Mobile firms seeing ads coming to handsets

Wednesday, 8 December 2010 00:01 - - {{hitsCtrl.values.hits}}

Paris (Reuters): The long awaited uptake of the potentially lucrative mobile advertising market by advertisers and consumers has actually started to happen, companies from Canada, Egypt and Poland said last week.

Advertisers have great hopes for the cell phone market due to the personal nature of phones and the potential to know where customers are at any time, but have been held back by the small screen size and potential hostility from customers.

The sector got a major boost from Google’s deal to buy mobile ad firm AdMob late in 2009, and Apple’s acquisition of Quattro Wireless.

“Across our markets we are getting this fall messages from advertisers that for 2011 they have created separate mobile budgets,” Andrew Osis, chief executive of Calgary, Canada based Poynt, told Reuters in an interview.

Poynt’s local search application for smart phones has 4.5 million active users in North America and Europe.

Osis said the total sums were still small when compared with the online advertising market, but the growth in demand was clear.

The U.S. mobile advertising market is expected to grow to $5 billion (£3.2 billion) by 2015 from $800 million this year, said mobile ad network Smaato in a whitepaper quoting research from mobilesquared. Steven Nathasingh, Director of Research firmVaxa Inc, said mobile devices’ limited functionality has hampered growth on mobile advertising revenues so far.

“The newer phones and tablets will change that as the technology rapidly advances and lower prices drive higher adoption. Mobile advertising is at the beginning of an inflexion point,” he said.

Egyptian operator Mobinil said this week more than 200,000 of its clients have signed up for its mobile advertising service offering promotions, content and discounts, with advertisers so far including Adidas and Nokia.

“The advertisers in the service have had phenomenal response rates to their campaigns - as high as 35 percent due to the focus on the users’ interests, so our customers only receive relevant ads,” Mobinil’s CEO Hassan Kabbani said in a statement.

Telecom services provider Effortel said its ad-funded data service it launched a week ago for Polish operator InMobile has seen faster takeup than its two previous services in Poland.

The new service – first of its kind in the world – gives users free access to social networking sites and data services in exchange for watching advertisements on their phones.

So far it is marketed only on Facebook, where the service has 14,000 users after two weeks.

“It’s our third service in Poland. So far it’s the best, the growth is the fastest,” said Liudvikas Andriulis, Effortel’s Chief Marketing Officer.

So far, Finnish firm Blyk has offered ad-funded calls and texts to consumers in Britain, the Netherlands, and it launched a service together with Aircel in India last month.