Professional Documents
Culture Documents
awake from its slumber and revolutionise the way the consumer receives advertising. With
over half the world’s population owning a mobile phone, its potential as an advertising
accompanied by press releases and industry contact from the past 18 months, this paper
explores the challenges that face the industry as it attempts to become the world’s first
personalised mass media, and how the various stakeholders can work together to launch
this potential £multi-billion advertising solution. The conclusion recognises that advertiser
attitudes, technological developments and available content all need to be reassessed if the
issue that can be overcome by establishing trust. This trust can be created using permission
based or incentives based advertising. The conclusion declares that if the industry works
together towards the common goal of overcoming these obstacles, then mobile advertising
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Acknowledgements
This research would not have been possible without the support of my father, and mentor,
A special mention must also go to Clare Chambers for offering her time, support and
contacts from the industry for the successful development of this research.
Thanks to Mik Parsons and the various members of Bournemouth University Staff who
provided me with new angles, great contacts and superb research facility.
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Contents
3.3.2 Case Study – Greystripe changes the Games Downloads Model ………………28
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3.4.2 Forms of Mobile Advertising …………………………………………...31
Bibliography ………………………………………………………………………...42
Appendices …………………………………………………………………………..46
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What are the challenges that face mobile advertising in the United
producing advertising campaigns that not only satisfy the client’s criteria, but fulfil the
authorities such as the ASA for a broad range of reasons; everything from deceiving the
consumer, to intruding a consumer’s personal space, however the agencies quest to satisfy
the consumer remains the definitive goal. One criticism directed at larger, established
brands is that they employ the same advertising technique to target a broad demographic.
The brand attempts to impose the ideals of one group of consumers upon another entirely
different group, simply to save the brand cashing out on multiple campaigns to suit its
different target audiences. The modern day consumer however craves personalisation and
impact upon them as an individual in order to motivate a purchase or use of the product.
For big brands such as Coca Cola, Ford and McDonalds, advertising budgets are used to
increase brand awareness. Campaigns can include solutions that re-enforce the brands
morals, or simply get people talking. Cadburys produced a fine example of brand awareness
marketing in 2007 when it released its advertisement ‘Gorilla’. The advertisement featured
what was believed to be just a normal Gorilla, however as the advert progresses, the Gorilla
shows some human characteristics before finally breaking out into playing the drums.
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“Gorilla, which broke last September, was one of the iconic ads of 2007, and whilst it was
on air, weekly sales of Dairy Milk increased by 9 per cent” (Dutta 2008). “There was even a
happy spin-off for Phil Collins. After the launch of the commercial which featured his 1981
single ‘In The Air Tonight’, the hit reached no 9 in the UK download chart” (Smithers
2007).
For the smaller businesses however, much of their advertising budget is spent on
Because of a potentially limited consumer base, restricted due to its niche product range or
dependence on local consumers, these businesses are inclined to utilise advertising that they
can measure. None of these campaign styles however has the ability to relate to the
consumer on a personal level. Internet advertising is one of the current front running
advertising methods, and campaigns are often personalised to a degree, however limitations
posed by privacy issues on the World Wide Web means advertisers are restricted to what
advertising channels , with TV budgets under pressure partly driven by the ability for
consumers to ‘opt-out’ of the commercial breaks using new recording technologies, and
partly driven by the worldwide web. Press and radio advertising is also in rapid decline and
revolutionise the way consumers receive and respond to advertising. The mobile phone has
been transformed from a simple communication device into, in many cases, small handheld
computers. Steve Ballmer, the Head of Microsoft’s Mobile division, believes that the mobile
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phone “has usurped the power of the computer as the ‘remote control of our lives’, with
people substituting power for portability” (Ballmer 2007cited Fried 2007). Ballmer believes
that the mobile manufacturing industry will want “to create universal devices that anyone
in the world can use for personal and business use, empowering individuals with optimum
messaging, gaming and office abilities” (Ballmer 2007 cited Fried 2007). With the mobile
phone developing in such a fashion, it is only a matter of time before brands accelerate their
plans to exploit its potential as a serious advertising media. The future potential of mobile
technology, advertisers attitudes – both agency and client side, the availability of effective
content, and consumers behaviour towards mobile advertising means that radical changes
are required if it is to achieve credibility as an advertising channel and the ability to develop
of the topic, this research proposes to present an insight into the current state of the mobile
advertising market, before analysing what is required to develop a future for the industry,
then finally presenting potential developments that will shape the future of mobile
1. What are the current challenges that face mobile advertising in the
United Kingdom?
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2. What technological developments have impacted upon current
3. Who are the key players within the industry, and to what extent do they
4. What are the plans made to develop the content and measurement
The ultimate aim will be to determine how manufacturers, advertising agencies and
advertising brands can work together to create advertising platforms that can establish new
customers, whilst maintaining brand loyalty, and yet still provide the modern consumer
This investigation will be based upon research contracted from the four sectors of
Consumer information will be gathered from a range of reliable sources that accurately
reflect the specific markets in question. This will include quantitative research gathered
from a series of web based surveys and face to face questionnaires, to give a statistical
analysis and a direct yet structured insight into the views of the modern day consumer. This
1
Manufacturers will entail handset manufacturers, network operators and mobile phone accessories
manufacturers for the purpose of this investigation
2
Advertising agencies will often be addressed as ‘advertisers’ for the purpose of this investigation
3
Advertising brands will often be addressed as ‘brands’ or ‘clients’ through this investigation, in order to
discern a difference between themselves and advertising agencies
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is a fundamental requirement as part of this research, because although there are many
examples of accessible quantitative research, many are based outside of the UK and would
demographic.
