Tarana Khan

<FONT COLOR="#FF0033"><B>Digital: Quest for speed-dial in mobile advertising, Part One</B></FONT>

Mobile operators are too busy building up numbers, consumers aren’t looking beyond the basics, but everyone wants to have a mobile strategy. What’s going on?

Mobile advertising in India is a paradox wrapped up in a ringtone, couched in wallpaper.

Consider this. In a furious race to fuel mobile adoption in India, operators don’t seem to care about value-added services. At least, not yet. And, mobile Internet consumers (estimates vary, but about 5 per cent of the user base of 170 million has access to GPRS - general packet radio service) aren’t looking beyond the usual ringtones, eye-candy downloads, and games. But then, funnily enough, every publisher worth his salt has a mobile strategy in the works, and mobile content developers are working feverishly to create killer applications.

What gives? Clearly, many players are betting on explosive growth in mobile Internet once operators look at other ways to grow average revenue per user (ARPU). As things stand, in terms of access and pricing strategies, digital mobility is not on the radar. Even if the players say otherwise. “Content and information consumption will continue to shift to the mobile device (like music, gaming, TV and news), as more and more people will begin to utilise their time more productively while on the move,” says an Airtel spokesperson.

<FONT COLOR="#FF0033"><B>Digital: Quest for speed-dial in mobile advertising, Part One</B></FONT>
Technology-watcher Rajesh Jain, CEO of Netcore Solutions, offers another take: “For mobile Internet to happen, mobile operators need to believe that data, not voice, will change the direction of the ARPU trajectory. A time will come – in the not too distant future – when voice will go to zero-margin and then to zero.” Jain’s solution: an open, operator-neutral platform that can be accessed by all users.

So, why would you bet on mobile advertising? Well, global ad spending on mobile phones was $1.4 billion in 2006 (a fraction of the $17 billion online ad revenues in the first quarter of 2007). In Japan alone, the spending was about $320 million. In India, however, mobile is on every marketer’s mind, but advertisers have only text and voice to play around with (that too, has been restricted by the Supreme Court for being unsolicited by consumers.)

Says Rajan Arya, DGM, Client Alliances & Business Development at Bugzy, a mobile content company, “Sadly, advertisers do not think or understand the value of mobile advertising as a viral in the complete value chain. For them, mobile advertising is all about spamming and short code traffic... It’s much more than that.”

‘More’ means running an interactive banner on a mobile site or creating exclusive mobile videos, mobile zones or music clips. For now, mobile advertisers think they have done their bit by placing display banners on mobile sites, completely ignoring the interaction that the device can offer. Short codes on SMS rule the day, not giving much opportunity for continuous interaction. Video advertising is virtually non-existent and voice is underused. So, when will mobile advertising reach the next level? Industry players feel that it could take between 12 and 18 months, optimistically, for mobile advertising to become reality.

(Tomorrow, in the second part of this story, we look at emerging mobile advertising platforms.)

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