Ad supported music: MySpace Music vs. imeem

Fortune published an excellent article about the upcoming competition between imeem and soon-to-be-launched MySpace music.
(Lirix CEO Blogs:) "The piece contains some good information regarding CPM rates at the online ad-supported music services. The author points out the dilemma well known to those in the field - that these rates are quite low.

Ad-supported music will not escape the low ceiling of online display advertising CPMs until it moves from streaming to downloaded tracks."

Beyond this must-read article, what I found interesting are the numbers. imeem CPM=$4? wow, not bad. I'm hearing not to bet on $5 on mobile CPM, knowing location, age and possibly gender.

A good problem to have

As an engineer who turned to marketing, I keep coming across situations where you want to promise the sky, but you also know the limits. A good lesson one of my previous CEO taught me was: whenever you think of starting the limitation "BUT...", that's when you put the lid on it.
Because that's how technology moves forward. If customers were buying existing technology there wouldn't be any innovation. This is why you want to keep your sales guys somewhat aware of what the product can (or rather, can't) do, but they and the market are the ones who will pull you forward.

The thing is, sometimes you cheat. You know the product can't deliver to the spec. Do BMW's really make it to the top speed? who knows? whose going to test it? The wisdom is not to get caught, at least not big time.

Because when someone calls the bluff, it can become painful. And I think that's what's lined up for operators with their data network. They were betting on lack of applications that will drive the data network. And they were right for the longest while.
Now, when video is hitting the mobile space, uplink and downlink, it is becoming difficult, and frightening.

So when I read this article about "Researcher warns on flat-rate plans’ effect on carriers", and I read "ABI is also worried that unlimited plans may encourage an increase in unsolicited text messages, instant messaging and picture mail usage.", I think, no, they've got the wrong end of the stick. This is the time to crack the champaign. Because for the longest time mobile geeks complained about people "not getting" picture messaging, Mobile IM, Mobile video etc. "usage/adoption is low" you could hear everywhere.

Well if now people get it, then there could not be better news! That is a good problem to have like my friend Jack always tells me. The operators need to figure out how to keep up the technology and harvest the revenues: making their network perform, and cutting rev share deals with content owners and advertisers.

The battle over the idle screen

I've already made a post on the combination of your favorite feed on your idle screen. Several startups are looking at "non-intrusive" ads on the idle screen:
Celltick’s LiveScreen ‘bypassing operators’ with direct to consumer mobile ads.
what does that do the consumer I'm not sure, to see floating ads on your idle screen. Big yawn me thinks, and rightfully the Ewan writes "I’ve had more than a decade’s worth of experience of dismissing my phone’s standby screen whenever I want to ‘do’ something on it."
BTW, check out Cellogic, who are also in a similar space.

But what if...what if that idle screen had your favorite RSS feed, a mobile version of Google Reader, Facebook feed, including presence/location/mood updates from your contacts in your integrated address book?
There are enough kids out there burning idle time on various occasions between music (hum...publish a playlist from your phone...), games and much more. they would love the trigger from their friends through their social communities on the idle screen.

I think the idle screen is uncharted landscape that will go far. Far beyond advertising for sure.

Ad-based UK Mobile Operator Blyk launch service

I am very excited about this. In my scale of innovation, leadership and entrepreneurship, this is as good as it gets.

For a while now I've been telling stories about a mobile operator who is basing their business model on advertising, Blyk. Well these guys have announced the launch of their service in the UK.

The reason this is very exciting is because (A)- it puts to test the notion that mobile advertising can energize a mobile operator to have a compelling service and take away a lot of the monthly subscriber fees and (B)- you know Google is watching this very closely. Blyk are a virtual operator, based on Orange UK, targeting a specific age group, 16-24 (does this sound similar to T-Mobile USA's sidekick target crowd, who just announced the deal with MySpace?). They have interesting concepts and learnings they've accumulated during their pre-launch research:

(Blyk's About Page:) "Blyk has built a service around what young people want and need – free communication, ease of use and relevant messages from brands. Blyk has developed its offer by finding out what its members consider most valuable – this will evolve over time as their needs do."

(from the press release:)
“We found that what is 90% familiar and 10% new leads to the best user experience. So, the Blyk communications formats are based on the most dominant and most familiar pattern among 16-24s: Getting a message and responding to it. Both picture and text.”

"Our free offer is 217 texts and 43 minutes every month and this could mean no more phone bills for up to 4.5 million young people in the UK - with no contract. We have the brands that want to speak to them too, with more than 40 already signed up for the launch. This group represents almost every industry sector there is.” "

"For brands, Blyk is an innovative, new media channel, providing direct access to the 16-24 year old market; enabling them to create awareness, build relationships and drive sales to this hard to reach audience. "

This can truly change the way we think of the operator-vendor-subscriber game. it would introduce new forces into the game, with a lot of energy. this is all very exciting.

GOOD LUCK folks!!!

