Nokia pushes content: deal with Telefonica

Nokia is a lot in the headlines (and this blog) these days, but the good folks from Espoo are very busy, it seems. Today, they announced a deal with Telefonica concerning Nokia's content solution. This includes customizing the multimedia menu on Nokia's devices as well as cooperation on billing and some other technology issues. Whilst Ovi, Nokia's new open doors solution to the world of content, was not expressly mentioned, it very much feels like it, and this will be welcome news to Nokia that is said to be slightly miffed over the carriers' recent devotional tour past Apple and the monstrance iPhone; understandably, since Nokia never got a revenue share from carriers in spite of having carried a lot of the weight in developing device capabilities.

This would then be fantastic news for Nokia: finally a mobile network operator that does not throw the NCD off the Nokia devices. Telefonica said, it wants to ensure that customers have access to the best in Internet services. The goal is to drive a "dramatic" increase in user uptake of these new services over the coming years.

The press release mainly focuses on ease of use, easy access, etc, and this is indeed an area of concern for many carriers hindering a larger uptake of mobile content. Nokia natually intends to make sure that any multimedia experience will be best on its own phones rather than competitors' and this, coupled with its respectively designed Ovi service shall further solidify the Finnish giant's lead on the handset market. Carriers on the other hand have continuously struggled to deliver content to consumers in an enticing and exciting way. It became all too often painfully clear that content was not the stuff carriers knew well...

Besides the pretty obvious goals of both parties, it is a noteworthy deal as it may be one step in a shift of the "home of content" from operators/carriers to third parties: D2C has often struggled. On-device-portals were largely marred by carrier reluctance to support them (and often requests to wipe them off the devices), etc. With Nokia moving in, this might change: if this cooperation would indeed result in superior content experience (including the resulting increase in revenue for all parties concerned), this might trigger follow-on deals on both sides: the large OEM will be watching as will be other carrier groups.

Watch this space...

Emotional attachment to mobile content...

Yay, another study is out! This time, we are being told that users have "strong attachment to the content on their devices, which includes address books, ringtones, text, pictures, music, games, and other applications". Ah, it includes the address book and pictures - presumably those primarily taken themselves with the phone's camera. Astonishingly, users reported that losing their phone is far more painful than [...] breaking up with a boyfriend or girlfriend. Hello? Did they only ask specialists in speed-dating? Over half said that losing their phone would cause their social life to suffer. Well, yes, your evenings can be pretty lonely if you don't have any number of any friend anymore...

66% of the users re-enter new addresses manually into new devices. Have they never heard of the software suites delivered with every phone these days that make this a piece of cake?

There is of course some truth in this, such as the grown significance of mobile phones and mobile-created/stored content, and, yes, because people tend not to use the tools readily available, it can be a pain in the neck when you need to swap the beauties. However, much of the findings appear to be slightly distorted by the above mentioned contacts and pictures. 70% of the users find it extremely or very important to back their contacts up. Doh! Why don't they? This already goes down to 30% for photos - and these are arguably as personal. No word on ringtones and games. Whilst I can see people sweating over having lost 450 telephone numbers including the one of the rich auntie, I struggle to see a user weeping because his Tetris highscore is no longer available on his shiny new phone (although then, they just might). This is in spite of the cost of mobile content, which can be significant when you add up content purchases over the lifetime of the device.

Who commissioned the study you're asking? A company called FusionOne. And what does FusionOne do you say? Well, in their own words: "mobile applications that help consumers protect and manage the personal content on their mobile phones, including contacts, calendar, photos, music and messages." There you have it.

Google goes "livestreaming", acquires Jaiku

Now, this is not strictly mobile BUT then it is considering that the target of which I report here today is heavily using mobile as a tool to feed its community, namely SMS (plus web and IM). It morphs online and offline worlds (nicknamed "bothline"; see here), and mobile is a huge component of this.

Anyway, Google, it was announced, has acquired the good folks from Jaiku. For those not that familiar with the radically new web 2.0 applications: Jaiku is a Twitter competitor where you basically "speed-blog" or "live-stream". Jaiku adds proximity settings: users in the same area can/will be able to get in touch with each other and interact.

At PICNIC'07, I recently had the pleasure of listening to Jaiku's co-founder, Jyri Engestrom (plus the good guys from Twitter, Plazes, Dopplr and Hyves), talking about the relevance of applications such as Jaiku. There is a video of the session available here.

