Communities Dominate Brands

Convergence Contest? For the 5 Trillion dollar Trophy.

Vacations are good for fresh thinking. I started today's morning preparing to come back to work and my mind was buzzing with thoughts of the truly big picture. Last spring and summer I often got caught up with the minutiae of the percentage in market share or the next user number in text messages or the latest added consumers to mobile, etc. But there is a big picture to it all. The Contest for Convergence for the 5 Trillion Dollar Trophy.

To understand how enormous number we are looking at, its more than ten times bigger than the global computer industry including all PC hardware from desktops to laptops and netbooks and tablet PCs like the Kindle and iPad... plus the applications and software industry enabled by the PC industry. Take all that, and multiply that by ten! Or take television and radio, the total broadcast industry - and multiply it by 15. Or take the global internet and all its revenues out of Google adwords and broadband fees etc, all of the internet revenues - and multiply that by 20. We are looking at the biggest economic prize of our lifetimes, and it is 'in play' as we speak, with Fortune 500 giants like Nokia, Apple, Google, Hewlett-Packard, Vodafone, Microsoft, Sony, Samsung etc all angling to be one of the winners in this ultimate race of the decade, perhaps even the race of the century. So a quick review of where we stand.

I have been preaching the convergence story in each of my 9 books and was personally involved in the early stages of the digital convergence, from creating the world's first computer company advertisement to the internet (media and internet convergence) to leading the team that created the world's first fixed-mobile converged solution (fixed and mobile telecoms convergence) to authoring early documents on the future of convergence (at Nokia's Telephony Gateways digital convergence unit, I authored the first White Paper for the industry to discuss how to do the internet on mobile). That was all more than a decade ago when I was actively involved in 'doing it' rather than a consultant 'preaching it' haha...  But I do know quite a lot about the realities of digital convergence not only from studying the matter, but from doing it myself.

So its no surprise to my readers and fans, and readers at this blog, that I believe passionately in digital convergence. So lets not review my view. Lets see what some others have said about digital convergence 'recently' - say past few years.

COMPUTERS, MEDIA

The computer industry is headed to mobile. After Apple introduced the iPhone in 2007, and changed its name from Apple Computer to Apple, and now calls itself a mobile company, the bigger computer maker rivals have all joined the chorus. Now Dell, HP, Lenovo, Acer etc all sing of the same hymn book. The future of the computer industry is mobile. Maybe that is not a big surprise, they have been predicting the pocket computer for two decades already..

The media industries are more interesting. The (former) Director General of the BBC said that all broadcast content will be available on mobile (and BBC's successful iPlayer is a perfect example of how a broadcaster can take a big slice out of the digital convergence into mobile). The CEOs of the major media giants from Publicis to Warner Music to EMI have all started to sing 'future of media is mobile' stories. Publicis CEO Maurice Levy said that within a few years "most of the music", "most of the information" and "most of the advertising" will "transit through your cell phone."

WEB AND ADVERTISING

What of the internet? Good question. 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 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.

Advertising goes where the media audiences go. Advertising has been on mobile phones for a decade already but in mostly small numbers and niche campaigns hidden in the digital ad budgets. That changed last year when the advertising industry woke up seriously to mobile. When the global ad budget declined, and all other forms of advertising shrunk in revenues, mobile advertising spending doubled worldwide. As I witnessed when I delivered my keynote to the Mobile Marketing Association global event in the meccha of advertising, Manhattan of the Mad Men of Madison Avenue haha, the big global ad agencies are all ramping up their competences in mobile, and I am witnessing it myself with far greater interest now in my mobile marketing workshops and seminars, such as delivering a keynote to the big MMA event in Sao Paulo this week. The global ad industry top management may be late to the mobile party, but they are dead serious about it now. As we learned from Universal McCann the advertising giant, one in seven media minutes is spent with mobile already today, as mobile is often the digital response channel for legacy media like television, radio, print etc. Voting for American Idol, that kind of experiences.

WHAT OF MONEY

So the telecoms industry itself is migrating to mobile, no surprise anymore this late in the game. The computer industry is going mobile. The internet is going mobile too. And the major media industries and advertising are headed to a pocket near you too. But thats not the full picture. I have said for many years now, that we have yet another 'dimension' in this race, of a major economic sector headed to mobile: Money. In practise, its banking and credit cards when considering the classic major financial industries, or digital money in a technical sense (insurance is also going to join the mobile revolution a bit later). The first two SMS-enabled vending machines were installed in Finland twelve years ago, and soon thereafter the first SMS-enabled parking was launched in Norway. We've had full mobile payment solutions in the Philippines for a decade already. Mobile credit cards are nearly as old. But the migration of money is very slow. We hear of some great successes - more than half of Helsinki area public transportation single tickes are sold via mobile, and all of parking in Estonia is mobile, and now more than half of all banking accounts in Kenya are mobile banking accounts. But its still tiny bits in small countries. Yes, about half of South Koreans and the Japanese have mobile digital money enabled phones and services, but its nowhere near yet where half of their economy would transit the phone, and they are the most advanced digitally converged nations.

