Hold The Phone! - Third Screen Media
May 2007

Mobile Advertising Technology Providers

In this edition of Third Screen Media’s ongoing byline series for The Messenger, we’ve opted to turn the attention to those folks behind the scenes that are delivering the necessary solutions and services to make mobile advertising a reality: the technology and its essential providers.

In our overview of the mobile advertising ecosystem, we’re looking across the value chain and highlighting each player’s offering and their relationship to each other.  We’ve already discussed the content providers — companies like <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />USA TODAY, MSNBC and The Weather Channel—who’ve come to mobile en masse to engage a swiftly growing wireless content audience and provide an extension of online and television programs and services. Next we spoke about the carriers, companies who play a unique role—one unseen in the world of traditional advertising, such as print, broadcast, and even the wired Web.

Ask any individual involved in mobile advertising and they’ll tell you that the next big growth surge in the industry hinges on the adoption of innovative technologies on the mobile platform, so it behooves us now to look at these integral players.  Technology providers and enablers are flocking to the mobile channel, whether new startups or companies that have made their mark on the wired Web. Even cell phone manufacturers—including Sweden’s cellphone giant Nokia—are getting in on the action, capitalizing on a market that is projected to reach $19 billion in just four years.

In order to understand technology’s vital role in the provision of advertising on cellphones, it’s important to note that the planning and buying process, whether online, television, radio or print, exists largely as a non-integrated effort, requiring separate solutions and agency arms to grapple with the complexities of each particular media type. And in the instance of the Internet, they’ve had years to tinker with the delivery of advertising with the introduction of each new technology.  Advertising buyers and sellers initially came together in a simple ecosystem with basic banner ads: no animation, no video, just a banner or text link with rudimentary measurability. Over time, the medium evolved into animated gifs, and eventually additional providers brought in an exciting new—and difficult—form of advertising: rich media, which grew to encompass in-page and streaming video.

The wireless ecosystem comes with added complexity, as it consists of more than just advertising buyers and sellers. An additional entity—the carrier—brings in an entirely new player into the advertising mix. Carriers are unique players on the platform, as they have moved beyond simply providing bandwidth. Carriers play a very active role and rightly so, as they have spent many hundreds of millions of dollars building extensive networks. Their customers, also numbering in the many millions, represent a very valuable consumer base—the recipients of targeted advertising.

And now, with the introduction of mobile advertising, there is a compelling opportunity to eliminate the separate media silos in mobile, integrate the planning and buying process, and reach consumers with interactive, innovative and creative advertising across the four mobile media types: video, WAP, downloadable applications and MMS. Enter the technology providers.

The wireless advertising ecosystem is faced with addressing multiple media format complexities while still in its infancy. Not only are four media types developing simultaneously, but tech savvy publishers, advertisers and agencies also expect immediate measurement and immediate integration. In short, they expect the ecosystem to learn in a short timeframe—a mere 12 months or so—what traditional and online advertising across multiple media formats had years to learn. With multiple screen sizes, resolution options and numerous device types, the mobile handset presents a world of management and delivery intricacies that call for a consolidated platform that simplifies the complexity of effective and efficient advertising across multiple mobile media types.

With each media type, the technology necessary for delivery is complex and unique. Solutions that consider the dynamics of each advertising campaign—and specific media type requirements—are now in place to address these complexities.

For now, WAP has become the de facto landing spot for many of the initial and most current mobile ad campaigns. While similar to the wired Web, WAP banner advertising is in many ways much more complex. With more than 1,600 cellphones to consider, each with its own coding and requirements, the role of the technology provider becomes paramount.

Mobile downloadable applications are one of the hottest, latest developments.  And for good reason.  The arrival of dynamic ad insertion—where the ad changes over time and as appropriate to the user within an application—has led brands to explore this delivery method with great zeal.  Downloadable applications offer a richer experience than WAP and continue to grow in popularity as more content comes to the third screen.

Comparable to HTML e-mail, MMS (Multi-Media Services) offers another avenue to reach consumers on mobile, complete with banner, video or scrolling text.  With challenges of its own—including a lack of cross-carrier standards—MMS provides a one-to-one relationship between consumers and their respected brands, but the idea of spim (mobile spam) exists. Currently, it’s the least developed and utilized media type in mobile advertising.

Video promises to be the next new delivery model for mobile advertising, as brands are seeking ways to capitalize on the popularity of online video content.  Numerous mobile devices are now capable of receiving and displaying video files or streams received over the mobile network. To date, most of the videos received and viewed in the mobile space have been limited to a file sent to the mobile device for playback, but Verizon’s V-cast, MobiTV and now Qualcomm’s MediaFLO are popularizing streaming and broadcast video offerings. To date, we’ve seen that video’s slow growth in mobile advertising is in part due to the still-forming value chain of technology providers needed for dynamic ad insertion.

Regardless of the media type, the delivery of advertising requires players that understand the complexities of mobile advertising and know that in order to capitalize on the market’s growth, it’s essential that it’s all made simple for the buyer.  To this end, integrating the four mobile media types into one central dashboard for both buyers and sellers will certainly help to facilitate and accelerate the success of the emerging mobile advertising industry.

Our final issue in this series will look at the buyer—the advertising agencies—to see how their role is shaping the industry and leading more brands to join this exciting, growing marketplace.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />