The presentation dealt with this idea: That mobile communications does not have to be a tactical endeavor, it can be a deep strategic one enabling companies to run leaner, to reach audiences in new and novel ways, to redefine a company organizationally, and create new markets with new revenues. In ‘creating assets and access in the intention economy’ I challenged our thinking in how mobile communications plays the key role in this rapidly evolving story.

I don’t think you need to be a community purist – to see the flawed thinking. Reading through the article, of the usual players and companies lining up to bid for local TV franchises, with the same old, same old business models I found myself, making observations and asking all sorts of questions:

• When we are connected up to and across each other, when we can get what we need for each other, why do we need more of what we don’t need?
• A people will only be free when THEY control their own communications – Frantz Fanon
• Markets are conversations, and markets thrive through, commercial trading, knowledge and information exchange and entertainment, hence the role of the creation of a thriving market place is not about shoving stuff down tubes. Its not one way, and reality of the role of producer and consumer has collapsed.
• Those companies that use revenue sharing to open up, stimulate, motivate and create a rich diverse eco-system are those that are commercially thriving: GrowVC, Qustodian, Android, NTTDoCoMo, Threadless,  are but 5 examples. So why is local TV any different?
• Ask who uses a search engine = 99%? and what are we searching for? Knowledge and information. And we judge the quality of that knowledge and information by its ability for us to take and make decisions and transactions, right now, in 5mins time, this afternoon, tomorrow – we live in the intention economy.
• Where is mobile in all this – because when we have a mobile penetration of 120%+ in the UK but millions cant get in online, surely local commercial communications, must be supported by mobile services? Qustodian certainly believes so, hence their growing relationship with Atletico Madrid. Because local is community – community is local. But this truth does not serve the needs of national media players.

So how on earth do media companies believe they can fund their business models out of the institutional failure of paid for push advertising? The article quotes Pat Loughrey, former BBC director of nations and regions, says: “It’s arse about face. It would be a pity and perverse if what is created a just another metropolitan-dominated TV service, in which the UK is only viewed through national perspective and serving national advertisers.”

Related articles

• Channel 6 bidders explain why Local TV will work (newstatesman.com)
• Two more join bidders for national TV channel (guardian.co.uk)
• DMGT chief voices doubts over Jeremy Hunt’s local TV plans (guardian.co.uk)
• Dyke outlines plan for 80 local TV stations in UK (newstatesman.com)
• How impartial is Jeremy Hunt? (newstatesman.com)
• Ofcom delivers local TV report to Department for Culture, Media and Sport (blogs.journalism.co.uk)

Lars writes in Japan’s super advanced mobile-web

The entire approach from key players in the value chain is focused on the direct benefit of the industry as a whole, ultimately via the satisfaction of their customers. A perfect example would be the generous – from day one – 90/10 revenue share to content providers. By the vary nature of building an open sales channel platform and offering an acceptable merchant billing fee the operators primed the data pump with plenty of interesting content rushing into their pipeline. Another key move from the operators was their decision in 2004 to make Flash-Lite a mandated pre-install on all devices. While of course their menus looked even more compelling, the move also allowed content players a common code platform with less concern about specific handset rendering parameters. The golden triangle of open web access combined with flat-rate data plans and ubiquitous 3G speed has lead to a server-side model driving ever greater adoption of content and services. Of course the telcos are happily counting their flat-rate data subscriber revenues as a result of even more great contents on offer and the satisfied mobile web surfers keep on clicking.. the win-win-win scenerio.

Alan Moore mobile/enterprise keynote video

Related articles

• The DoCoMo-Baccarat Phone: Smart in Another Way (blogs.wsj.com)

It also has a very interesting revenue model.

Fernando Sánchez-Terán, Director General of Qustodian said: “We are very pleased with our launch results, especially with the number of users. Whilst these users were unsure at first, after trying the service the vast majority described Qustodian as verygood and very innovative. In fact, 95% of them would recommend our service to their friends presenting it primarily as a form of advertising for products and services that they would like.” He added:

Advertisers have equally welcomed the arrival of Qustodian to the extent that somehave used it as the reason to start to invest in mobile marketing. They particularly value this new medium for its rich formats (images, videos, links, coupons), user interaction (consumer feedback), detailed user segmentation and its focus in Return on Investment (RoI), with average message opening rate of around 70%.”