Manufacturer’s plans will sourced from a scope of press releases covering the past 18
months, and will be further supported through bespoke research, which will comprise of
interviews are a vital part of the primary research, as they provide a direct insight into the
derived. Facts, figures, trends and insights gathered from advertisers and brands that use
mobile advertising will be assembled from a series of journals and reports and will be
The United Kingdom is currently at the forefront of mobile usage, and therefore is
the specific region that will be addressed throughout. This document will address case
studies that involve UK based sectors of the industry, whilst also examining data from
abroad, in regions such as the US and China. By examining information from outside of
the UK, the strengths and weaknesses of mobile marketing in different cultures will become
clear, and therefore create an understanding of the most appropriate way to deploy mobile
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1.2.3 Trustworthiness of the data
The broad range of material collated for this research comes from a variety of
sources, and although whilst every effort has been made to cross check and validate these
findings, the accuracy of some of the material cannot be guaranteed. The majority of
opinions formed within this research will however, be taken directly from a source (primary
research e.g. interviews), which will provide credibility and dependability to the
information. However, many of the interviews with key figures have been collected from
specialist websites that are in direct connection with the industry, and although the
reliability of these sites may be questioned, the reputation of such sites provides sufficient
backing for the information to be trusted. The final conclusion shall be drawn by myself,
the author, and will be derived from all the data and information collected.
Advertising is a thriving and fast paced industry, with durable goods, non durable
goods and service industries all relying on it to promote and market their product. Research
firm Informa Telecoms and Media states that “a total of $450 billion is spent on advertising
in total worldwide” (Anon(a) 2007). This figure is based upon the four main traditional
pillars of advertising; TV, radio, print and billboard. However, “$24 billion of this figure is
based around the latest advertising trend; Internet advertising” (Anon(a) 2007). “Overall
UK media spend increased 4% in the year to March 31 2007 thanks to strong growth in
press, direct media and internet display advertising budgets” (Sandison 2007). Internet
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display advertising grew by 9% according to reports by Thomson Intermedia in its March 07
Media spend estimates. According to the researcher, the “12 months to March 31 2007
show an ‘expected’ slowdown on the dramatic growth seen across 2005 and 2006 as the
internet grew up as a media” (Sandison 2007). Market observers are forecasting “total
internet ad spend growth of around 25% year on year” (Sandison 2007). Use of standard
display formats is still growing but, increasingly, “brand advertisers expect more engaging
ways of holding a dialogue with consumers” (Sandison 2007) and although internet
advertising offers media rich, interactive content, it is weak in comparison to the potential
for mobile advertising, which, as a media, can target consumers at any point during their
Advertising has begun to establish itself in every possible scenario in which it can be
noticed, with agencies beginning to specialise in specific advertising forms. This is part of
the advertising industries quest to uncover the next big thing with many new advertising
methods addressing even the most niche markets. “The rising popularity of online gaming
has been mirrored by a surge in in-game advertising. With gamers around the world pitting
their wits against each other online, it is now possible for ads to be tailored to individuals”
(Murphy 2008). The speed and quality provided by next generation games consoles such as
the Playstation 3 has opened up online gaming to the masses, making it easier and safer
than ever to battle it out in multi-player games. With this broadening range of users now
taking up online gaming, advertisers have wasted little time in experimenting with ways in
which to personally target these consumers. “While football videogames have long featured
ads on billboards around the perimeter of the pitch, now targeted ads can be served. These
can be tailored by a user's geographic location and demographic profile, offering advertisers
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Advertising is no longer built upon the foundation of TV, press, radio and
billboard. The opportunity created by the internet and the potential of the mobile medium
means that advertisers are now exploring the ways in which to create campaigns that
Mobile phones have become an integral part of the human way of life for the past
20 years and can only become more important in the future. The number of people with
mobile phones in Europe is a substantial percentage of the population of the region, and
many of those with mobile phones also have digital TV and broadband Internet. The take
up growth between 2000 and 2004 in Europe was 154.6% (Boretos, 2005), with mobile
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phones becoming more accessible to those with lower incomes, as well as being made easier
to use by those unfamiliar with technology. As the number of user accounts in Europe is
now optimised, the growth in numbers has begun to slowly decrease, before eventually
levelling out, as everyone but the very young (under 13) and the very old (over 70) will
have a mobile account. Despite this growth pattern, the desire for the latest gadgetry and
technology means that consumers will always want a new handset, with most operators
offering upgrades every 12 months. The latest mobiles bring with them new ways of
communicating, playing games and surfing the web, which in turn, has provided advertisers
The Nokia N95 (Fig.1) and the Apple iPhone (Fig.2) were both launched in the
United Kingdom in 2007. These highly anticipated technological advances excelled the
potential of mobile phones by including an array of technology that had previously only
been used in personal computers. The Nokia N95 was launched in March 2007 and its
launching advertising campaign ran with the tagline ‘what computers have become’.
Despite early problems with the phones system memory, it still proved immensely
successful, with over 1 million units being sold in 2007. However, the greatest hype was
generated by the arrival of Apple’s first ever phone, the iPhone. Its touch screen capabilities,
accelerometer technology 4 , proximity sensor in the ear piece 5 and its desirable appearance
appealed to a broad audience, whereas it’s potential as a mobile phone and computer
appealed to businessmen and women everywhere. In the end, it was “the i-factor - that
Apple design flair and sheer usability which made the iPod such a big hit” (Cellan-Jones
2007) that made the iPhone the must have gadget of 2007. Despite issues with its cost and
4
which allows the content to adjust to portrait or landscape, dependent upon how you hold the phone
5
which turns off the screen light during a phone call to save power as well as preventing accidental touches of
the screen when close to the users face
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network charges, the take up rate was astonishing, with around 250,000 units sold in its
first 3 months.
Both the iPhone and N95 possess WLAN and GPS capabilities, which enables
advertisers to target the owners in a whole new fashion, but despite this, advertisers are still
sticking with the tried and tested methods of mobile advertising, such as MMS and SMS
messages, and text banners on WAP mobile websites. Examples of such current mobile
marketing techniques are easy to find and although not suited for everything, when used
appropriately they can be very successful. For example, “it (mobile advertising) works well
for awareness and branding. Around Christmas time 2006, AKQA created a very effective
campaign for Coke called “The Greatest Gift is Giving”. It only ran on the 3UK portal for
12 hours, but over 120,000 people sent branded Coca-Cola Christmas cards to their
friends. That is certainly brand-building” (Rosen 2007). Other examples of simple mobile
marketing campaigns include text-to-win, which despite being relatively basic, still achieve
huge numbers of response. “In the UK, consumer expenditure on SMS direct marketing
reached 58 million messages per day in 2004” (Trappey and Woodside, 2005). On a basic
level, mobile advertising has had some proven (albeit limited) success, however for the
industry to truly ignite, there are challenges that must be addressed and overcome.