In m-money it is very early going. Gartner told us that in 2009 there were 73 million people who used a mobile phone to make a payment. Informa counted that the world had  67 million people with a mobile banking account. Contrast that with the 2.1 Billion people with a banking account as reported by the BBC last year. If we want to measure the 'migration rate' then currently one third of one percent of all banking accounts have migrated to mobile. That is a very tiny fraction. But that was exactly how it was with smartphones vs personal computers in 2000, or how it was with the mobile internet users out of all internet users in 2002, or what it was with advetising in 2006. Less than one percent. Its easy for many in banking and credit cards to be fooled into thinking this tsunami wave of convergence will not hit their shores.

Yet in South Africa it is normal to get your paycheck paid directly to your mobile account. Norway was the first country to let you submit your tax return by mobile. South Korea was the first country to make 'cards' out of Credit Cards optional - all credit card services are automatically enabled onto your mobile phone (instantly when the credit is approved), and if you want, a free plastic traditional credit card can be mailed in a few days also to your home address - if you so desire. There is no need for plastic cards in South Korea, but you may travel to a less advanced country like say Germany or USA or Australia or France where they 'still use plastic credit cards' haha... In Japan the mobile wallet is the most advanced where it not just includes your banking and credit and payment and loyalty cards. It adds your keys to your home and car, the pass-keys to your office, your identity card, and now as the phone collects your payment behavior, they have launched the mobile consierge to the phone, to help manage your life. The users absolutely love it, suggesting the phone seems to read your mind..  And taking those lessons, Nokia launched Nokia Money in India and is enabling near field to all its new smartphones.

While the big banking execs are mostly blissfully ignorant, thinking that launching an iPhone App is tantamount to a mobile strategy, haha, the tsunami wave is well under way. So the migration has started. Sweden started this summer the first parliamentary discussions about when is the right time to abandon printing cash, and moving to a mobile money only digital money economy! They aren't about to do it any time soon, but they have started the serious discussion about the end of money as we knew it.

That covers the giant industries I want to mention in this blog today. Telecoms, broadcast and print media, advertising, computers, the internet, banking, credit cards. These are all industries whose size is above 200 Billion dollars annually - ie each is bigger than the total global handset business including smartphones and dumbphones and all phone based accessories like spare batteries and phone covers and memory cards etc (combined, is worth about 160 billion dollars in total - a small fraction of the 1.1 Trillion dollar mobile telecoms industry where the majority of the revenues come from mobile services like voice, SMS and premium mobile data services).

OTHER INDUSTRIES

There are many more industries, more small ones, that also are impacted by mobile, like cameras, music, videogaming, the watches and clocks industry etc, but those are so small (all under 100 billion dollars in size) that I won't spend much time on them now. They were involved in the first mobile battle of convergence, what I called the 'Battle for the Pocket' in my second book M-Profits in 2002.

There also are many other industries that are seeing impact from mobile, but who are unlikely to be totally cannibalized by mobile. So take air travel. Finnair launched the world's first mobile check-in in 2001 and today half of their passengers use the service. But mobile will not enable our air travel. We can't fly on the phone. We can book our seat and pay for the ticket and get a boarding pass to the phone, but we still need an airplane to burn jet fuel to fly from one airport to another. That isn't changing by mobile. So mobile can only influence a small part of the travel experience, whether in airplanes or hotels or trains etc. But in music, mobile can cannibalize all digital music. Same in the newsmedia or gaming or advertising or indeed money and banking and credit cards.

So yes, the automobile industry is eager to get into mobile too, many new cars feature SIM card slots for example and the next internet (after the internet has gone mobile) will be in cars. But again, if we need a car to get us from point A to point B, until they invent teleportation, we will keep needing that car (or some rival like a bicycle or bus etc). Mobile cannot cannibalize the whole car market like it can't cannibalize the air travel market or the hotel industry etc.

So this blog is about those industries that can expect far more than half of their total value, possibly the whole industry, to migrate to mobile in the coming years and decades. And that, if we take the dozen industries mentioned in this blog (excluding travel, cars, hotels etc) is worth a cool 5 Trillion dollars or about 9% of the total global economic spending of all economies on the planet.

HOW FAR HAVE WE COME?

So lets look a bit at how far we've migrated into mobile.

The telecoms industry is far along the way. 81% of the total telecoms industry has migrated from fixed landlines (0% in 1978) to mobile when counting total subscribers.