About Qustodian:
Qustodian is a new, independent digital media company focused on providing next generation mobile advertising and marketing solutions using the mobile internet to communicate with mobile phone users.

Its goal is to provide a mobile marketing and advertising service that puts the user in control of what they receive, when and how. Members are offered the opportunity to create and manage a digital profile of their preferences so that they receive the financial and commercial benefits of the use of this data. This is in contrast to many large corporations who are currently collecting this profile data from us for their own benefit. This approach not only benefits the user, but also the advertiser, as the advertiser knows that the user has agreed and wants to receive communications from them.

Qustodian was founded in 2009 by Spanish and British professionals from the telecoms and media industries, including experts in mobile marketing, social intelligence and technical innovation. In 2010, Inveready Seed Capital invested in Qustodian. Qustodian are currently located in London, Madrid and Barcelona.

More on mobile from SMLXL

Here is the presentation that I gave.

Rethinking Personal Data – is a brief outline of the initial stages of that investigation. in a post published by Telco 2.0 (also part of The Futures Agency), they write,

Given the speed at which technology and online user behaviour is developing and the slowness of regulators in keeping up, the project looks as much at legal/governance issues as commercial, technical and user acceptibilty issues.

In an event organised by the WEF the top 7 issues were:

1.) To create a global ‘trust framework’ for customer data and digital identities.
2.) To re-define the fundamental telco business model and the methods for industry commercial innovation.
3.) To define how to partner better with adjacent industries
4.) To develop more appropriate regulation for cross-border, cross-industry collaboration.
5.) To create a more compelling business case for (fixed/mobile broadband) infrastructure investment.
6.) To clarify the opportunity for Telco Cloud infrastructure.

Telco2.0 point out that, this is the sort of list that existing telco trade bodies can’t really conceive of, and which WEF is uniquely placed to support. But, the striking thing for the Telco 2.0 representative was how important customer data and business model innovation ranked in order of strategic priorities for the telecoms industry (as opportunities and challenges).

Legal battles between Apple and Nokia have been ongoing in the US over smartphone technology but the fight has just moved to the UK. Apple Inc. said it filed a patent-infringement lawsuit against Nokia Oyj in the UK.

And

The complaint – which relates to patent-infringement claims that Apple lodged against Nokia in December in the US – was filed yesterday in the UK High Court of Justice Chancery Division. Nokia spokesperson Mark Durrant said this was an “unsurprising development”. “It changes nothing in the fundamentals of the matter, which are rooted in Apple’s refusal to respect Nokia’s intellectual property and attempt to free ride on the back of Nokia’s innovation,” he said. Durrant added that litigation is always Nokia’s final resort but the company will continue to “defend itself to the utmost”.

Via Silicon Republic

In my last blog I wrote about The Mobile Patent Wars and how it will also impact Mobile Marketing in the near future. It is an accepted view that patents will play a role in capturing market share and even creating dominant standards for the industry. So how could we try to predict how patents in the Mobile Marketing will be used, and also how they will impact business models based on Advertisement revenues.

As the world’s greatest ice-hockey player Wayne Gretzky once said:

I skate to where the puck is going to be, not where it has been.

He also said …

A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.

So lets use the Gretzky approach to looking patents in Mobile and Mobile Marketing

Previously I mentioned the ongoing patent battles between Mobile giants like Nokia, Apple, HTC and others. However looking back at what has previously happened in the Mobile industry could give further insight into what can be expected.

One example of a company that has utilised patents to play a key role in the Mobile world is Qualcomm, who become the largest fabless chip supplier in the world by focusing on developing their technology backed by strong patents and a licensing model. There are of course other companies like ARM and others with similar business models who have based their development of technology backed by strong patents and know how to license to the industry. So was it all friendly licensing that took place as Qualcomm’s CDMA technology took a strong hold? Of course not, there were well documented battles with Nokia (here), Samsung, Broadcom (here), and others. Also it is big money we are talking about as in the Nokia settlement in 2008 the amount was $2.3B to Qualcomm. Especially the battle between Qualcomm and Samsung, settlement of $1.3B was an interesting one as Samsung is one of Qualcomm’s largest customers.

Without a doubt it is not nice to get a letter demanding licensing royalties or someone asking you to stop selling your product or services, but the reality is that it is part of business in a globalised world and patents will be used strategically to gain competitive advantage. So who will be the Qualcomm of Mobile Marketing? Well anyone who acquirers the CVON patent portfolio will take a significant strategic position.