New methods will challenge the traditional ways in which consumers receive advertising,
and are likely to receive a mixed response. Ultimately, the success of the mobile advertising
industry relies upon the consumer accepting and appreciating advertising as part of their
standard media consumption day. This means that manufacturers and advertisers will be
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required to work together to create solutions that the consumer will be willing to accept,
2.2.1 Insight
The modern consumer has become incredibly high maintenance, and is demanding
greater benefits from the products they buy and services they use. For brands and
advertisers, meeting these demands requires time and effort spent on market research and
consumer profiling. Every consumer is different, and although a large proportion may
respond positively to one campaign, a section of this number may also respond negatively
to another. Mobile advertising has the power to connect individual consumers and their
interests, but this requires a greater understanding of the way the consumer thinks. A
consumer’s attitude towards receiving advertising, and their behaviour after receiving it, can
provide a strong indication of the way the proposed market will react to different
consumer, and their attitudes towards mobile advertising, this research is supported by a
survey of 100 people, who all completed an online survey in direct relation to the subject
topic.
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2.2.2 Analysis
Although some earlier literature reported positive attitudes toward advertising, most
of the more recent researchers have found that consumers generally have negative attitudes
toward advertising in general. A survey carried out by Mehta (2000) found that ‘while 45%
of the respondents felt advertising kept them up-to-date about products and services in the
marketplace, 40% of respondents also believed products did not perform as well as
37% also felt much of advertising is annoying and more manipulative than informative’
(Fig3). This research addresses the direct form of advertising, often known as the ‘push’
technique, which is considered to be invasive; and in these results, consumers will have
been receiving advertising for products and services that neither want nor recognise.
According to Mullman (2006), “as many as 81 percent of 18- to 21-year-olds have mobile
phones, and most of them are likely to participate in TV or radio polls, purchase ring tones,
play games, and send text messages”. Although not obvious, these are all subliminal
promote a brand name. Consumers, without actually realising, are opting in to receive or
benefit from advertising, they are more than likely to be prepared to opt in to receive
advertising more freely. This view is supported by a study that was carried out by Tsang,
Ho and Liang (2004), which concluded that consumer “attitudes were favourable if
advertisements were sent with permission. This implies that permission-based advertising
may become a major mechanism in the mobile environment in the future”. In the bespoke
6
Downloading content such as ringtones or games for their mobile handset, to improve its functionality
or suit it to their tastes
7
Participating in a vote as part of a reality TV show to make them feel an active viewer or participant
- 16 -
survey (see Appendix 1) conducted as part of this research, 73% of people indicated that
the main motivation for purchasing a particular mobile was not for the latest gadgetry
(10%), ease of use (11%) or a distinguishing factor in relation to the handset itself, but for
the cheap calls and texts package that accompanied it. The opportunity to engage the
consumer by exchanging advertising for free calls or minutes is available, and 41% of
people indicated that they would be willing to opt in to such a service. The consumer will
always seek to benefit themselves and enhance the service they receive, so attempting to
According to the survey (see Appendix 1), the majority 36% of people are not
advert that can entertain can often be more successful than that which informs. As well as
boosting sales, the advertisement spawned an array of groups on social networking site
Facebook, with well over 9000 members between them, as well as “receiving over 500,000
hits on YouTube the week after it was released” (Sandison 2007). This could provide the
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key to the success of mobile advertising, by embracing the notion that customers need to be
drawn in first, before following up or telling them more about the product. In fact, the
survey (See Appendix 1) showed that 23% of people saw advertising in general as a great
way to learn about new brands. In light of this, launching a brand or product by using
to establish an initial interest. The survey also showed that 66% of people actually read
adverts that they received on their mobile phone, with just over 75% of this figure deleting
the advert after they have received it. It also indicated that 34% of people deleted the
advertisement without even reading it. The findings of this survey demonstrate that
using the ‘push’ method is proving to only put consumers off mobile advertising, with the
survey indicating that 29% of people would rather receive no advertising on their mobile as
they see it as a personal device. The consumer plays a very important role in the mobile
advertising industry, as all sectors of the industry are influenced by what the consumer
thinks, wants and does. One of the major challenges that the industry faces is to overcome
the negative attitude towards mobile advertising by consumers, and to create effective
business plans and methods that can help overcome this. The consumer’s attitude is just
one of several challenges that face the mobile advertising industry, and by identifying the
impact these challenges have, the industry can prepare to overcome them.
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3.1 Developing Mobile Advertising – Technology
The technology installed on, or used to power mobile handsets is vitally important
for the development and maintenance of the mobile infrastructure. “Many of the features
offered by phones such as Internet/WAP, watching live TV and email have yet to take off.