It is (still) all about relevance and context. Jyri observed that context evolves around objects (such as office, Manchester United, kite-surfing, babies, red Bordeaux, and, yes, location...). The object defines the (social) context: you might be interested in the capability of webservers in your professional environment and discuss this wholeheartedly with someone else with who you would not have a single point of mutual interest outside of work. Change the object, change the context. Jyri (in his rather interesting blog) calls this object-centered sociality (yes, he is a sociologist).

Jaiku supposedly helps making focus on any object easier as it provides quick and universally accessible tools to see the activity streams of your contacts. The mobile version does this by getting those streams directly into your phone's contacts. Cool stuff.

However, why would Google buy them (apart from it being cool and Google being cash-rich)? Relevance and context, again. These are the core pieces around which Google's core business evolves: put ads in a relevant context and you improve click-through. Jyri characterized this by drawing the history of content discovery from catalogue (Yahoo!) via pagerank (Google) to what he termed "facerank", combining the power of the search algorithms from Google with the power of the social network from Facebook. The latter is e.g. a search result that would take the social context of the, say, search string (the object). Friends, people close to you, colleagues, other fans of your club, etc are more likely to have come across something that is relevant to you than someone who has no touch-point with you whatsoever. You don't have to know them personally: connoisseurs of Bordeaux wines might only have "met" in the virtual world. Still, since the context evolved around a common object (Bordeaux wine), it is more likely that you will hit a relevant spot through them. The higher the socially-enhanced rank of a search result, the more relevant it is likely to be... Compelling and rather inspiring!

So this is what Google may have in mind: bring the context to the people -- again! Well done, guys!

Nokia maps it out, buys Navteq

Nice thing if you can get it: for a modest $8.1 bn ($7.7 bn if you discount the cash the company has in its coffers), Nokia acquired the provider of digital maps, Navteq. Even though this marks Nokia's largest acquisition ever, it is a hardly surprising move given the recent activities of the company to flex its muscles in the content space. Its Nokia Maps application cried out for something like that (it ran on Navteq-supplied maps anyhow). To combine GPS-equipped phones with the people who power loads of todays digital maps seems smart, in particular when one fairly apparent new competitor in Nokia's courtyard runs a fairly successful digital mapping solution itself, namely Google: If the proprietor of Google Maps enters the handset market with the already somewhat fabled GPhone (another article here), Nokia is arming itself to withhold and defend its still impressive market share of c 1/3 of the global market for mobile handsets, errh, multimedia devices. Last year's acquisition of Gate5 seems to not have been enough for that. No other big OEM has come out with GPS-enabled devices with force yet, so Nokia's move would also cement its positions amongst its current peers.

So what will we see? Easy, huh? After turning mobile phones in multimedia computers and slashing away on the digital camera and music player market along the way, navigation systems (or "sat nav" as your ubiquitous salesman affectionately calls it) will apparently be the next victim: who needs them if one has a GPS-equipped Nokia N95 (which, yes, also comes with a digital camera powered by a prestigious Carl Zeiss lense and has 8GB space to accommodate your music and videos).

This is the near-sighted and easy bit and I am all for it: if I can have the quality of specialist devices merged into one, then that is my device of choice even though the challenge is that you then have to beat every leader in the segment. But the history of camera and music phones shows that there is a niche that is rather a gaping cleft, in particular when also cleverly branded, and one that is apparently growing. So why not for sat nav, too?

The magic word however is context-awareness. It can probably be called the holy grail of service and product discovery and the provision of relevant offers: if I am being offered something in a context that makes the offer relevant, I am much more likely to be lured into using/buying it. This is exactly how Google's famed AdSense works (and advertising is an area Nokia recently focussed on, too, i.e. with the acquisition of Enpocket).

The principle of context increasing relevance naturally applies to everything: if I am hungry, I am more likely to visit a restaurant. If I am at an airport, I am more likely to be interested in flight times, or travel offers, etc, etc. So combining a device that adds an important context parameter, namely location with a platform like Nokia's Ovi that adds an array of different services (games, music, maps, etc) looks like a model that should increase the likelihood of a purchase - because it can offer the user a more relevant offering in the context in which he uses the device. Nokia seems to be finding it easier to get its content-loaded multimedia devices past the carriers' doors, too, that is if Graeme Ferguson, ex-Vodafone Content Meister, is to be believed...

However, I will continue to call it a mobile phone...

O2 gets iPhone in UK - good or bad?

