Searching for personalization

19 Sep 2006
00:00
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'Search is part of the Internet experience for everyone - that's where it begins, and over time we've seen more mobile devices being used to access the Internet thanks to GPRS and 3G,' he says. 'Users aren't just accessing operator sites but also portals they're familiar with, like Yahoo.'

From the device side, he adds, having a search icon is even more crucial as devices include WLAN connectivity. 'We now have a small but growing number of devices with WLAN capability. That's another significant add-on to the behavior patterns we see.'

Another factor for cellcos, says Marieke Effting, global telecoms product marketing manager at LogicaCMG, is that the major search engine companies are forcing their hand.

'Google and Yahoo are the most dominant search engines on the Internet and they are going into mobile already, with or without them,' Effting says.

That said, Kanjilal disagrees with the suggestion that mobile search is more about marketing than real money. 'Operators get the benefit of ARPU usage from the extra traffic generated by searches,' he says.

The aforementioned JumpTap figures appear to bear this out, but the downside - according to Effting - is that this plays to the 'bit pipe' business model that 3G operators would just as soon avoid.

'The challenge for operators is facing the fact that they're becoming a bit pipe. The revenue they're getting from content delivery now will continue, but that will end eventually and they will need new business models,' she says.

Searching for revenue

At the moment, according to Gartner, the main revenue driver for mobile search is premium pay-per-event content purchases. If a user searches for a Madonna ringtone, finds it and buys it, the mobile operator, search engine and content provider each take their cut. Gartner expects this to be the main driver of mobile search-related revenue through next year.

However, the real money - at some point - is expected to be in mobile advertising. Mobile ad revenues are 'virtually nonexistent' now, says Gartner, partly because both mobile search and mobile advertising are in the early stages of development, and partly because the value chain is considerably fragmented.

'Internet search engines offer sponsored links on mobile phones on a very limited basis, and their format hasn't proved effective yet,' Gartner's Shen says. 'White-label search also offers sponsored links but hasn't been able to make money from them, because of the small amount of advertisers and the fact that the search-related advertising model is still in its trial stages.'

Serious personalization

In the near future, however, it could well be a different story. The reason many players are bullish on the future prospects of advertising revenue from mobile search is the very nature of the mobile network itself: personalization.

'The advantage that mobile operators have over PC-based search is that they know what's happening on their networks,' says Effting. 'Mobile operators log every single thing that goes on over the network, so they have far more information about their users and have a complete overview of what the subscriber does.'

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