Current limitations in the ability to surf the Web or view live programmes may well explain
the current lack of interest, although this is expected to change as new technology and price
plans roll out” (Anon(b) 2007). Despite having access to the technology, many consumers
are not actively utilising them. For example, in a survey conducted by TGI and Mintel
(Fig4), 68% of people’s mobile handsets had gaming capabilities, however only 23% of
people actually used the facility (Anon(b) 2007). 3G is the current standard of network that
powers the communication and facilities built in to many mobile phones, and although
sufficing at present, the wide area cell-based infrastructure of 3G works with a smaller
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bandwidth, and simply won’t be able to power applications, software and multimedia based
4G networks are the wireless communication networks that many research and
development labs believe will replace 3G (Anon(c). 2003), although there is no clear
evidence to suggest when. There is now a requirement for hybrid networks that employ
both WLAN and cell-base wide area network design, in order to optimise the availability of
the two. Although not completely defined as of yet, 4G will embrace high data rates and
the ability to interoperate between networks. Currently, 3G works with around 5-20 MHz,
WLAN technology to employ VoIP technology, 4G will work at 100 MHz, or maybe
more, running speeds of up to 100 Mbps (Anon(c). 2003). Samsung, as part of the
development of its future mobile platforms, is using the 4G convergence vision. Samsung
intends to establish:
“the combined use of network access technologies like GSM, UMTS, WLAN and
WiMAX that offers users full and seamless area coverage and supply of transmission services
to satisfy the users needs. The respective network access can be selected dynamically and
with consideration of the price and the required band width. In case the connection to a
specific kind of network gets cut, it will be re-established seamlessly through another
With this vision in development, the potential for future handset technology can
expand and create new avenues to not only satisfy the consumer, but create opportunities
for mobile advertising. It is vital that advertisers and manufacturers embrace this new
network technology in order to drive content rich, high quality advertising to include short
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videos and TV style commercials, high resolution images, interactive games, PDFs and web
Nokia is one such company that is bound to support the pioneering vision of 4G,
seeing as it has always been at the very forefront of mobile development. For example, they
produced the first mobile phone capable of video capture, in the form of the 3650 8
(Fig.5a), which, alongside 3G, led to the mobile video call. Their work is no different in
the present day, as it works with not only developers and network operators, but with the
consumer to develop the next generation of mobile handset. Nokia re-launched its Beta
Labs website in October 2007, allowing consumers to test applications and software, and
also submit their own ideas for how the future of mobile should be shaped. Tero Ojanperä,
Nokia's chief technology officer, believes that by grasping a mixture of mobile enthusiasts as
8
Or later, the 3660 was released, due to the issues many consumers had with the 3650 keypad (Fig.5b)
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well as the lower level users, they are able to develop the handsets that will fulfil the desires
"Beta Labs shares some of the exciting new ideas that Nokia is working on and
allows users to help shape their future development, a strong online community has
developed around Beta Labs, especially attracting technology savvy, early adopter mobile
This user testing, accompanied by the work of the Research and Development
(R&D) labs, allows large manufacturers to begin to plan ways to improve handsets, as well
as meet consumer’s needs. They are then able to work alongside concept designers to
actually see if such technology can be produced. As a result of Beta Lab feedback and R&D
work, an artist has been able to conceptualise the Nokia 888 (Fig6), which features a
flexible touch screen which will allow it to adapt according to user taste and to facilitate
extended functionality, which could include GPS positioning technology. These ‘concepts’
may not even be produced by manufacturers; however they give the consumer an insight
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Although many concepts demonstrate super slim phones made out of lightweight
flexible materials, the most recently reality is that phones have been getting substantially
smaller. Whether this size is in relation to its width, length or depth, these phones were,
until recently, the most desirable models. However, the past 3 years has shown a change in
phones. With smaller handsets comes smaller screens; an issue that has plagued the plans of
advertisers and games developers alike. Clare Chambers is part of a development team
assembled by Vodafone; put in charge of creating a financial education game for 13-15 year
olds to incorporate into the national curriculum in schools. Such a project created many
“With Vodafone, it was discussed which mobiles were to be used to test the M-game
on, and the final decision was to use the Nokia N95, because not only does it have Flash
Lite 2 on it, it also boasts a decent size screen… in order to not only see features of the
game, but for the game to have a substantial emotional impact upon the user. It must be
equal to the screen size of the iPhone and handheld consoles” (Chambers 2008, Appendix
2).
“The typical display screens on mobile devices used to be quite small, occasionally
monochromatic, and, in some cases, text-only; hardly the ideal venue for delivering
compelling advertising” (Mathieson 2005). Nowadays however, screens are high resolution,
with the potential to host high quality pictures, animations and video. With the desire to
enhance this quality even further, and allow users to experience the highest potential quality
content, “mobile phones will probably get bigger, whereas the recent trend has for them to
become smaller” (Chambers 2008). This increase in size of the mobile phone will be driven
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by the requirement for a larger screen size, to accommodate the high quality content that
Technology, without a doubt, will play a significant role in the future of mobile
advertising. With operators controlling the 4G vision, for mobile advertising’s future
success, it is important that handset manufacturers and advertisers begin to plan the ways in
which they will utilise the increased download speeds and increased bandwidth, to create
advertisements that will have a genuine impact upon the consumer. In return, it is vital that
the handset manufacturers adjust their development strategy to produce phones that
provide a suitable sized screen, as well as technology that can be supported by the
developing 4G networks.
Despite a hoard of positive press relating to what is dubbed ‘the next big thing’,
there are still industry leaders who are cautious of jumping onto the mobile marketing
bandwagon. Scott Berg, Hewlett-Packards Worldwide media director, has revealed he “is
frustrated by the limitations of mobile-web advertising; marketers who push out ads rather
than allowing users to opt in” (Berg 2007). Advertisers attitudes towards mobile is an issue
that is restricting the growth of the industry, but does not necessarily mean this cannot be
overcome. Nigel Sheldon of Starcom Digital characterises the mobile market as nascent and
intangible. “Nascent because in fact, the mobile advertising industry is just beginning to
emerge. And intangible because most brands and agencies don’t have even a base-level
understanding or feeling for it yet. They understand TV, the internet and even outdoor,
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but they don’t yet have a fundamental grasp of what mobile is or could be” (2007). The
mobile advertising industry is still such a very young market that is growing quicker than
the talent base 9 , however in the next few years, this will begin to inundate with graduates
From an advertising agencies view however, there are distinctive aspects of the
current mobile industry that is holding them back. Richard Wheaton MD of Neo@Ogilvy
is, like many other agencies, excited about the potential for mobile advertising. However,
he believes that as the industry is so young, there is little consumer information available to
“In the TV or on line space, services like Nielsen and Comscore are available. In the
online world, if an agency needs to learn more about what sites men 30 to 40 years of age
view, planning tools provide the top 100 sites. To discover the best mobile sites for that
This is hardly satisfactory for today’s digital agencies to have to conduct research in
such a fashion, and not the robust research expected by today’s demanding brand clients. It
is understandable that agencies are cautious about using and recommending the latest and
brightest technology, if they themselves are unsure of what target demographic use, or even
have access to the technology. This is why, only the most basic and proven mobile
advertising strategies are being suggested by agencies to clients, because until proof of
9
The graduates and technical staff who are training to work and develop the industry
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success, or an availability of data about their targeted consumers becomes available, most
In many cases however, advertising agencies attitudes are based upon the ambitions
and attitudes of their clients. There are believed to be three different kinds of client, and
the way they impact upon an agencies attitude towards advertising in general:
of the audience they are trying reach. Typically these brands are targeting the young
adult audience, and this audience is very difficult to reach with traditional methods
today. These might be brands like Nike, Apple, and some of the major alcohol
brands.
