Ovum Comment: Nokia enters mobile advertising fray

Nokia's shift from device manufacturer to a wider services company stepped up a gear yesterday when it announced two mobile advertising services: Nokia Ad Service and Advertising Connector. The first is a fully managed service that will feature an advertising network and platform to deploy, manage and optimize mobile advertising campaigns. Nokia Advertising Connector is a white label solution that acts as an 'intelligent switch' by serving adverts best suited to the consumer's device and usage context.

Ovum's principal analyst, Eden Zoller, comments:

Nokia is positioning itself as a mobile advertising service provider, which is a bold move as the market is becoming very competitive from the platform and provisioning side of the equation.

There are already several established and respected mobile advertising specialists that taken together provide the full range of services from the creative side through to ad sales, provisioning, delivery and campaign management and reporting. In other words, they have got the mobile advertising value chain well covered.

At the same time, mobile search specialists are increasingly focused on advertising, such as Jumptap, Mobile People and Modeo. And of course Internet giants like Google and Yahoo! are joining the party.

There are a lot of partners for the advertising community to choose from and Nokia will have to fight to stand out from the crowd. In Nokia's favour is the fact that it is well on the way to becoming a Web 2.0 service provider.

It will be interesting to see how mobile operators react to this development. Nokia is not looking to compete with them but instead wants to act as a service provider.  However, some may be uncomfortable because Nokia wants to place itself at the centre of a mobile advertising community that it controls in terms of provisioning and, presumably, revenue flows.

Operators like 3 want to do something similar themselves - though clearly others will not and are seeking strong partners that can take the strain for them in the form of a managed service solution.

Nokia might seem a friendlier, more familiar entity than the likes of Google, and has more clout than some of the pure play mobile specialists given its strong relationship with many operators. Then again, there is no reason why it should not partner with the pure play specialists here.    

Nokia has conducted trial campaigns based on the Ad Service proposition and claims good results from a technology and consumer experience perspective. The managed Ad Service proposition is designed to support interactive content such as click through banners and embedded advertising in applications. Nokia Ad Service will be showcased this week at ad:tech, an interactive marketing event in Paris.

 

It is expected to begin operations globally in the second half of 2007.

The white label Nokia Advertising Connector will serve ads based on text, audio and visual/video based on the usage context, for example the difference between someone watching mobile TV or playing a game. Nokia is currently piloting the solution, which is expected to become commercially available towards the end of this year.'

Eden Zoller is a principal analyst with Ovum's consumer group practice

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