Advertising key to putting Internet in every cellphone

Advertising key to putting Internet in every cellphone


© 2006
AFP
November 16, 2007 – 10:50PM

The emergence of "smartphones" has put the Internet, music and
videos in the palm of the consumer’s hand, but the technology will need
a flow of advertising cash to reach its full potential.

Cellphone
makers and service providers meeting at the Mobile Internet World
conference here picture a world five years from now where the consumers
will be able to pay bills, read the news and communicate with their
mobile devices.

Few cellphone owners are currently
using their devices to access the Internet — nine percent, according
to the Yankee Group, a technology consulting firm.

But
the IDC research firm says that more than one in five cellphones sold
in 2011 will be "smartphones," devices with Internet access that can
also play videos and music.

Three billion
cellphones circulate in the world, three times more than computers.
While Internet connection over the cellphone is often slow, it is
improving.


According to Kiyo Oishi, chief of the
Japanese firm Access, one billion consumers will have access to
high-speed Internet in 2013.

Consumers will need better services, including simpler websites and systems that are not limited to one operator or device.

But the market will need revenue.

"Advertising, commerce will be the economic engine that will drive everything," said Andrew Belt of the Monitor Group.

Currently
operators make money through subscriptions to their services. For
instance, some companies charge for email service, ringtone downloads
or voting on television game shows.

But to get a
slice of the mobile Internet age, companies will have to rely on
advertising to get their products to consumers, analysts say.

"You
have 110 billion US dollars spent on TV (advertising). By 2008 you’ll
see big shifts, to mobile and social networks," said W2 Group chief
executive Larry Weber.

According to the firm
eMarketer, 16 billion US dollars will be spent on advertising on
cellphones in 2011, 10 times more than today.

"Most
people would rather have free services with ads than paying
subscriptions," said Andy Jedynak, co-chairman of the Interactive
Advertising Bureau’s (IAB) mobile committee.

Advertising will become the main source of revenue for mobile devices, but not before three to five years, he said.

IAB,
which represents companies that sell interactive advertising, already
wants to set standards for cellphone ads, including to limit their size
to no more than a quarter the screen.

"All
mass-media are financed by advertising," said Douglas Edwards, founder
Handmark. "Advertising will inevitably" become the main source of
revenue, he said.

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