2) Clients that are in the “test and learn” mode. They want to be ahead of
the curve, and want to learn to leverage some of these new media and technology
platforms.
to shift mindsets and consumer perception – for example a lot of the technology
brands that want to be perceived as cutting edge and break through the clutter
(Mandel 2008)
With brands all adopting different attitudes towards different advertising, agencies
are required to adjust to suit the needs of different clients, rather than offer the latest and
most suitable service. Many brands will be unwilling to risk their advertising budget on
unproven techniques, which proves a challenge for advertisers to overcome. For example,
“if an agency can create a mobile campaign but only reach 20% of the audience, most
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brands won’t buy into it. Or if an agency offers a ring-tone download program, but can
only get a 60% successful download rate, clients will still be inclined to use traditional
channels where they can get virtually 100%” (Mandel 2008). On the other hand, some
brands are recognising that with the technology being made available to them, they are able
to target their consumers through a device which in many cases, never leaves its user’s side.
Response rates to a mobile campaign will be affected by the accuracy of the consumer
profiling combined with appropriate and effective techniques used. Against this
background, the work ethic and attitude of an advertising agency is incredibly important to
Mandel (2008) believes that there are two kinds of agency, and the ways in which
they approach mobile force their campaigns to suffer. Traditional agencies that use mobile
advertising the same as they would traditional advertising methods and therefore, they are
not really using it creatively and to the best of its capabilities. Alongside this type of agency
are the mobile only agencies. “They are generally more creative and actually understand
what you can do with mobile marketing but what they often lack is the understanding of
the brand and the marketing objectives, and how to link an interesting creative mobile
program to the marketing objectives” (Mandel 2008). With this in mind, it is clear that
whatever the agency, it is important for them to not only embrace traditional theory, but to
also use the latest techniques in an appropriate and applicable fashion. Without creating
this balance, many mobile advertising campaigns will prove to be a waste of the brand’s
budget.
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3.3 Developing Mobile Advertising – Content
For many consumers, one of the main attractions of any media source is its content.
The internet, for example, is used for a broad range of purposes, all which can be addressed
using Katz and Blumler ‘Uses and Gratifications’ theory. These include Surveillance 10 ,
diversion 11 , personal identification 12 and personal relationships 13 . All of these uses and
gratifications can be applied to mobile media and content. By fulfilling at least one, even all
of these sectors, content providers for mobile can establish an audience of consumers who
Of all the uses and gratifications, entertainment is probably the most applicable to
the mobile market today. It is available on almost any media platform in modern society,
with a range of basic, even interactive TV shows, alongside games websites, console gaming
and much more. However, the significant challenge for content providers is to entertain
such as travelling on the train, sat in a café on their lunch break, even whilst they are at
work. The handheld console industry has taken a significant step towards filling this void
10
Surveillance includes all material and media used for gathering information. This can include
everything from listening to your local news on the radio, to finding your quickest route on a website.
11
Diversion is the term used in relation to entertainment, which can be anything from listening to your
favourite radio show, to watching video clips on YouTube.
12
Personal Identification involves all media that allows the user to personally relate to it. This can often
be Readers letters in a magazine, or a fitness regime for injured sportsmen on a website.
13
Personal relationships is identified as all media which can provide the user with the ability to discuss
with other media users. The most common use of this is with TV soap shows providing users the
opportunity to discuss story lines.
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by creating small yet powerful consoles with a wide variety of games available to a broad age
range. The main problem here is that these consoles are not ‘slip in your pocket’ size, and
are in fact extra luggage to carry around with you. Gaming on mobile phones therefore, has
the potential nose ahead in the race for the consumer’s entertainment gratification. The
mobile games download industry has proved immensely successful all over the world, with
“17 million consumers downloading games in the USA in 2006” (Mitchell 2007). By
providing the consumer with a vast selection of games, providers are able to supply to even
the most niche markets. Advertising in connection with games downloads however, has
usually proved unsuccessful, with consumers unwilling to download games that are flooded
with advertisements they are required to pay for. Finding a model to benefit all parties has
been few and far between, however in 2006, a games development company, Greystripe,
found a potential answer. They set up Gamejump.com, which provided hundreds of mobile
game titles from around 70 publishers at no cost to the consumer. “All the titles are free for
consumers to download and play, with publishers and Greystripe making money by serving
up advertisements prior to each game session, as well as in-between levels and at other
moments” (Davis 2007). After their first 12 months of operation, the results were
extremely positive, with “14 millions downloads made from its main online portal
gamejump.com, as well as other white label Greystripe sites” (Davis 2007). It is clear that
when content for mobile is made available for free, consumers are more than likely to
tolerate advertising that interrupts game play, as this is a sacrifice they are making in order
to improve their handset. The high success rate as demonstrated by Gamejump.com means
that by adjusting business models to accommodate advertising, games developers are more
- 29 -
3.3.3 Summary
Games however, are just a small part of a vast download landscape that allows the
mobile owner to improve the quality of their handset, as well as personalise it to suit their
tastes. Ringtones, screensavers, backgrounds, text alerts and music have all established
themselves within the market place, and are satisfying current consumer demand, however
the future of mobile means that soon consumers will want a broader range of content. The
cost to manufacturers and providers to produce this content will be extensive, which will in
turn create the opportunity for advertisers to participate and allow providers to administer
the content to the consumers for minimal cost. For mobile advertising to be a success, all
sectors of the industry must strive to provide the consumer with the broadest range of
quality content, as well as work together to ensure that all parties can benefit from its
application.
advertiser attitudes, the ultimate success of mobile advertising lies with the consumer.
