cbs-loopt-logo-lockup-mobilestance-copy.jpgCBS Mobile will begin incorporating GPS and other cell tower-based location data supplied by Loopt, a location-aware mobile social networking service, as a targeting parameter for advertisers purchasing banner ads on its suite of mobile websites, such as CBS Sportsline Mobile (http://cbs.volantis.net/sportsline/) and CBS Mobile News (wap.cbsnews.com/news), this according to The New York Times. Loopt has stated that their deal with CBS is not exclusive, opening the door for other mobile publishers and ad networks to follow in CBS’s lead.

While the move is notable in that CBS Mobile becomes the first North American publisher to bring location-based mobile web adverting inventory to market, it should also be noted that Loopt is currently only available to Sprint Wireless (and Boost) subscribers on a limited number of handsets. Loopt, a Silicone Valley startup, recently raised $12MM in Series B funding.

Eagerly awaited by some, the concept of true, location-based mobile advertising has, overnight, moved from the realm of the hypothetical to the desert of the real. For years, it seems, we have all been nibbling at the margins of the issue, exploring and debating from a safe distance. Now, as this once academic curiosity becomes cold reality, we are forced to examine the issue from a more practical perspective.

  • Privacy. It seems that the idea of Location-Aware Mobile Advertising cannot be explored without first discussing privacy. But while previously the focus was on generic privacy issues such as transparency and security, we are now free to explore the issue in the most concrete of terms: Has Sprint / Boost / Loopt specifically secured user permission to pass (or sell) their personal location data to third parties (such as CBS or their ad server) , or is a more dubious, “opt-out” mechanism being employed? Who will be held responsible if an unthinkable security breech occurs, such as a the “hijacking” of a user’s GPS data for malevolent or even criminal purposes? Clearly none of CBS’s major brand advertisers are eager to chart this new territory themselves, as it has been reported that (as of press time) none have purchased any of CBS’s GPS-targeted mobile advertising inventory.
  • Scalability. Privacy issues aside, there will be plenty of local, regional and national advertisers saying, “Great! Where can I get some of this?” This will be good news for CBS, as their mobile inventory is likely not flying off the shelves (this assumption is based on the fact that the network currently feels the need to augment its national sales force with four mobile ad networks – Third Screen Media /AOL, Millenial Media, AdMob and Rhythm New Media – in order to begin to fill its mobile inventory). How then, will advertisers purchase the GPS inventory? How will the local ad inventory be parsed, tracked and forecasted (this, across all of CBS’s five individual sales channels no less, most if not all utilizing different (if not incompatible) ad serving platforms!).
  • Economy. From the media buyer in me: How much of a price multiple does one place on GPS targeting? Will it follow current media targeting models, and increase based on the granularity of the location-targeting? Surly some areas (say – 5th ave, between Central Park South and 46th St) should cost more than say, the outskirts of Palm Desert… but how much more? Sure, we can all agree to “let the market” decide – but this is the same market that has settled on $45 on deck CPM’s and an estimated 16% monthly inventory fill situation (sources confidential)… not exactly a trustworthy market to be sure. Where’s the self-service, auction-based play on this one? (AdMob, are you listening?)

Analysis: While on its face the Loopt / CBS deal represents a minuscule number in terms of actual audience reach (not to mention reach potential… with Loopt users probably representing less than 1% of the US pop), the marketplace affects cannot be easily overstated. We’ve finally gotten beyond relatively simple questions of if or even when a major US carrier will start utilizing GPS data to target mobile ads, and into the much more interesting realm of real world applications.

mobilestance world of WAPcraft warcraft GFXThis week was marked by an extraordinary series of high profile Mobile Web developments… which, when viewed in aggregate, were seen by many as evidence that the nascent channel has finally reached an inflection point.

All three major areas of the mobile web “ecosystem” (carriers, publishers and advertisers) announced significant site launches, partnerships and traffic milestones, including several blue-chip advertisers and content publishers such as American Airlines, YouTube, Yahoo!, NBC, ABC, A&E and the New York Times.

Despite these encouraging developments, several notable marketplace events served to point out the shortcomings of the emerging mobile web space, including a reminder of a glaring limitation of the mobile web from a metrics and reporting standpoint, as well as accounts of a public tirade involving nearly the entire mobile value chain – from one of the mobile industry’s more prominent (and animated) executives.

A busy week in the World of WAPcraft to be sure… here’s some of the major highlights:

  • Carriers. Last week’s most significant Mobile Web development came from AT&T Mobility, who announced a strategic alliance with Yahoo! whereby the internet giant will begin serving ads on the carrier’s “MEdia Net” mobile portal. Under the terms of the agreement, Yahoo! and AT&T will divide up the on-deck advertising inventory for sale and/or for internal use. Additionally, AT&T ‘s yellowpages.com will now power local search on both AT&T’s Mobile and Wireline Web properties. AT&T has not yet announced when these changes will take affect.

