1. Make it worthwhile for the media buyers to focus attention on the mobile channel
The volume and size of mobile advertising deals available at this early stage of the market look unattractive compared to established media channels when traditional remuneration plans for the buyers are applied (typically a share in the campaign budget). The revenue available is often currently insufficient to warrant participating in the mobile space, let alone building mobile specialist practices.
The advertising agencies and brands, together with the media buyers, need to agree alternative, equitable remuneration structures that will make it viable in the short term for the media buyers to build mobile businesses.

2. Apply creative revenue and delivery models to mobile advertising campaigns, rather than simple per-impression remuneration
The volumes of mobile inventory impressions available for sale are still relatively small compared to other media. However, the targeted and contextualised nature of mobile delivery means that there is still significant value for campaigns. Sponsorship or tenancy deals that are not volume based, offer attractive alternative models for advertiser and publisher alike, and have the potential to be bundled with cross-media campaigns or other marketing initiatives.
The mobile channel also offers the potential to deliver alternative vehicles for brand-based marketing over and above simple display space in existing services, including perhaps the deployment of branded utility applications and mobile Internet destinations that allow the user to engage with the advertiser, at the same time as providing vehicles for further brand messaging through adverts.

3. Simplify the mobile message for the advertising industry
Even though the delivery of advertising to the mobile channel may be technically complex, the underlying principles are very straightforward and common to most other advertising channels. The initial message to the advertising world needs to be clear and concise, focusing on the opportunities to deliver brand messaging and the mechanisms for generating returns on that investment. The complexities of the significant additional facilities the mobile channel offers can be introduced later, once the advertising value chain is engaged, rather than acting as a barrier to entry.
A simple first step in this direction would be for the mobile marketing industry to use a common, coherent vocabulary. I am still surprised to hear both ‘WAP’ and ‘mobile Internet’ used interchangeably at mobile marketing conferences: how is the advertising world expected to understand if there is a difference? 

4. Fit in with existing advertising industry practices
The advertising and media industry has very well established workflows for campaign planning, buying and reporting, as well as inventory forecasting, sales, booking and reporting. The addition of the mobile channel to the mix should seek to minimise any changes required to these practices, so reducing any barriers to adoption.

5. Do not artificially segment the mobile advertising audience
It is counter-intuitive to the advertising world to segment the delivery of mobile advertising campaigns in a publisher’s property by network operator and/or device type. The mobile industry should be providing the capability to deliver campaigns across the broadest range of users, with the optional capability of using the network or device type as a targeting parameter, rather than as a restriction on the available set of consumers.