Whose profile is rising: Mobile marketing. The four largest U.S. carriers--Verizon Wireless, AT&T Mobility, Sprint Nextel and T-Mobile USA--took a major step toward fully embracing the possibilities of mobile advertising with an agreement to incorporate their mobile marketing guidelines within consumer best practices outlined by the Mobile Marketing Association. Per terms of the agreement, the operators will incorporate their respective mobile marketing guidelines and codes of conduct (i.e., "carrier playbooks") into a unified document under the supervision of the MMA, generating operational efficiencies upward of $200 million annually. The best practices are expected to yield a wealth of benefits, including a consistent consumer experience that standardizes key consumer disclosures, more efficient short code programs, quicker time to market for mobile campaigns, and more consistent monitoring programs and audit results.
Such operator commitment could not come at a better time for the mobile advertising business. While conventional wisdom holds that location represents the next evolution of mobile advertising, the industry is still some distance away from a truly localized mobile ad model, according to a panel of experts addressing the subject at last week's Mobile Entertainment Live! event. Even as national brands continue to earmark a growing percentage of their adspend for the mobile channel, there is little momentum behind mobile campaigns targeting specific geographic footprints despite user demand for content like local weather, news and sports. "We haven't seen the local merchant move into mobile," said Clay Kellogg, director of business development for mobile advertising marketplace AdMob. "It's still a big step to get to local merchants leveraging mobile."
Mobile advertising is nevertheless creating a connection between brands and consumers, the panel agreed. Kellogg cited the results of a recent AdMob campaign for the Land Rover automobile brand: In addition to 45,000 mobile video downloads and 7,400 wallpaper downloads, the mobile effort inspired 1,100 wireless subscribers to contact their local Land Rover dealership.
Also nurturing the growth of mobile advertising: Smartphone penetration. "If you're an advertiser, there's a halo effect that comes with advertising on devices people are in love with," said Cheryl Lucanegro, vice president of advertising with digital music service provider Pandora, specifically nodding to the consumer cachet enjoyed by Apple's iPhone. "The iPhone is the first time that brands started looking at mobile phones differently," agreed T.J. Person, senior vice president of mobile strategy for GMR Marketing.
Whose profile is falling: Mobile entertainment. Conventional mobile music and video deals were few and far between at CTIA Wireless 2009. Arguably the most notable paired mobile content provider Zed with Universal Pictures Digital Platforms Group to develop voicetones, ringbacks and wallpapers based on memorable moments and quotes from feature films including the classics Animal House, Sixteen Candles and Dazed and Confused as well as recent box-office hits like Role Models, Knocked Up and Forgetting Sarah Marshall.
And while first-generation mobile entertainment applications like ringtones continue to lose steam, there is still life in ringbacks; sales in the U.S. will surpass the $235 million mark in 2009, according to music performing rights organization BMI. Thanks to the 10 million U.S. subscribers now signed up for ringback services through their mobile operators, BMI said the 2009 numbers represent a 15 percent jump over the firm's 2008 estimate of $205 million and 68 percent above 2007 projections of $140 million. BMI adds that ringbacks now enjoy industrywide penetration of about 4 percent; rates fluctuate from operator to operator, going from less than 2 percent in some cases to as much as 9 percent in others.
Although new devices and operating systems are yielding new opportunities for mobile entertainment, an old problem--fragmentation--continues to pose significant challenges for content providers, according to MTV Networks' EVP of digital distribution Greg Clayman. Speaking at last week's Mobile Entertainment Live! event, Clayman said MTV is seeing major growth in mobile video, stating that U.S. consumers downloaded more than 100 million mobile clips in 2008, roughly double the previous year's total. In addition, mobile web traffic continues to increase, and MTV also has sold hundreds of thousands of premium applications developed for Apple's iPhone. "The apps business prior to the iPhone was a tough business for us," Clayman said, citing the expense of porting applications to multiple device platforms. Media platform fragmentation also presents continuing challenges for companies like MTV. "TV viewing is up this year, and cable subscriptions are up. Online viewing is also growing," Clayman said. "The problem is that it's all very separate. It's measured separately, and it's hard to put all of it together."
Artists nevertheless remain positive about the possibilities of the mobile channel. Calling himself "a Twittering fool," Matchbox Twenty frontman Rob Thomas praised new digital platforms at Mobile Entertainment Live! event, proclaiming that mobile and online platforms have "eliminated the middleman between you and your fans." Thomas was particularly effusive in his appreciation for micro-blogging service Twitter. The singer said that more than 9,000 fans now follow his posts. "At first it's daunting, but then you realize how easy [Twitter] is, and you begin waking up at 9:00 a.m. to talk to fans in your underwear," the self-effacing Thomas cracked. Thomas also announced that his longtime label Atlantic Records will spotlight Cradlesong by launching a mobile version of its desktop application Fanbase, which offers social media features alongside news, photos and video content. "It's a one-stop for me," Thomas said. "You're creating your own little world--your own little radio station and your own little news center."
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