Mobile Advertising: One-To-Many Multicast Would Pay Dividends, So Why Aren’t We Doing It?
Mobile advertising may be a hot topic, but few have really got their head around how to deliver it in such a way that it makes sense – and money – for the companies involved. The answer may have been there all along in the example set by print and cable companies that have built their bottom line on delivering advertising to a mass markets – cheaply and effectively. As Tom Wheeler, a managing director at VC firm Core Capital Partners, writes in his latest column on TMCnet: “Mobile advertising is a one-to-one operation, and as a result relatively costly to deliver.” Sending one message to mass audience (as is the practice in print and cable) costs “virtually nothing to deliver compared to the one-to-one unicast of mobile distribution.”
Fortunately, the technology pieces are falling into place that will allow mobile operators to effectively broadcast advertising to their customer base on a “virtually costless basis.” The answer lies in a one-to-many multicast approach supported by technologies such as MediaFLO and DVB-H. In addition to video, mobile broadcasting technologies offer the potential for “datacasting” (the delivery on a one-to-many basis of a datastream containing information.
Taking this a step further Wheeler suggests datacasting would be a boon to mobile advertising. “Instead of sending the McDonald’s ad one at a time to mobile subscribers, why not send it once to everyone, cache it on the phone, and then let the network call it out of the cache as appropriate to be inserted into the content?” After all, he continues, this is exactly the way the local cable system does its local advertising. (At the appropriate time in the national network feed the locally stored ad is inserted and sent to all subscribers watching that channel.) “To make this work on mobile is a no-brainer with datacasting — it’s even possible once the ad is cached on the phone to insert the commercial which was delivered via MediaFLO or DVB-H into non-FLO or non-DVB-H programming.”
Granted, datacasting does cut some costs out of the equation. But it’s also quite a leap to assume mobile advertising can be similar to print and cable in the first place. The jury is still out on whether users won’t reject advertising as intrusive – and Wheeler doesn’t detail how mobile operators can ensure the ads are at least relevant to the content and apps (so they don’t blatantly appear as spam to the users who receive them). Sure, the network can call ads out of the cache as appropriate to be inserted into the content - but that assumes the commercial-like ad message and model will prevail. (Highly unlikely if you look how empowered consumers are turning a deaf ear to advertisements and consuming content on their terms…) Indeed, more progressive companies tell me they are well aware the mobile phone is personal and so requires them to deliver advertising in tune with the individual’s profile, past preferences, browsing patterns and download history. It may be more cost-intensive but it may also pay off in the end.
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Comments (10)
Jun 2, 2007 8:28 AM
I agree with the One-to-many approach, however maybe what is needed is a “test” audience to verify the effectiveness.
Jun 2, 2007 9:27 PM
I have my doubts that ad revenue will ever be meaningful on mobile except for localsearch…..once gps enabled phones are mass market local search will explode
Jun 2, 2007 9:30 PM
only other way local mobile search can catch fire before gps is mass market is if the carrier can configure your phone at point of sale with a default location of your home address
Jun 3, 2007 3:26 AM
It’s an absolutely right approach. Sometime ago I told about my project - Cell PC Platform in the comments to mocoNews.net’s post. The idea is to bring for everyone an additional ad screen that is a 3-inch touch-sensitive display placed instead the keypad in a MotoRAZR2 clamshell design. It’s a hardware implementation of the mobile advertising channel. This second display in addition to US-International keyboard’s function is used for showing the sites’ menus of Mobile Web sites and API menus and toolbars of the programs.
Jun 3, 2007 12:49 PM
Some interesting discussion on this topic at: http://www.linkedin.com/answers/technology/wireless/TCH_WIR/49120-1145339
Jun 4, 2007 7:55 AM
The problem with this one to many approach is that it assumes that everybody wants to watch the same content at the same time. Besides a few big ticket live events like Big Brother and the FA Cup I suspect the world is moving in a different direction. Video on demand.
Jun 4, 2007 8:24 AM
It’s invigorating to follow this discussion - a lot of good points and ideas! Michael, I’d like to hear more about your project - feel free to take it off-line. Digger, thanks for the link - the discussion is well worth following and I encourage other readers to check it out. Wessel, your observation speaks volumes. We could cache the ads on the phone - but would we all be watching similar content in the first place? If relevancy rules - and advertising must fit with what we are viewing at that time - then it’s all about delivering the right ad to the right person at the right time. Not an ideal environment for a one-to-many approach…
Jun 4, 2007 12:03 PM
I agree on relevancy, but am skeptical of what I call hyper-personalization. I think there are five types of mobile advertisements (mass-market, subscription, personalize-later, niche, and hyper-personalized) and four of those are well served by datacasting. I wrote about it in my blog…
http://ojomobile.wordpress.com/2007/06/04/datacasting-and-mobile-advertisements/
Jun 5, 2007 5:41 PM
Hi Peggy (and everyone else),
This equation is not as complicated as it may seem.
Vmbc.tv has been “testing” this concept with very successful results on Sprint’s video services. If you have a Sprint phone, check out FAST LANE on channel 61, or go to Lifestyle at the main video deck menu and choose it from there. The channel is free and supported by advertising.
This technology takes advantage of current standards on all fronts:
From the viewer’s side, the content is free, people are watching, the jury is NOT out on whether or not people will accept advertising in exchange for free content. They DO accept it, and at a ratio that would blow your mind over subscription video.
From the carrier’s side, one need not wait for DVB-H, MediaFLO, WiMax, or any other new technology to receive consumer uptake. Existing handsets, 1X, EV-DO, QCIF, or QVGA are all supported.
From the advertiser’s perspective, the eyeballs are there and the data tracking points are interesting, and there are several ways to introduce advertising to the viewer, Vmbc.tv has four.
If anyone has any further questions, please feel free to email me - sjb at amlmedia dot com.
Regards,
/steven
Jun 13, 2007 3:16 PM
Hi. It was great meeting many of you at the mixer in New York.
The key here is the mainstreaming of content.. not it’s simultaneious casting. On-demand is a better model that fits this emerging dvr generation.
Giving users these two pieces along with universal accessibility creates an ad-worthy market. That is what we are betting on.