Where is the patent for Mobile Marketing now?

With the entry of Google (here) and Apple (here) as key players in the Mobile Advertisement market in the last 12 months it is now widely accepted that advertising will be a key ingredient for mobile. Established players like handset manufacturers; Nokia, Samsung, and the operators like Vodafone, Telefonica (O2), T-Mobile and others have a new competitor. However looking at the companies with the most patents in Mobile Marketing in the world, June 2009 the entry of Internet players did not come as a surprise. However, it would have been a surprise to many of these companies to find CVON amongst themselves:

1. Yahoo
2. Microsoft
3. Google
4. CVON Innovations
5. Nokia
6. NEC
7. Qualcomm
8. IBM
9. AT&T
10. Sony
11. Motorola
12. Sony Ericsson
13. Hewitt Packard
14. Hitachi
15. Alcatel-Lucent

All of these players are in the midst of an arm race building an arsenal of patents that will help them protect their own position and of course also be used against others once the time is right. As discussed in The Mobile Patent Wars there are several of these top patent owners in Mobile Marketing who have locked horns before in US patent litigation.

Where is the patent going to be for Mobile Marketing?

Ad-funded business models are already starting to play a big role in Mobile Marketing. The number of Applications at the iStore that were adfunded was > 50%

earlier this year and I would expect that to increase as better targeting and relevance is achieved between the ad and end user. Microsoft was the latest to include adfunded mobile applications compatibility in the Windows  Phone 7 platform when launched recently (here).

Gartner has a similar view of the importance of Adfunded applications in the ecosystem of applications …

Worldwide mobile application stores’ download revenue exceeded $4.2 billion in 2009 and will grow to $29.5 billion by the end of 2013. This revenue forecast includes end-user spending on paid-for applications and advertising-sponsored free applications. Advertising-sponsored mobile applications will generate almost 25 per cent of mobile application stores revenue by 2013. – Dec 2009 (source).

Then it should be a case where all these providers of mobile platforms with adfunded applications and gaming should take a look at the granted CVON European patent EP1970854B1 (here), which covers Adfunded mobile applications and was filed as early as 2003. Messaging based Mobile Marketing is also taking off in many different markets. Only the other day was it announced that O2 now has attracted more than 1 million users of the O2 More service with as high as 26% response rate on certain Advertisement campaigns (source). The messaging based segment is still the largest revenue generator of Mobile Advertisement.Further InMobi, the world’s largest advertisement network, said 48% of all its display ad impressions were carried on Nokia phones in July 2010. With Nokia having about 40% of the smartphone  market (here).

All the in messaging advertisements will need to be highly relevant to the end user and also optimized to work well in operator networks and telecom infrastructure. CVON has developed technology and patents to achieve just that with more than 300 pending and granted patents, such as US7653064 and US7606562 as a mere mention of two.

So historically players now looking to dominate the Mobile Marketing space have been at each other in some ways with patents. All these players have been building up their weapons arsenal in the last 5-6 years, and no matter what the winning types of mobile marketing ends up becoming the most preferred in years to come patents battles or wars will be taking place.

Another complexity to this story is of course the Non Practicing Entities (NPEs), or patent trolls as they sometimes also are called, who are also looking to make an impact in the Mobile Marketing world, but that is for a later blog.

However, the Jury is still out to who will be best positioned for the future patent wars but I would not be surprised if someone called CVON the Qualcomm of Mobile Marketing, so whoever buys the patent portfolio at the upcoming auction on 11 Nov 2010 will be a force to be reckoned with.

There are currently 4.6 billion mobile devices in the world, and mobile and the internet are rapidly converging. The reality is this that patents will still be used as a means by which one can protect market-space, future revenues, and growth.

The fact of the matter is that patents are all too often an after thought in many M&A process, RIM/Apple/Nokia/HTC have all been involved. Yet more multinationals are getting into patent wars, as we see today, using patents, to protect their competitive advantage. As our mobiles become our remote control for life – we will want to do more stuff on them. We will want to personalize, as well as having ubiquitous access to information both in terms of our personal and commercial lives.

Dynamic data flows marketing and commerce: Data is moving centre stage in the highly competitive world of marketing and commerce.  And the reality is that our mobile devices are becoming, or have become our remote control for life. And we will increasingly use our devices to do more stuff. People today also live in a world defined by search – where we are searching for knowledge and information that enables us to take decisions and make transactions which are also contextualized by time and place.