"US customer satisfaction is off the charts". These were the words of Steve Jobs on the iPhone, adding he was keen to bring this to UK consumers as well. Now, he would say that, wouldn't he? The lucky (!?) operator to grab it is O2 UK. Why? "We got to pick the carrier that felt most like home, and that's O2", says Mr Jobs.

From 9 November 2007 onwards, the iPhone will be available at a cost of 269 pounds which, converted to c. $540, is substantially more than the comparable price in the US (but then, the UK price includes 17.5% VAT, whilst the US price apparently did not include sales tax). From 35 pounds per month (but tied into an 18-month contract), you get an all-you-can-eat data service that also gives you free access to 7,500 Wi-Fi "the Cloud" hotspots in the UK. This is small consolation for the fact that - rather disappointingly - Apple does not offer a 3G version of the iPhone for the European release but is still running on EDGE; O2 is reported to have been working on upgrading its EDGE network in the UK, which is another addition of cost to what already seems to being a costly deal (since you wouldn't normally have to add this to a 3G-capable network). Also, it looks as if it was not unlimited after all: O2 said that "1,400 internet pages per day would break the deal as part of fair usage agreement." Over Wi-Fi, too? Why?

The remarkable spin abilities of Mr Jobs were again on show when he explained the reason for not adding 3G Here's what he said: "The chipsets work well apart from power. They're real power hogs. Most phones now have battery lives of 2-3 hours and that's due to these very power-hungry 3G chipsets. Our phone has 8 hours of talktime life. That's really important when you start to use the internet and want to use the phone to listen to music. We've got to see the battery lives for 3G get back up into the 5+ hour range. Hopefully we'll see that late next year. Rather than cut the battery life, we've included Wi-Fi and sandwiched 3G between Edge and a more efficient Wi-Fi." So in effect it is better to have 8 hours of battery life because your browsing takes longer than on 3G? Hmmmm...

The one thing everyone is really curious about is whether those recent speculation that O2 offered a whopping 40% revenue share on airtime (AT&T offered 10% USA). Sadly though, nothing has been confirmed to that end although the 10% seem more likely (and it is in itself a continuation of the small revolution Apple triggered with that deal in the US).

And, yes, I want one...

Nokia pockets Enpocket

Nokia has agreed to buy ad-platform provider Enpocket for an undisclosed sum. The deal is expected to close later this year. This, coupled with Nokia's recent announcements concerning Ovi, shows the Finnish giant's push into other parts of the mobile content value chain.

Nokia's CTO Tero Ojanperä highlighted just that: “Nokia has already announced its intention to be a leading company in consumer Internet services and we believe that mobile advertising will be an important element in monetizing those services for our customers and partners. [...] This acquisition is a [...] move to bring the reach and depth of Nokia to organize the market across the world, and make it easier for an ecosystem to develop.”

Nothing much to add, I guess. It'll be interesting if they will manage to leverage Nokia's might to extend the reach of Enpocket or if the latter will simply be absorbed by the sheer size of the former...

Mobile Mesh Networks: now we're talking...

Swedish firm TerraNet is trialling a mobile mesh network, we read. In a mesh network, each handset works like a little base station, too. It is a peer-to-peer technology without the need for a base station and, hence without a network operator or carrier. TerraNet's devices currently have 1km range, i.e. unless there is another device within a range of 1km, it will not work.

However, should this technology become robust and sufficiently scaled, the new Vodafones and Verizons would probably be Ericsson and Nokia Siemens Networks, i.e. the big network vendors. Incidentally, Ericsson is said to have invested $3m in TerraNet. At present, a maximum of 7 hops can be done, and this would be limiting the distance that can be covered. However, the company apparently also offers a network node via a USB dongle and this could then connect to a VoIP system to bridge long-distance and go into another mesh network closer to the recipient.

Would this technology be available on a larger scale (and perhaps ultimately without the constraints of so many hops), this would then result in lower cost for users because there would be one less mouth to be fed in the value chain, and it so happens that this is the hungriest mouth at present. Terranet is said to be recognizing that the telcos won't be delighted about this (multi-media evangelists like Nokia's Anssi Vanjoki will however be uber-excited as it will boost multimedia offerings and the opportunities over there). Oh, dreaming of the future...

At present, the offering is geared to scarcely populated areas (the company runs trials in Tanzania and Ecuador), and the above-described problems might not be an issue there. In the contrary, it could be that operators would embrace the technology to expand coverage. The company also targets urban areas where people make lots of local calls, which would then be virtually free.

