MOBILE REVENUES/MOBILE TV - Mobile moves on
Laura Marriott looks at the way operators are able to marry new technologies, such 
as mobile TV, with mobile marketing initiatives in order to deliver the services subscribers want, in a personalised and convenient form
There are several key stakeholder groups in the mobile marketing value chain. Each has a different set of objectives and requirements. For the advertisers it is about their ability to implement highly-targeted, measurable marketing initiatives to a wide audience. For the operators it is about rewarding customer loyalty (or preventing churn), increasing average revenue per user (ARPU) and developing service differentiation. Consumers, meanwhile, demand compelling content delivered to them in a personalised and convenient manner.
All these players will benefit from the development of a prosperous mobile advertising industry.
The opportunity is certainly a large one. According to ABI research, worldwide mobile marketing and ad spending will reach $19 billion by 2011, up from $3 billion in 2007.
For mobile operators, mobile marketing and advertising represents a relatively rare opportunity to create value from a non-subscriber revenue source. As most operators around the world still struggle to ramp-up subscriber usage of lucrative new data services, creating new revenue streams becomes ever more vital, especially as core voice revenues continue to decline due to price pressures.
There are five main types of mobile marketing content delivery: voice (e.g.: IVR), mobile internet (e.g.: WAP), messaging (e.g.: SMS/MMS), Video and television and downloadable (Java/ Brew etc.). Traditionally, the operator has used such delivery mechanisms to deliver "on-deck" content, which has required the content provider - or mobile marketer - to have a direct relationship with the operator. It was considered vital that the operator "owned" the customer and that this relationship was not compromised by third parties - other brands, advertisers, billing providers that could dilute the operator's relationship with its customer base. The downside of this model was that the operator shouldered the burden of marketing the new services, content was often limited or its potential was unrealised, and it was difficult for third-party brands to truly leverage their value.
As a consequence many of these early content-based initiatives were not compelling as far as the end-consumer was concerned and a few failed to deliver the desired uplift in operator-revenue.
Thanks to the rise of mobile marketing and advertising this model is evolving. As operators are increasingly able to generate revenue from marketing initiatives, their mobile web sites can begin to operate more like a portal than a mere storefront. This means that off-deck and on-deck content can be combined to enable access to provide the consumer with an almost unlimited range of content and services.
These emerging business models are also being shaped by new mobile technologies, most notably by the rise of mobile broadcasting. Today the mobile TV market is a small one in terms of revenue and consumer adoption, but the industry predicts strong growth. The first nationwide mobile TV services went live in the US and Europe in 2007 after years of trials and customer usage studies. Nevertheless, the technology is in its infancy as far as consumers are concerned: of the estimated 233 million handsets in the US, only around 10 million are able to access mobile TV. (Sources: m:metrics, eMarketer, Forrester, Yankee Group).
As the two industries - mobile marketing and mobile TV - are emerging, an opportunity has risen for them to compliment each other and stimulate further growth. A recent study by m:metrics commissioned by the Mobile Marketing Association (MMA), found that among US subscribers interested in mobile TV services, almost half (41 per cent) said they would watch mobile adverts in order to access mobile TV services free of charge. Another 20 per cent said they would access mobile advertising if it meant accessing services for a reduced fee.
Advertising within mobile TV environments can take many forms. As with traditional TV, advertising can occur before (pre-roll), after (post-roll) or during programming (including product integration or branded entertainment) - all formats most consumers will be familiar with. In addition, there are a number of forms of mobile-centric advertising elements that can be incorporated in the mobile programming. These include, real-time text overlays, real-time image overlay (watermark), and premium-rate SMS (PSMS) links to encourage Participation TV and avatar branding alerts.
The FIFA World Cup in Germany in 2006 proved a fertile test bed for many of these emerging business models. Mobile Dreams Factory, a specialist in delivering mobile marketing campaigns and an MMA member, was the company behind one of the most successful of these: Vodafone's "Videogoals 3D", which delivers animated, 3D videos of goals scored during the matches to mobile devices within minutes of the real-time experience.
3D models of all the teams and players were created. When a goal was scored, the play was reconstructed and animated within seven minutes of the real-time activity. The video was converted to a mobile format that was sent to Vodafone clients and to Marca.com, a leading Spanish media group, for publication on the Internet.
Videogoals 3D was the most visited of Vodafone services during the World Cup and the most visited of Marca.com's internet services, with more than nine million videos viewed. Not only did Vodafone associate its brand with football via this high-appeal, unique product, but the company was also able to promote its Vodafone Live 3G content-based service, including driving MMS revenues. The service was recognised at the MMA's annual mobile marketing awards 2006 for its ability to integrate multiple cross-media elements to communicate and deliver on the service availability.
For advertisers, the World Cup represented an opportunity to reach a huge audience but there were two main problems: traditional advertising was often prohibitively expensive for smaller companies and the event itself was so saturated with advertising that some less well-known brands could easily get lost in the noise. Mobile TV provided a solution to both problems.
CEPSA, a leading gas and oil company in Spain, worked with the Mobile Dreams Factory to create a World Cup-related real-time videoblog. The company sent two reporters to Germany to provide additional information on the activities and training sessions of the Spanish team and to share other anecdotes.
This was considered the first time that a real-time video service, utilising 3G mobile devices, captured and simultaneously transmitted a signal to thousands of users during a major event such as the World Cup. Using 3G mobile devices, the service was able to capture and simultaneously transmit a video signal via the Internet while audio files were transmitted over the operator's network. The audio and video subsequently came together in a platform in Madrid. The system recorded all the live connections so viewers could view them later as time-delayed videos.
The real-time videoblog was innovative because it involved the convergence of digital media, using the mobile device both as a communication tool and as the medium itself. By integrating 3G technology with both mobile and internet services provided the consumer with an exceptional mobile experience, while extending the brand for CEPSA and connecting it with the FIFA World Cup. The service was given the Innovation Award for Creativity in Technology at the MMA's mobile marketing awards 2006.
The success of such pioneering services during the World Cup has seen them subsequently taken up elsewhere and to similar effect. The Videogoals 3D service, for example, has since been rolled out by Telefonica´s Movistar in Spain, which successfully integrated Coca-Cola as the campaign advertiser of the service. The model is able to satisfy all members of the value chain: Coca-Cola is able to reach Movistar subscribers; Movistar is able to offer free, exclusive content that differentiates it from competitors, and the user receives exclusive, free premium-content.
The portal exhibits the corporate image of the advertiser and banners are placed in different places around the site featuring the Coca-Cola logo. These can be static or animated, and the system will automatically detect the user's device to request adapted and appropriate media.
The service saw some astonishing results. In the first three months of operation, more than 10,000 users registered for the service and around 1 million impacts on banners and downloads.
Its still early days, but such case studies demonstrate how operators are able to marry new technologies such as mobile TV with mobile marketing elements to deliver compelling services to subscribers. Hopefully, 2007 will see many more examples and lots of unique innovations.
Laura Marriot is President of the Mobile Marketing Association
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