Consumers are the driving force of any industry; without them companies are unable to
profit or function. The consumer can make or break the success of a new product or
important. Consumer acceptance is based upon the three previous key drivers of mobile
- 30 -
- Technology – all campaigns must be produced in accordance with
technology that is readily available to the consumer. If a campaign utilises the latest
in mind. If a campaign uses ideals that do not apply to the mobile consumer they
As addressed by Tsang, Ho and Liang, even with such cooperation from the other
stakeholders, creating successful mobile advertising still heavily relies upon the issues of
trust and privacy. ‘Since the mobile phone is a very personal device that allows an
individual to be accessed virtually any time and anywhere, mobile advertising must be more
The forms that Tsang, Ho and Liang discuss are the ways to ensure that any
challenges associated with trust are overcome. The first example of such form is
- 31 -
“permission-based advertising. This differs from traditional advertising in that messages
about specific products, services, or content are sent only to individuals who have explicitly
indicated their willingness to receive the message” (2004). The traditional methods of
consumers mobile inboxes, which are inevitably ignored, however permission based
advertising is supported by supplying the consumer with the information that they want to
receive.
provides specific rewards to individuals who agree to receive promotions and campaigns
directly to their mobile.” For example, mobile phone companies may reward customers
with free connection time for listening to voice advertisements. Both permission-based and
incentive-based advertising mechanisms are feasible for mobile advertising because the
location and advertisements are sent based on where the user is or where the user is going.
The aforementioned growth drivers all have significant impacts upon the future of mobile
advertising, and fulfilling the needs and desires of the consumer the desired achievement of
- 32 -
the industry as a whole. Nevertheless, the hindrance posed to advertisers has always been
the ability to measure the success and response to mobile ad campaigns, which has been
absent from the early years of the industry due to the relationship between network
operator and agencies. However, on the 11th February 2008, at the Mobile World Congress
in Barcelona, the GSM Association and five of the world’s leading mobile operator groups
made a major announcement that will have a long reaching impact on the future of mobile
advertising (Mobiad 2008). The GSMA announced that five of its members: Vodafone
Whampoa) have formed a working group to define common metrics and measurement
processes for mobile advertising as part of the GSMA’s Mobile Advertising Programme
(Mobiad 2008). This significant step towards a future for the industry is of great
importance in general; as it brings together the major network operators and their specific
markets under a universal umbrella to understand the ways in which consumers respond to
“The working group and the GSMA will facilitate crucial engagement between
mobile operators, advertisers and agencies, to help ensure that mobile advertising realises its
full potential for the benefit of all players in the ecosystem” (Anon(f) 2008).
The data will not be collected or delivered by a single organisation, but will be
openly available to all respected parties. The concept of working together, and allowing
even their business rivals to benefit from the information collected, is not fazing any of the
major operators views of the announcement. Steve Ricketts, Head of Third Party Services
for Orange UK is excited by this industry-wide initiative to support advertisers and agencies
in buying mobile advertising. He also insists that it is essential that the industry works
- 33 -
together to ensure mobile adverts work for both customers and advertisers (Anon(g) 2008).
The plans made by the GSMA indicate the beginning of a new era of mobile advertising, as
it will no longer rely on audience opinion and consumer feedback, but advertisers will now
be able to see statistics relating to campaigns in order to judge the rate of response, click
through rates and much more. Many of the surveys and research conducted within this
industry have shown that the majority of users do not read, or immediately delete mobile
advertising they receive in their phones, and with this new information, advertisers will be
able to understand why they are deleted, or not followed up, and how they can develop
These new plans reaffirm the industries desire to overcome one of the main
challenges that has faced mobile advertising since its birth, and work in unison to create a
Despite these major developments, there have already been steps taken by sections
of the industry to work around this obstacle. Specialist networks have recognised that
consumers are willing to receive advertising in exchange for free calls and texts as part of
their contract. This is where specialist network Blyk has recognised these strengths, and
applied them into a business model that can benefit no only themselves, but every
Blyk was the first advertising funded mobile network to be launched in the UK in
September 2007. It was described as the ‘new mobile network for 16-24 year olds’, which is
- 34 -
actually a requirement to be able to join the network. Blyk customers will receive up to six
marketing messages per day from the Blyk advertising brands they like on their phone. In
return, the network offers 217 texts and 43 minutes of calls free, every month. Instead of
flooding all the consumers with the same advertisements, the ads sent are tailored by their
usage of the phone. Marko Ahtisaari, Co founder of Blyk, explains how consumer profiles
are formed:
“For example, when an advertiser runs a campaign, they can see which groups of
subscribers react well to it and which don’t. That advertiser can then use this information
later to target these two groups differently. This information – which is proprietary to the
advertiser - will build up over time, and therefore there is a benefit from being a long-term
This form of consumer profiling is non invasive and still allows consumers to be
treated as individuals. By recognising what consumers respond to, as well as the occasional
questionnaire, Blyk are able to provide advertisers with detailed profiles that aren’t
disrupting consumer privacy, nor are they utilising private data such as address, ethnic
origin and employment to gauge any further opinion. Ahtisaari (2007) believes for it to
prove successful as an advertising method, it requires having “not only the right targeting
capability, but a variety of global and local brands to participate” .At the Mobile
Advertising conference 2007, Geoff Morley, as a representative of Blyk, revealed that since
its launch, advertisers engaging with the 16-24 year old subscribers are getting an average
response rate of 35% with the top campaign delivering 43%, and the ‘worst’ a hugely
enviable 12% (Cameron 2007). Blyk targets a specific market, with opt in users, utilising
brands that are appropriate to the target market. By using brands that appeal to the specific
market, consumers can receive information that they may want, or would usually search, to
- 35 -
receive. This directly benefits the consumer, by not only being provided with free minutes
and texts, but also establishing contact with themselves and the brands that they use. The
benefit for the advertiser is clear, as it creates the direct link between itself and their
specified target audience. The main result of this is that the advertising brand can see how
the audience has responded to the campaign, which in turn enables them to improve any
future campaigns they may wish to run. Obviously, this kind of network is tailored for an
audience that relies heavily on the mobile phone, however as this audience grows up and
develops alongside this type of network, the network will expand and adjust to provide a
service for an older age demographic. The plans made by the GSMA to measure mobile
advertising success and response will enable advertisers and operators to develop a similar
business plan, without restricting the use of their facility to a specific age group. By
bringing together two sections of the industry, all parties, including the consumer, will
benefit.