In those more urban areas, there may be problems with having enough available frequencies, and the struggle with the regulators in the space might indeed slow the deployment down significantly. This would probably be made even harder due to the political concerns of many countries when it comes to weakening some of their economic powerhouses (because this is what carriers also are).

Other commentators are also concerned with battery life but also note that, if the phones are replacing landlines, they can be left plugged into a power source (which would be defeating the purpose of the notion of being mobile though, I guess). Surely this would be solvable though.

Very interesting indeed, I think!

Sony Ericsson to leverage PSP and Bravia brands?

According to the FT, Sony Ericsson ponders the release of PSP and Bravia (its TV moniker) branded high-end mobile phones, quoting SE's president, Miles Flint. The Bravia-phone is - I was surprised to learn - already a reality, namely as a mobile TV phone with DoCoMo in Japan. Regarding a PSP phone, Flint was cautious, saying that the technology was still some way from being perfected. “We need to make sure that it is a credible phone, and be sure we are justified in putting that identity on it,” he was quoted.

This approach would continue SE's strategy to leverage Sony consumer electronics brands in its phone business, which it has done with the ubiquitous Walkman (now turned video player) and its digital camera brand, Cybershot. This strategy has apparently helped to double its margins - in addition to moving up one spot from #5 to #4 in the leading manufacturers' list.

It seems eminently sensible to try and build on Sony's considerable fame in consumer electronics, in particular as Nokia (most recently with its high-powered and feature-packed N95) and new entrant Apple seem to be pushing the edge of the envelope, and LG adding on the design front (the Prada phone and the LG Shine spring to mind). SE's approach of weaving the trust it enjoys from consumers for its electronic devices into the mobile phone branding may well be suitable to counter this race. However, as was also noted, Mr Flint did not forget to point out the most important thing: “We need to make sure that it is a credible phone, and be sure we are justified in putting that identity on it." There you go!

The statements probably come on the back of reports during the last weeks (e.g. here and here) that SE was to release a games phone with a games-oriented user interface and styling, and comprising - geek excitement levels rising through the roof - things like motion-sensitivity, which will pave the way for Wii-like gameplay on a handset (be aware of flying handsets on your commute then).

Mobile Coupons gaining traction?

Mobile coupons have long been a story lots of people have tried to get their heads around (the oldest blog entry I found dates back to 2003). There is a large number of players working on and with this and there have been the occasional successes: Austrian firm 3United (acquired by VeriSign) sold mobile tickets for a Britney Spears concert in Vienna as early as 2005 and 10% of all tickets sold were sold via mobile (they upsold additional content to 85% of those users!; see here). Scottish company Mobiqa is rolling out a mobile ticketing solution for MLB through tickets.com (see their showcases here). There are countless more applications in the area (apologies for not mentioning everyone...)

Cellfire now reports "about" a million people who have signed up for their service in the US. The WSJ ran an article about this (read it here; note: this might go to behind their subscription wall soon...). Redemption rates are reported to be good: they say they've been seeing them at 15%, which is a whopping 3x that recorded for old-fashioned paper vouchers.

Besides the usual critical mass and all I suppose it comes down to mainly two points then: more information about the line one must not cross in respect of bombarding consumers with advertising and retail brands picking up on the mobile screen as an advertising and indeed customer retention tool in earnest (so far, most of what we are seeing are trials or fashion-driven PR affairs). Given that there are more mobile phones in the world than toothbrushes, this should be a no-brainer! And with customization and segmentation of the customer base increasing by user, a very targeted approach should be possible. This is something Cellfire clearly realizes: they do not share phone numbers... Well done, them.

Twistbox on the money

Twistbox has announced it has raised a healthy $19.5m from ValueAct Capital (rather secretive firm: you require a user name and password even for accessing the "overview" section of their site) and "other strategic investors". It also announced that former Vodafone Global content supremo Graeme Ferguson has joined its board of directors.

Twistbox was the result of the acquisition of German developer Charismatix (authors of e.g. Anno 1701, Taito's Arkanoid, etc) by (predominantly) mobile adult (which they call "late night") content provider Waat Media from LA (who work with the likes of Private and Vivid)After a lot of buzz around them a while ago (and every year again at 3GSM when everyone gets gibberish over their licensees' parties - no, no scantily-clad girls there worth mentioning, ever...), it had gone a bit quiet. The last we heard was a deal they signed with Fashion TV.

