mobilestance.com

Bloomberg.com published a piece today about how the carriers are keeping the cost of mobile advertising artificially high due to carrier revenue share. Google, Yahoo and Microsoft are apparently upset that they must pay the carriers a percentage of ad revenues generated by carrier referral traffic (i.e. traffic coming from the carrier portal, or “deck”).

I’m a bit neutral on the topic myself. The carriers have every right to charge for what is a pretty big value add in mobile – generating traffic. If the portals feel they don’t need the traffic, let them try to survive on a 100% off deck model (as opposed to the hybrid strategy currently employed by most major mobile publisher brands). Obviously the portals value the traffic generated from their presence on the carrier deck, or they wouldn’t be there in the first place. What I do take issue to is the artificially high CPM “price floors” set by the carriers, but that’s a topic for another day.

I must (partially) disagree with Chad Stoller of Organic, who is quoted in the piece as saying that “the carriers are too busy trying to protect the money they are making now to look at the next way to make money.”  In my view the carriers are simply grabbing the money now while they can. Most agree that their walled gardens are on borrowed time, and with the open handset alliance and other initiatives, it’s only a matter of when – not if – the carriers iron grip on the mobile spigot will come loose. Until then, it’s hard to begrudge a company for leveraging their position for immediate gain, just so long as the long term prospects are not jeopardized.

Long term, the carriers face a bleak scenario anyway – one of the dreaded “dumb pipe” syndrome (ad integrated location data notwithstanding). But let’s face it, that’s really what they are… they’ve just been damn good at pretending they’re providing value in other business value chains (media, entertainment, commerce) for the purposes of immediate revenue streams.

And for those that are willing to do some digging…  quality off-deck inventory is available for way less than the $50 CPM often quoted in the industry press.

The Nielsen Company released some new statistics about the mobile habits of US tweenagers. The study revealed that 35% of the demo own a mobile phone, 20% use text messaging, 21% use ring and/or answer tones, and 5% use the mobile internet.

Amazingly, what is oft looked at as a “youth channel” remains anything but. The “sweet spot” in US mobile marketing remains the 18-34 segment, with teenagers remaining viable for most mobile entertainment propositions, and the 35-44 year old segment still leaning towards utilitarian uses of SMS and the mobile web.

Remarkably, the tween mobile profile is nearly identical to the 55-64 segment, if only in terms of handset ownership and frequency of mobile data usage… although I am quite sure that the mobile data usage cases of these two segments are quite dissimilar in terms of content, context, and value proposition!

According to Moconews.net, Nokia and Universal Music are adding their names to the long list of firms looking to unseat (or even gain market share on) the Juggernaut that is the Apple iPod / iTunes. The two are “teaming together to offer free 12-month access to music from Universal’s artists to buyer’s of Nokia’s musicphones… people will be able to keep the songs once the free-offer period expires. Nokia wants to get other labels to sign up to the ‘Comes With Music’ product, which it hopes to launch early next year.”

While offering free music isn’t (remotely) a new tactic in the digital music market space, what makes the move somewhat notable is the combination of the world’s largest handset manufacturer with one of the largest music labels. Likely this initiative is in reaction to the iPhone’s European launch, as Nokia tries to defend its turf from an invading, buzzworthy handset. Nokia has reason to be alarmed, as their musicphones have not sold particularly well (even in Europe, a market otherwise dominated by Nokia).

Should the iPhone successfully convert current iPod owners to the new device, suddenly Nokia has a lot bigger problem than an underperforming musicphone unit: Apple will have secured foothold in their core handset market – right in Nokia’s backyard. I would not be suprised to see more, even more aggressive announcements like this moving forward should the Apple iPhone gain traction overseas.

From the “next big thing” file, the latest in mobile’s long tradition of incredulous, industry-promoting “research studies” comes from Screen Digest, who conclude that there will be over 28 million mobile video subscribers in North America by 2011. That’s right folks… in a scant three years mobile video is expected to increase by a factor of 20! Never mind that recent surveys have demonstrated that US consumers have little interest in mobile video, or that m:metrics has shown that only 0.6 percent of US mobile subscribers are currently utilizing mobile video services.

The Screen Digest press release makes little mention of research methodology, other than that “The data in this press release is taken from Screen Digest’s latest report, Mobile TV: Business Models and Opportunities. The report includes analysis of the current market situation, business models and value chain, as well as analysis of the delivery mechanisms, broadcast technology and the impact of regulation. 25 countries are reviewed in the report.”

More than likely Screen Digest’s release and corresponding “report” are designed to fuel the speculative bubble that has enveloped the mobile space for the better part of the last decade, giving the pitchmen another bullet point in their case for the “huge, can’t miss opportunity” that is mobile video.

Too bad, really… as it’s “research” like this that has continued to misalign expectation of the channel, and usually only serves to thwart the efforts of legitimate mobile marketers in the space.

So much has been written in the last week or so following the announcement by Verizon Wireless that they would be opening up their network to handsets sold by third parties, and that they would be streamlining the (currently) painstaking process of third party application development.

Most have focused on the reactionary nature of Verizon’s move, that it was simply a defensive move to counter the coming Android threat, AT&T’s iPhone, as well as to satisfy the new FCC rules governing the upcoming Spectrum Auction… rules also pushed through in large part to Google’s marginally-successful Congressional lobbying efforts. In general, the bulk of the coverage from the mainstream media and major industry blogs have largely written off Verizon’s move as a token gesture that will have little impact on the market for at least the next several years. In many ways these publications are correct, yet clearly they have missed the larger picture.

But to the mobile marketing community, as well as the marketing community at large, the shift represents the beginnings of a long-awaited shift towards a working Mobile Marketing system. I say “working” because the current environment of carrier-specific technology standards and business practices makes for an overly-fragmented, cumbersome system that seems counter its own ends. Divergent carrier technologies notwithstanding, the idea that third-party developers can now publish applications on the Verizon network without having to be “approved” by the carrier is a watershed moment in US mobile marketing, opening up roughly 25% of the marketplace that was, until now, more or less unreachable to the “free to the end user,” advertising-supported model.

For US consumers, innovative and (just as important) inexpensive (handset and/or ad-supported) mobile applications will become far more commonplace, as handset manufacturers will now have the freedom of preloading applications that consumers (rather than the carriers) are interested in using. While these handsets will inherently carry a higher MSRP due to the lack of carrier subsidy, it is my prediction that pricing for “non-carrier subsidized” / D2C handsets will ultimately not become a barrier to purchase, as consumers will value the benefit of getting the handset they (actually) want, rather than being forced into the handset the carrier wants them to have.

Change is a beautiful thing.

No one really expects that they will actually win the bid, or even wants to… why then is Google engaging in this escapade?

a) to further push open standards, so as to aid in Android penetration?
b) to aggregivate Verizon, AT&T, T-Mobile and others?
c) world domination, FUD-style