The internet had 0% mobile users in 1996. At the end of last year we reached mid-point, where half of all internet users accessed the web at least part of the time using a mobile phone (which includes the simple WAP type of mobile internet usage common in many parts of the Emerging World markets). So the internet has migrated 50% in 13 years.

Meanwhile there was no mobile phone that was a computer prior to 1997. There were stand-alone PDAs yes, but no advanced 'smartphone' to give computer like performance. Today all major PC makers have entered the smartphones battle and all say the future of the computer is the smartphone (something I have been saying for many years now). I counted on this blog that if we add both the traditional PCs including desktops and portable computers, and the smartphones, we get a total market size of 465 million units for 2009. Smartphone accounted for 37% of that amount last year. So we can say that in 13 years, mobile has already cannibalized over a third of the computer market.

Music was the first mobile content type in 1998 and today about 38% of all consumer music spending is mobile (when we include ringing tones). Videogaming followed and today a quarter of videogaming service revenues is generated on mobile. It would be an interesting market analysis to count all gaming-oriented smartphones (like the iPhone, most downloaded apps are games after all, the iPhone can be said to be the first globally successful gaming phone platform to rival the Nintendo and Playstation Portable..) and their value into the videogaming software value, the proportion would be bigger still.

I don't have a good measure for wristwatches and alarm clocks. But sufficient to say that clearly more than half of consumer uses of telling time - and of the wake-up alarm - is now from the mobile phone.

Of the big media industries like print, broadcast and the related advertising industries, their migration into mobile has only started and is in the low single digits in percent of total revenues or total content delivered. So these are all very early in the game.

And like I said, Banking and Credit Cards are at far under one percent of total users (and far far less than that in total value of the transactions going through mobile).

A LESSON

But I want to end on the 'lesson' for this blog. 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. This is a common pattern in the 'Battle for the Pocket' as I have chronicled from the PDA vs Smartphone battle to the musicphone vs iPod battle, etc. Same pattern always. So what happened to the big four camera brands? In 2000 when the cameraphone was launched the world's biggest camera brands were  Canon, Konica, Minolta and Nikon, all out of Japan. Today only two of them continue making cameras, Canon and Nikon - which both quickly shifted their focus from consumer snapshot cameras to premium professional and semi-pro camera systems. Minolta and Konica have quit the camera business altogether. This is the decade of the biggest growth of consumer camera use ever, where the annual market for new digital camera purchases grew by more than 10 fold. It was the golden age of cameras, yet two of the big 4 failed to survive this enormous opportunity.

Same is true of the various other cameras-oriented industries like Kodak and Polaroid. The world's most sold camera brand is Nokia. The world's most sold branded camera optics are not Nikon or Canon branded lenses, they are Carl Zeiss optics, on many premium Nokia cameraphones. Of the total population on the planet, out of any person who has ever used any type of camera, for 9 out of 10 such users, the only type of camera they have ever used, is on some cameraphone. It may be difficult for older readers in the Western industrialized countries who see the long lines of cameras and accessories sold at the electronics stores, yet the numbers are perfectly clear.

So lessons. 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.

If they had aggressively pursued the mobile market, either through a premium cameraphone or a specialist role in the ecosystem or in partnership - any of the big giants of cameras could have a major role in the mobile industry today. Look at Apple, a computer maker, who decided to do its music player (iPod) on a phone as the original featurephone iPhone 2G, and then decided to make it a full 'pocket computer' by the second release of the iPhone 3G as a real smartphone in 2008. They only sell 2% of the world's total mobile phone handset market today, but its such a huge market, that it powers the majority of Apple's revenues and the majority of Apple's profits.

That is what Lenovo wants now, as they launched their LePhone and sold 100,000 units in the first quarter. Its not as good as Apple did in 2007 but Lenovo is at least taking a stab at this market, rather than how the cameramakers hid their heads in the sand and tried to avoid the truth.

I counted that in 2006 there were 7 of the Fortune Global 500 biggest companies on the plant, who made a smartphone. These were essentially the big phone makers like Nokia, Motorola, etc. At the start of 2010, there were 23 companies that had either launched or were launching a smartphone, out of the Fortune Global 500. That made the smartphone space one of the most competitive of any industries on the planet, with probably more global giant rivals than any other industry ever in the same space. (At least when it comes to banking, most banks tend to operate regionally or nationally, with only a few global banking brands).

Note this growth was not that smaller 'newcomers' making smartphones had 'grown' into the Global 500. It meant that previous global giants of other industries had decided to enter the mobile space, like computer makers such as Apple and Dell, like internet giants like Google and Yahoo, like mobile operators/carriers like Vodafone and Hutchison, and softwre maker giant Microsoft etc. Obviously the year has not been kind in the over-competitive smartphones bloodbath (Google and Microsoft very visibly quit the smartphone handset business already, but both are increasing their software and services focus on mobile, so they have not abandoned the opportunity in digital convergence).