Presumably, the new money and director will get them out into the public eye a bit more again. According to the release, they plan to use the funds to launch web-to-mobile storefronts and play-for-prices games. They also want to push into advertising (but then, who doesn't?).

We all suspect there's money in this "late night" content but little has been seen to quantify the opportunity. Juniper said in 2005 it was $1bn. Forbes didn't quantify in 2006. I have seen analysts who put the share of erotic games to 12% of the total mobile gaming sector, ranking them above racing and arcade games (7% and 5% respectively) but that's somewhat unconfirmed. Moreover, video and pics will presumably be even hotter sellers - if and when they get through the varying publishing thresholds in the different countries (from PG13 in the US all the way to "behind-the-curtain" adult content in some European countries. An overview on various attempts to put a number to that market can be found here (courtesy of adult mobile pioneers, Cherrysauce).

As it will in general still be arguably safe to say that sex probably still sells, we might expect Twistbox to go on to further strengths. Just get your parties up a notch, guys... ;-)

Finally, a note to all you dear readers: this post contains links to adult sites. Do NOT click if you are offended by adult content.

Games 2.0: UGG (or user-generated games)

The wonderful guys from French Flash specialists Mobitween launched a user-generated-games portal called ugenGames. Here's the PR blurb: "The site invites players, developers and designers to create, upload, customise and share web and mobile Flash-based games. It also offers the chance to personalise and share games with others players by embedding them into social websites such as Facebook and MySpace or blogs like Blogger and Wordpress."

Mobitween's CEO, Philippe Chassany, reckons that this approach "bridges the gap between web and mobile game developers and players allowing them to create, customise, embed and share an endless library of games".

The concept is intriguing: basic casual game engines that can - because all done in Flash - be easily customized even by amateurs. Moreover: as the creator can adapt screen sizes, you can also choose to have it output in Flash Lite flavour - suitable for higher-end mobile phones! It is a rather sweet accompaniment to the 2.0 revolution.

However, will Flash Lite become J2ME's nemesis and revolutionize mobile gaming? Probably not just yet but the potential would certainly appear to be there: with over 200m enabled devices it is no match to the other technologies around but it is reaching a size where development for it might make a lot of sense: it is faster and cheaper than J2ME or BREW (last but not least because the porting nightmare falls away due to the vector-graphics approach used by Flash). Given that the limitations of input via mobile handsets limit the complexity of game play anyhow, the inherent limitations of Flash might not actually be too much of an impediment. Interesting...

Nokia opens doors (if you read Finnish, that is)

Nokia launched its new Ovi platform to great fanfare. Ovi is apparently Finnish for "doors", which gives a hint on what they intend to do: lots of door-opening to "delivering experiences and services", which now is their business according to CEO Kallasvuo.

There is not too much on tangible details so far. Ovi is supposed to be the door (geddit?) to a bundle of services, namely their new music service, their revived N-Gage gaming brand (now a service and not a device anymore; good New York Times article here) and Nokia Maps. Then, it is said, it shall also "the entry point for other Web and mobile services". Which ones? Dunno...

Nokia is of course perfectly positioned to try and unify a content experience on the fragmented mobile space: its massive market share in most markets around the world allow it to push its platform onto a lot of existing devices. As an attempt of unifying the scattered environment, this is probably as good as it will get in the shorter term, so fingers crossed!

i-mode dropped by O2 UK & Telstra

Today's a busy day, and here comes the next piece: we read that O2 UK will stop selling i-mode handsets from the end of this month, so that the service it licensed from NTT DoCoMo will probably soon come to an end. Elsewhere was reported that Australia's Telstra will close the service in December of this year.

O2 UK spent £10m in marketing which yielded a mere 260,000 users over the past 2 years. Telstra is believed to have gathered less than 60,000 followers of the service. Not impressive and only the last examples of i-mode's failures outside of Japan (and some pockets in Europe, namely with Bouygues in France and O2 in Ireland).

The woes continue as some other markets either pulled the service already or did not even launch it: following the disappointment in the UK and presumably closely monitoring the struggle of E-Plus O2 did not launch it in Germany. MTS Russia generated a mere $150,000 per month from it. In India, the launch on Hutchison Essar was pulled "in part" because Vodafone invested in the company. Exact numbers are hard to come by but as one does not hear booming statements of its overwhelming success, conclusions can probably be drawn...