    AT&T Mobility’s move follows earlier moves by Sprint and Verizon Wireless. Collectively, the three carriers represent approximately 78% of the US mobile market. T-Mobile, the last of the “big four” US carriers without an on-deck mobile advertising play, has tied up with Yahoo! to serve ads on its UK “Web’n’Walk”mobile portal. Clearly the announcement from AT&T Mobility would inhibit T-Mobile’s ability to expand their Yahoo! relationship here in the US.

  • Publishers. This week witnessed an abundance of mobile website launches and/or relaunches from many of the larger content providers. YouTube announced the launch of its new Mobile Web site (m.youtube.com), as well as a new J2ME application (supported on Nokia 6110, 6120, E65, N73, N95 and Sony Ericsson k800 and w880). NBC announced the launch of 40 new WAP sites (as well as 3 new mobile video channels), including dedicated mobile web sites for NBC programs such as 30 Rock, ER, Friday Night Lights and Saturday Night Live. Not to be outdone, ABC News announced that its mobile site (m.abcnews.com) would be providing “real time” US presidential election results, although Mobile Marketer reports that ABC refreshes its mobile website content [only] on an hourly basis.

    On the cable side, A&E Television announced the launch of mobile the A&E Network portal (mobile.aetv.com), as well as dedicated sites for The History Channel (mobile.history.com) and The Biography Channel (mobile.biography.com). The A&E mobile sites feature fairly standard mobile web fare, including “What’s on Tonight”, “Program Descriptions and Photos”, “Fan Polls and Trivia Games” and “Downloadable Wallpapers and Ring Tones.”

    Finally, moconews.net reported that the New York Times mobile website is now generating an average of 10MM page impressions per month, a 600% year-over-year traffic increase.

  • Advertisers. American Airlines announced the launch an extravagant new mobile web site that is sure to raise the bar for mobile websites in the airline category. The site utilizes a common URL approach (www.aa.com), which automatically redirects mobile users to device-appropriate site versions (although mobile users have the option of reverting to the full HTML site, an option that hopefully will soon become a standard feature on most mobile websites). Currently the AA.com mobile site features include the ability for users to “check in for a flight, view their itinerary, check schedules, check the status of their flights, get information on destinations, weather or airports and contact American Airlines.”

    Future AA.com mobile enhancements targeted for a Spring ’08 launch include the ability for users to “book flights, change their reservations, view fare specials, request upgrades and enroll in” American’s AAdvantage loyalty program. Additionally, the carrier states that “many pages also will be viewable in Spanish.”

  • Criticism. UK SEO provider AccuraCast cast a spotlight on Google’s inability to effectively track conversions generated from AdWords Mobile. The challenge faced by Google is that its ability to track conversions relies on either Java script (embedded on a publisher’s page) or tracking cookies – technologies not supported by most (if not all, in the case of Java) mobile web browsers. To its credit, Google acknowledges its system’s shortcomings, noting that “conversion rate, cost-per-conversion, cost-per-transaction and value/click are adjusted to reflect only those sites from which we can track conversions.”

    In lighter news, this week at the AlwaysOn Media event in New York City Cyriac Roeding, SVP of CBS mobile, unleashed a public rant against the complexity and inherent dysfunction of the mobile ecosystem. Apparently no one was spared from Teutonic executive’s assault on the mobile industry; From the carriers (there’s too many of them! lack of technology standards! too many pricing options! too many service packages! poor marketing!) to the publishers and handset manufacturers (poor usability! content poorly organized!) and even the advertisers themselves! (they don’t understand mobile or the value it brings!). While attendees reported that Mr. Reoding’s “marketplace observations” were greeted with wild applause, mobilestance finds it ironic that the current Chairman of the Mobile Marketing Association Board of Directors would choose to publicly rebuke, ridicule and embarrass nearly all of the organization’s members.

Analysis: While development of the mobile web ecosystem seems to be accelerating, it remains to be seen if a critical mass has been achieved – both in terms of users – as well as content. Still, all the major players in the space (carriers, content publishers, and advertisers) are taking the necessary steps to advance the channel towards reaching the seemingly inevitable goal of mainstream use. That said, it is clear that several prominent hurdles (most notably usability issues such as UI and network speeds, as well as the inability to cookie most mobile devices) still stand in the way of large scale consumer adoption and commercial exploitation of the mobile web.