the immediate future of the industry will rely on cooperation between these different
sectors. The plans made by the GSMA, as discussed earlier, bring together network
operators to aid advertisers in selling advertising space in the mobile portal to potential
cliental. This is just one example of the importance of relationships between stakeholders in
the industry, and the ways in which they can come together to overcome the challenges that
face this embryonic media channel. There are many relationships that have already been
- 36 -
established, as well as relationships beginning to develop, that promise to have a real impact
One of the most noticeable relationships established in 2007, was that of Apple with
YouTube and Facebook. The iPhone had a YouTube button incorporated into its
‘dashboard’, which gave the user direct access to the site and its available content. As well as
this, Facebook developed an iPhone version of its website, which was tailored to suit the
screen size and functionality that the handset provided. The ‘Facebook Phenomena’ of 2007
drove social networking to the masses, and contributed to an 11% increase in mobile
internet usage through 2007. Dan Rosen, Head of AKQA Mobile division, believes that
“people accessing their social networks from a mobile device will be a huge driver of mobile
internet usage and a huge factor in the future development of advertising on the
platform”(Rosen 2007). It seems that not only Facebook recognised the opportunity to
expand its reaches, but the iPhone recognised its chance to provide an exclusive service for
its customers.
Nokia are the handset manufacturer that is making the most moves in terms of
establishing firm relationships with other sections of the mobile industry, with Facebook
being one of its many new connections. David Kaplan of Paidcontent.org reported that
Nokia and Facebook are working on porting the social network on to Nokia handsets in a
major way. The Facebook placement could be as prominent as the YouTube button on the
main screen of the iPhone (Kaplan 2008). The reports also suggest that Nokia could seek to
invest in Facebook to firm up the relationship and create the opportunity for exclusive rights
to a Facebook application. The potential benefits to all parties are clear, with an easy to use
and exclusive service for its consumers, a huge boost in sales for the manufacturer, and
expansion into and connections in Europe for Facebook. The application paves the way for
- 37 -
advertisers also, by enabling brands to use advertising space that is bound to be provided
within its structure. This is one of many opportunities that other advertising methods and
Nokia is the largest mobile manufacturer in the world, and the Facebook application
developments are just a small part of their partnership plans. Merely a month after reports
of the Facebook link up were released, Nokia announced a deal with Google to integrate its
search engine into the handset manufacturer’s mobile application. Ilkka Raiskinen, vice-
president of software and services at Nokia believes that providing choices for their
consumers is an important driver in Nokia's internet service strategy, and “this integration
allows their consumers the ability to use the innovative search technologies, which have
made Google almost synonymous with Internet search” (Raiskinen 2007 cited Jones 2008).
And the timing of this relationship could prove very positive for the mobile advertising
industry as a whole, as Nigel Sheldon, director of Starcom Digital Agency, believes it is not
only mobile social media that will drive the future of mobile advertising. He believes that
one of the key futures of the industry is “advertising related to mobile search. Search on
mobile hasn’t been completely figured out yet; it is still changing and developing rapidly.
But as it improves it will grow very quickly, and there will be enormous opportunities for
advertising” (Sheldon 2007). Because of Google’s superiority in the search market, if mobile
search is to take off with such significance then it will be Nokia that benefit as the majority
of those wishing to purchase a phone for its search facility will go with a reputable
manufacturer such as Nokia, with the added bonus of a reliable search facility provided
such as Google. This will in turn make advertising space as part of this relationship very
expensive, but the potential audience and consumer base will be extensive and therefore
- 38 -
5.1 Conclusion
The intention of this paper was to explore the challenges that face mobile
Using a variety of research and resources, the aim of this document has been to
demonstrate what the various stakeholders within the mobile advertising industry need to
do and how they need to work together in order to ignite the industry, and to create an
Early mobile media campaigns have achieved mixed fortunes demonstrating the
need for even the most basic of mobile marketing techniques needs to be fine tuned. The
next 5 years will be very exciting, with graduates who have been weaned on mobile phones
and the web, beginning their employment with the mobile phone operators, network
providers and advertising agencies. However having been educated during the early
development period of mobile advertising, they will be able to apply fresh theory to handset
Technology boundaries are changing every day, and the constant development of
the new 4G network infrastructure means that the next major step for the network or
handset could be tomorrow. 2007 demonstrated that mobile phones have become so much
more than communication devices; they are now a way of life. William Webb, senior
technologist from Ofcom, envisages a world in the future where mobile phones will play an
“On a typical day it (the mobile phone) will start work even before you wake.
Because it knows your travel schedule it can check for problems on the roads or with the
- 39 -
trains and adjust the time it wakes you up accordingly, giving you the best route into work.
It can control your home, re-programming the central heating if you need to get up earlier
and providing remote alerts if the home security system is triggered. It is your payment
system - just by placing the phone near a sensor on a barrier, like the Oyster card readers in
use on London transport, you can pay for tickets for journeys or buy items in shops. With
an understanding of location, the mobile can also provide directions, or even alert the user
medium is bound to be fully exploited, with consumers relying on their phone not just for
its organisational ability, but for their entertainment too, as feature length movies, podcasts
and TV programmes can all be downloaded in a flash thanks to the swift download speeds
offered by 4G. And all these will be watched on 3+ inch sized mobile screens, or even
projected onto the nearest wall by projectors built into the mobile phone itself (Collins
2008). These advancements are just the tip of the iceberg, with many developers keeping
industry, the most important factor outlined by this research is the consumer. Mathieson,
in his book Branding Unbound : The Future of Advertising, Sales, and the Brand
consumers interact with, and experience, the brands they know and trust. But that last
word ‘trust’ is indeed the operative word. The more we create compelling experiences that
- 40 -
earn our customer’s trust and respect, the more success we will find as the wireless age
Establishing a relationship with the consumer founded on trust; that is the true
challenge. Many of the issues discussed in this paper may never materialise. The reality is
the future is not predictable. However if the mobile advertising industry can create a
trustworthy relationship with its consumers, the lack of the latest technology or cheap calls
package will have little relevance. Consumers have been swayed by the incentives that can
be offered as part of them opting in to receive advertising, and there is evidence to suggest
that they will become increasingly receptive to advertisements from brands that they trust,
want to hear from, and can benefit from. Permission based advertising is the universal form
that the industry must accept if it is to excel. Consumers only want to hear from the brands
that interest them, which will in turn, allow these brands to target consumers who have a
The mobile advertising industry is on the verge of exploding onto the worldwide
market. The various challenges outlined by this paper indicate that the industry is willing to
cooperate and ignite its success. The stakeholder’s motivation for this success is imperative
in order for this highly anticipated industry to propel itself into the high end of big brands
advertising budgets. With 3 ½ billion mobile accounts in the world today, it is only a
matter of time before half of the worlds population begins to experience the power of
mobile advertising.
