Monday, 16 July 2007

Mobile - will it ever work?

"Mobile - will it ever work?" was the title of a short forum held today by the generally excellent Associated Online Press (AOP) and does actually give you an idea of the tone of the event.

Usually one walks into a barrage of scepticism when talking about mobile but this event seemed to bring together the industry's pessimists: I have not heard people be genuinely downbeat about mobile advertising for some time. Perhaps I caught them on an offday?

Some interesting feedback from the event from Informa:

The mobile advertising market is due to increase from $2.2bn to $11.4bn by 2011 - though this will still be just 2.1% of the global advertising market. (My note: surely we can be more positive that this; given the unique characteristics of mobile I would bet anyone this share will be significantly higher).

In Q4 2006, 20% of users were frequent content purchases - where frequent is someone that has used the service in the last 90 days (I wish my investors would believe that generous measure) and a further 30% might make a purchase once a year. For me, this would seem to underline that there is not really a standalone market for content purchases and that this is a model to be used to "top-up" revenues made elsewhere.

The feedback on advertising was interesting and worth consideration. I have seen many surveys recently sponsored by players in the mobile advertising space suggesting that 90% of all users would be accepting of mobile advertising if they were to receive something in return. The Informa numbers paint a completely different picture.

Asked: would you support advertising if you received cheaper or free content?

46% disagreed strongly
14% disagreed
21% were indifferent
12% agreed
7% agreed strongly

One has to believe in Informa as an impartial reporter and as a result I found these results to be a real surprise and potentially a little alarming: 60% of users would be against advertising.

Time will tell but this is indicative of the tone of the event which suggested that mobile advertising is not and will not be a reality and that if you can focus on content purchases then you really should as being the sensible money making play of the next two years.

I think this is too aggressive (which is my polite way of saying "hogwash"). I think I'll post the case for the defense of mobile advertising in another post. There was truth in today's figures but I think that there is a misread of the momentum in the industry right now.

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