Orange has chosen music as the content for this launch, and music is undoubtedly very popular among mobile subscribers in the UK. A recent M:Metrics report indicated that 46% of UK subscribers own a music enabled device, but music is not the only digital content proving popular with consumers. As usage of other types of mobile content (including TV and video, gaming and social networking) grows, so does the potential for ad-funded propositions.

Following Orange’s announcement, 3 UK has now also joined the party, announcing shortly after Orange that it intends to trial an ad-supported mobile music video service of its own. Further afield, Vodafone Italia recently launched a trial of ad-funded mobile video service at the turn of the year; so, with different types of digital content coming in to the mix it looks as if we will begin to see what works and what does not.

Learning Curve

Opinion is divided in the industry as to whether mobile advertising can provide the rich revenue streams for which many operators appear to be turning to it. In addition questions are being asked with regard to how advertising will best work for consumers, operators and advertisers, taking into account factors like types of advertising, length of adverts and where best to position adverts to maximise viewership without intruding on customers personal space.

According to a recent Gartner report, worldwide mobile advertising revenues are set to surpass $2.7bn in 2008 - a $1bn increase on 2007. However, it is noted that the market has developed slowly and still has some way to go along the advertising learning process. In order to encourage users to accept advertisements, brands and operators must improve the way they are managed on devices so that the experience is painless and rewarding to end users.

The future’s bright, but is it ad-funded?

Subscribers have in the past cited high cost as the primary prohibitor to value-added services; a recent survey conducted for QuickPlay showed that 43% of users felt that costs are the number one reason they have not tried services including mobile TV and video. However, the introduction of ad-funded content adds a new dimension to this, with 54% saying that they would be willing to watch a short, targeted advertisement on their mobile device to have free access to content.

Orange, 3 and Vodafone’s efforts to trial ad-funded content, gauging just how much their subscribers most want to consume such services before a mass-market roll out, will help to determine the most effective ways to run successful mobile advertising strategies. However, it is important to realise that success for advertisers lies in making adverts both relevant and targeted to consumers, and in being able to provide advertising brands with accurate and timely reports that enable them to evaluate the effectiveness of their campaigns.

With this in mind, it is important for operators to deploy technology that can track and measure how adverts are being digested - not only to build robust and fair pricing models, but also to encourage content providers to mobilise more video clips. Such technology needs to accommodate the needs of both the advert/content creators and the delivery managers (operators) to help them converge in the mobile video space, and stimulate the success of the sector.

Our experience has shown consumers are absolutely willing to receive adverts if they are relevant (and short!) in exchange for free content, and as the most personal communication tool out there, there is no question that the mobile has real potential when it comes to advertising.