- 41 -
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Appendices
Response Response
Percent Count
Nokia 23.0% 23
Motorola 6.0% 6
Sony
32.0% 32
Ericsson
LG 6.0% 6
Samsung 30.0% 30
Siemens 1.0% 1
Sagem 0.0% 0
iPhone 1.0% 1
Panasonic 0.0% 0
Philips 0.0% 0
- 46 -
2. Please tick 3 boxes that indicate the key reasons you use your mobile phone
Cheap/free
57.1% (56) 32.7% (32) 10.2% (10) 1.53 98
calls
Cheap/free
42.6% (40) 51.1% (48) 6.4% (6) 1.64 94
texts
High level
web 0.0% (0) 19.0% (4) 81.0% (17) 2.81 21
browsing
Quality in
built 5.1% (3) 23.7% (14) 71.2% (42) 2.66 59
camera
High level
gaming 0.0% (0) 0.0% (0) 0.0% (0) 0.00 0
capabilities
In built
Satellite 25.0% (1) 25.0% (1) 50.0% (2) 2.25 4
Navigation
Organiser
0.0% (0) 4.2% (1) 95.8% (23) 2.96 24
capabilities
skipped question 0
- 47 -
3. What is the key reason for purchasing a mobile phone, for you?
Response Response
Percent Count
Response Response
Percent Count
- 48 -
4. What is your view of advertising in general?
skipped question 0
5. How do you currently react to recieving mobile advertising (mms, sms, web
link, push based advertising that you may have or have not opted in to recieve)?
Response Response
Percent Count
- 49 -
5. How do you currently react to recieving mobile advertising (mms, sms, web
link, push based advertising that you may have or have not opted in to recieve)?
skipped question 0
6. Which of the following would suit you best in terms of mobile advertising?
Response Response
Percent Count
- 50 -
6. Which of the following would suit you best in terms of mobile advertising?
Recieve no advertising
whatsoever, my mobile is a 29.0% 29
personal device
skipped question 0
7. What would change your stance on mobile advertising for the better? Please
only make two choices.
Response Response
Percent Count
Personalisation of advertising to
50.0% 50
suit the individual
- 51 -
7. What would change your stance on mobile advertising for the better? Please
only make two choices.
skipped question 0
8. What would change your stance on mobile advertising for the worse? Click
only two answers.
Response Response
Percent Count
Increased number of
84.0% 84
advertisements
- 52 -
Appendix 2 – Interview with Clare Chambers
Can you describe in brief the project that you have undertaken in association with
Vodafone?
The idea is to bring together Law, interactive Media and education, looking at
providing financial education in a fun and dynamic manner, through a mobile
platform. We are dubbing this as the M-Game. Myself and my team are being
sponsored by Vodafone develop the game over an 18 month period, using secondary
schools and using a sample of 13-15 year old mixed children to test the concept that
if you increase financial education, you increase financial inclusion.
What are the overall aims of the project gameplay, for example, what is the user intended to
achieve?
The user is intended to achieve a financial awareness, so good financial decision
making ability, so we can monitor, from the m-game, the decisions they make during
the game, which will be fed back to us and we will be able to see whether they are
making sound financial decisions or not. That information will be fed back to the
teacher who will follow up the game play with the class and feed individual reports
back to the children, and say ‘right you have done this wrong here, why?’, and
explain this is what you should be doing, try again but try doing this, and should
through gameplay, adjust and begin to make sound financial decisions.
- 53 -
of the mobile game, that is Marks area, but I have the input of how the game should
progress and the decisions that are wanted to be made.
Since being part of the development of the project, how has your perception of the mobile
games market changed, or even been established?
Coming from a legal background, it is a completely different world to what I am used
to, and I did not realise how much emphasis is placed on learning through play, I just
believed that computer games were a method for releasing tension and having fun,
but its not at all. It is actually an educational stimulus and there is so much business
going on in mobile phone gaming that many people just aren’t aware of.
What opportunities do you recognise for brands and advertisers to work with a
game/application such as your own, or mobile games in general?
Mobile phone gaming isn’t that developed and many of the games are basic and can
be downloaded from the internet, but for education purposes, there are not many
mobile phone games, so that over the next 5 or 6 years, there are a lot of companies
that will be producing mobile phone games. For me, advertisers such as banks and
financial institutions would like to have advertising as part of M-Games, because if
they can target consumers at 13 or 14, this is where they can establish brand loyalty,
as many people do not changes their banks unless something goes wrong, so for banks
it would be very beneficiary.
Do you believe there is a future for advertisers to work alongside games producers in order
to target consumers?
Ethically, yes, and I think it should be done ethically and morally, because if you are
teaching financial education, you would want the advertising to be correct, in order
to target the correct consumers and hit the right audience, and so for the game
developers it doesn’t take away from what the are trying to achieve.
What role will games and applications play in the future developments of mobile?
I had a discussion with Vodafone yesterday, and we were discussing which mobiles we
wish to test the M-game on, and decided to go with the Nokia N95, purely because it
has Flash Lite 2 on it, as well as a decent size screen, so that you can actually see the
game clearly, but it has to have a big screen, in order to not only see features of the
game, but for the game to have a substantial emotional impact upon the user. It must
be equal to tp the screen size of the likes of the iPhone and handheld consoles.
Mobile phones will therefore probably get bigger, whereas the recent trend has for
them to become smaller.
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wherever you are, play if for 5 or 10 minutes, and that is your learning done. Having
said that, they are not a means of replacing additional methods.
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