What is it then that made i-mode such a success in Japan and such a failure nearly elsewhere? Is it the change of the mobile landscape with more and more operators abolishing usage-driven data charges, the general increase in bandwidth on phones which allows users to access more rich content more easily (this used to be an advantage of i-mode), or the lack of support from handset vendors (often cited)? It probably is a bit of everything really but quite possibly the old and overcome model of making money by letting the meter run: users outside of Japan are neither used to this anymore nor do they welcome it. And rightly so: the value is not in the time I spend browsing. The value is in a specific application, service, game, etc. Being charged for this would appear to be eminently sensible: I buy a product and I pay for it. Paying to use the pavement to go to the shop is less convincing as a concept.

Update: The International Tribune has an i-mode article here. It basically confirms the above but offers some additional viewpoints and quotes and such...

Ubisoft sells Gameloft stake

Console game publisher Ubisoft sold its 18.89% stake in leading mobile game publisher Gameloft for € 81.27m (c. $111m) to Calyon, the investment banking unit of French bank Credit Agricole.

The deal is interestingly crafted and seems to have been driven by financial performance concerns for Ubisoft: it is an equity swap agreement that gives Calyon 24 months to sell the Gameloft shares on the market. Any changes in the Gameloft share price will then be recorded by Ubisoft, so the deal will only affect Ubisoft’s income statement when Calyon sells the Gameloft shares. "Ubisoft said the equity swap enables it to stagger the placement of the Gameloft shares so that Ubisoft can keep benefiting from the company’s development potential over the next two years."

No need to get all hyped up though: the Ubisoft brands will remain safely where they are: The two companies said (other sources said "hinted") that they will continue to collaborate, especially when it comes to utilizing Ubisoft’s brands on mobile phones.

The fact that the license ties and collaboration will remain, that it will still be the Guillemot brothers at the helm of both companies and, last but not least, the way the deal mechanics work would suggest that this was more a piece of corporate and financial housekeeping for Ubisoft rather than an aggressive new move for Gameloft. On the other hand, even mighty Gameloft may have felt the need to position itself slightly more independently in order to be able to move in a market that has seen continuous consolidation waves and aggressively pushing market players.

Cellcom's ad-funded game trial: the Results

It is probably because they read here my criticism of their somewhat cryptic information policy back in April (well they probably didn't) but - one way or another - Cellcom, the Israeli carrier that entered into a comprehensive ad-funded mobile game trial has provided insight in the results. Kudos!

So what do we learn? Here's some of the highlights:
* 44% click-through rate
* 19% acquisition rate
* 10x higher game downloads per user (compared to downloads prior to the trial)
* 24% of the participants had not downloaded a game in the preceding 6 months, and 54% had not done so in the preceding 3 months.
* Take-up appears to have been particularly high amongst the youngest (9-20 years). No surprise here. The sentence reporting that is a bit mumbled, so not sure if they want to tell us that 65% of the users in this segment downloaded at least one game during the trial...

A little aside I noticed was that they call advertisers - somewhat carefully - sponsors: does that mean they didn't get any return for their money? Anyway, they advertisers/sponsors included quite a few of the biggies, e.g. Nokia, McDonalds, Diadora, Samsung, Adidas and Walt Disney. All the agency powerhouses tinkered with it, too, with McCann, Saatchi & Saatchi and BBDO all involved.

I have praised above Cellcom's information policy but two crucial data points are (somewhat unsurprisingly) left out, namely CPM and pay-out to the game publishers. For a 1-month trial, everyone will be in for the ride, and be only to show that they are in the midst of the flavour of the month, mobile advertising. However, only if advertisers are that (and not sponsors), i.e. if CPM will be at levels comparable to other media (or better), will it work. The above click-through numbers suggest that this might well be the case, and the added value of extreme targeting (the mobile screen is a user's most personal one: it is not shared with others to the extent the TV or computer is) will improve that further.

The question will then remain if big mobile game publishers who regularly spend hundreds of thousands dollars on a game will provide for in-game ads in these games and if licensors for such games will allow advertising that will then factually be endorsed by their brands. Finally, operators must make sure that the consumer is not charged for the data transferred to feed the ads. This can make for an incredibly complex business model, and perhaps one that will not make it worthwhile for one or more of the parties in it to participate. Much easier of course if there is no third-party licensor involved. The result could then likely be a two-fold structure: high-powered branded premium games for a price and unbranded, ad-funded games for free.