I see the convergence of a number of key trends that make mobile patents pending GRANTED in creating strategic opportunity. These trends are that we as individuals, now seek information, that we identify as; timely relevant and contextual – the more personalised the better – subsequently on the mobile platform we will only ever accept commercial communications on this basis – data therefore becomes hugely important and so will mobile payment. (More than US$1.7 billion was spent in 2008 on mobile advertising, and this number is expected to grow to more than US$12 billion by 2013). More significantly, one in seven media minutes is spent with mobile already today, Tomi Ahonen tells us Anyone that has a patent portfolio that addresses these needs and trends will find themselves I would suggest in a very strong strategic position,

So what are we talking about?

• In-application advertising
• Message tagging advertising
• Mobile search advertising
• Direct marketing to mobile devices
• Social media and instant messaging
• Pay per action in mobile devices
• Advertising campaign optimization in mobile devices

And who should be interested in acquiring patents for strategic use? Mobile carriers, device manufacturers, application vendors, mobile platform operators and developers, content providers, search providers, and other entities operating in the mobile device arena. So, when one of the largest mobile patent portfolios comes up for grabs – I suggest its worth taking a serious look at. And why do I say that? Because, many of the patent families within the portfolio’s focus will play a strategic role in controlling access to the market for both new entrants and existing players. As the mobile advertising market grows over the next several years, the strategic value of this portfolio will continue to increase. There is an old saying which is, “he who pays the ferryman calls the tune”.

As Tomi Ahonen writes,

A few years ago there was a big battle of will the internet win or the mobile? Now it seems to be clear, it will be that the internet will converge onto the mobile. In fact, the future of the internet is mobile. Google CEO Eric Schmidt has been saying that for years already, (and also Vint Cerf- ed) and the new Google strategy, ‘Mobile First’ is a clear indication of how seriously they are taking it. And Google are not alone among internet giants believing in a mobile future. From 2007, Yahoo has been saying the same. So if you thought that perhaps the internet was threatening your business, that may be a short-lived threat, say for industries already feeling the full threat like bookstores or video rentals or music stores or travel agencies etc. If the internet itself is headed to mobile, the salvation for a bookseller or video or music or travel company is not to go online, it is to ‘leapfrog’ the technology gap and go directly to mobile. Like the book publishing industry is doing in Japan for example where mobile books outsell ebooks already.

(Convergence Contest? For the 5 Trillion dollar Trophy)

Such a profound shift in how we find stuff we want, how we trade, and pay for goods means there will be a re-ordering of the media and commercial landscapes, whether we like it or not, patents will play a big role in how this plays out, or will at some point play a key role in; who wins, who loses, who stays and who goes.Tomi Ahonen, also makes a very important point, in terms of what happens if you are not tuned-in to the very near future, the ‘lesson’ writes Tomi is in cameras.

The camera industry boldly and bravely (and foolishly) thought mobile phone based cameraphones would never catch on, and never rival their industry. That was a short-lived battle that was over in only 3 years. Sharp and J-Phone of Japan launched the world’s first cameraphone in 2000. By 2003, more cameraphones were sold globally than all stand-alone digital cameras. By the next year, cameraphones alone outsold all types of stand-alone cameras (digital and film-based). Today cameraphones outsell stand-alone cameras by 10 to 1.

The camera industry correctly forecasted a dramatic growth in consumer adoption of digital cameras for this past decade. The growth was even better than they expected. But the growth was shifted from stand-alone digital cameras to cameraphones and the sales of stand-alone digital cameras stalled and stagnated.

The cameraphone did not kill the stand-alone camera. It just took 90% of the market. For the mobile industry that was far more than ‘enough’. The big phone makers like Nokia, Samsung, SonyEricsson and LG are not in the business of creating professional cameras. They can happily leave the small ‘pro market’ to the specialists like Nikon and Canon. But as the mass market vanished, the mass market business also shifted. Kodak, Minolta, Polaroid, Konica and so many other major camera industry players had to abandon the camera related business and shift to something else like professional imaging or scientific instrumentation or photocopiers or whatever, or else go bankrupt – like Polaroid has done, twice already.

Sobering stuff. The mobile patent wars may have only just begun.