On Personalization of Mobile Advertising

According to Sydney Morning Herald, The mobile advertising market is expected to be worth $11B by 2011. But its down to creating the right channels and formats, getting to the right consumer, the right way.

In recent years the efficiency and optimization of web assets has become a huge industry: from learning how to reach the desired audience, to maximizing the opportunity once you have that audience at your page. Efficient advertising makes a world of difference in the outcome of lead generation and sales.
From the eyes of a non-web guru, two key factors stand out when trying to optimize web content and advertising:

• Awareness to the viewer's context: content can be made relevant to samples from the viewers context. for example, Location-aware advertising, based on the user's IP address can suggest local culinary options for the tourist. Geography and Time-aware advertising can display relevant entertainment events. These parameters and others are typically available in the HTTP header of every PC browser request.
  


• Personalization: highly efficient advertising could be trying predict what might YOU want to buy next. Keeping track of ones web purchasing history, visited web content etc. could help in that. There are obvious "big brother" implications but when there's enough value presented, users may opt-in. Amazon, for example, tracks the user's recent interest and purchasing history to generate 'you may like this too' offerings, not to mention the one-click checkout

Take the leap back to the mobile world, where players today are trying to figure out today how to introduce mobile content, advertising, coupons, loyalty etc.
Quick comment: In a MIT conference perhaps two years ago, T-Mobile CTO, Hamid Akhavan commented that the initiatives that will succeed in mobile had better learn from their "non-mobile" parallels (where applicable) and get better. (He's not use that exact language, so excuse the interpretation).

Introducing relevant mobile web content is quite challenging: the physical dimensions, data plans, usability are all factors playing against this initiative. But keeping optimistic and hoping that all users one day will have data plans and usable web accessible devices, let's take another look at the two factors we mentioned:

• Mobile context awareness: Interestingly enough, beyond just optimizing the ad to the content served, "mobile" encapsulates more interesting dimensions to the 'viewer context'. for the most part, since the user is on the move, they will be out of their familiar home and their search could become much more effective. For example, local culinary web advertising might be far more effective out of home than at home: you already know the restaurants you like close to home. On the other hand, getting the user's location (from their IP address) is not as trivial on mobile as it would be on the web. Here's an interesting snapshot of mobile search: (from MobHappy:) m-spatial provide white label local search for the likes of Orange, O2 and Vodafone, as well as personal navigation devices. They’ve just announced a list of the terms users are most frequently searching for on their mobiles.


• Personalization: I believe that personalizing ads on mobile is far more important than on PC, because the users would be less tolerant of irrelevant spam. However, awareness of the mobile user's identity is more difficult. Identity tokens on PC browsing (For example, when you launch GMail, you get right into your inbox and not being asked to login again) is generally managed by cookies and Javascript. Technologies that are just being introduced to mobile browsers. Another ad-hoc way to identify the 'static' consumer is their IP address. You would be surprised how much information can be extracted and monitored over time by just using your IP address. That's all good, but when you think mobile, mobile IP addresses are dynamically allocated: every time you connect to the mobile web your phone is allocated a new IP address by the wireless service provider. So, assuming no cookies and Javascript, being unable to track activity by IP address...what can be done to identify mobile users and personalize content for them?


• Add the user identity to the HTTP headers on the mobile browser: Phone vendors could have identifiers (IMEI, IMSI, ESN,...) added to the mobile browser, but they would risk a consumer "big brother" backlash. Mobile application developers (especially community builders) could have their subscribers pre-register and link their phone to their account, then transmit identifiers to the web. This approach would definitely require user opt-in


• IPV6: I'm no expert on this one, but I understand that in the days of IPV6 there will be no shortage of IP addresses so mobile users could have 'static' IP addresses, which would make them similar to the non-mobile users: an IP address could identify a user over time. I also understand that deployment of IPV6 technology across wireless infrastructure and phones will take some time.
  


• Looking at the Operators' WAP Gateway: when users launch their web browser they get through a series of components in the wireless operators' architecture that, amongst other things, authenticate the subscriber, make sure that are allowed to access the web (they have a data plan etc.) and monitor their activity (mainly for billing purposes. for convenience, let me call this set of components 'WAP Gateway'. The point is, when the subscriber hits the web on their phone, the operator knows exactly who they are and what are they looking at. Bang!. But- hold your horses: operators can't, and won't expose this information: there are privacy issues, and also, this database, used in the right hands, is worth piles of money. So what's the alternative? become the "inside man". Operators are well aware of this potential, but have different opinions on the effort they are willing to make to create sufficient infrastructure for advertising. Teaming up with the likes of Comverse, who provide the infrastructure and have a hand at all the components, would mean that operators can enable advertising, and advertisers can become mobile.
  

Optimizing mobile advertising to the context and identity is required. Not only would it increase its effectiveness on advertising, without it users would become very unhappy. Creating the alliances with the players in the ecosystem is critical to unleash a very profitable future for mobile.

Thanks for reading!