WHAT DOES CONVERGENCE ENABLE

Remember that converence gives us new opportunities of better experiences and as an industry, vast new opportunities. When you take a bookstore and put it online like Amazon, yes you can have some 'distribution' and 'warehousing' benefits and you can sell a larger catalog of book titles than the bricks-and-mortar bookstore down the street. But what of the reviews. What of my shopping history. What of others who liked that book. And personalized recommendations. Such abilities are impossible in traditional bookstores. In a small 'mom and pop' bookstore, if you were a loyal customer, you could perhaps gain the familiarity with the bookstore owner, to be able to get some recommendations. But that is rare and would take years of competence to develop by the bookstore owners, and still would not be nearly as powerful as the Amazon recommendation engine, in pinpointing exactly what kind of books I may like.

Look at Google. Before search engines, it was not practical to try to find 'all available information' on a given topic, unless you lived next door to a major library like the US Library of Congress and were a wiz at using the library's card catalog system - and then spend hours digging through book indexes and tables of content. It would still not be as thorough as any Google search today, and it would take years to learn the skills and days of research in the library. Yet a child of 6 can do the same within a fraction of a second on Google today.

The digital convergence enables fantastic new services and abilites we never could have imagined. Take airline seats today. What travel agent could have specialized in Hong Kong to Sao Paulo travel for me today. What price ticket would I have gotten, on what airline combination, and what miserable layaways on the travel connections? Yet we can go to Expedia or Travelocity or Opodo whatever travel site you want to use, and get to see dozens of flight options - and their prices - and their routes - and the actual aircraft used. Then we have seat guru, which will tell me what in-flight electricity options are on that class of seat on that specific aircraft type on that particular airline. A paper based traditional travel agent would never ever have that capacity, except perhaps for the few 'domestic' airlines that serve their home town. But I see that instantly for all airlines. We get vastly superior services for consumers when we seek opportunties out of digital services. And this is all before we start to enable my flight itself with mobile check-in, or the hotel does a mobile phone enabled locks to my hotel room etc.

WILL DISRUPT MORE THAN ENABLE

But it also often means cannibalization of the legacy services and their eco-systems. So take music. At the end of the previous decade, the majority of music sales was through the sale of music CDs. Artists would compile 'albums' of about 15 songs, sold at a price far greater than the one hit that currently made the artist popular on the charts. A huge support system was in the recording industry to produce the sound of the music, to produce the CDs, to ship them to music retail stores, and to use the radio stations, music video TV stations like MTV, and promotional concert tours to help promote the album sales.

Then came the internet, Napster, social networking, MySpace and YouTube. Almost all music became available on the net for free. The market changed drastically. The big music store chains started to fail and go out of business. The CD market shrunk sales year after year. But music didn't end. The market adjusted in two ways. The internet and digital enabled new ways for fans to discover their music and artists (MySpace, YouTube, social networking). Artists could still sell tickets at concerts, so they shifted more of their income from selling albums to concerts. And new digital formats emerged like the ringing tone and ringback tones, which now deliver a third of the total global consumer spending on music worldwide. The music industry was slow to get into this opportunity and there were many problems along the way - witness Crazy Frog. But consumers have not abandoned music. They still spend about 30 Billion dollars on it annually, only the traditional music publishing industry is getting an ever smaller slice of that.

So some skills are changed. The digital convergence brought powerful authoring and editing tools to any musician on their PC (and eventually increasingly also on their smartphone). That diminished - but did not eliminate - the role of the traditional music studio for creating music. Digital convergence changed music creation - the sampling of instruments popularized by the early 'synthesizer' music of the 1970s and 1980s has made it easier for an artist to 'master' multiple instruments. The mechanics of expert handling of a guitar or violin or piano is no longer as critical for the creation of music. It did not end the need for 'real musicians' ie playing at symphony orchestras etc, but it helped popularize music creation, by the masses, for the masses. Digital editing of sound has enabled errors in sound quality to be 'fixed' - ie some boy bands and girl bands may have members who don't have good singing voices (perhaps are better dancers or just pretty on stage ) that can be increasingly 'fixed' electronically. Again, that does not end the need for pure excellence in real singing - witness UK singing sensation Susan Boyle

What the digital convergence did, most of all, it dis-intermediated some players, and re-intermediated others. The 'talent scout' at recording companies (The Big Labels) is a job that is disappearing. That is nothing new, once there was a huge need of typing skills at major offices, typing pools, before the word processor and email made most of their typing work redundant. There was once a need for staffs of receptionists to answer phones, but voice mail took most of those jobs. Etc etc etc

We still have a need for real music and real musicians and real creative arists. The digital convergence may be making the difference between the average musician and superstar even greater - a Madonna or Rolling Stones can command astronomical fees, but the average starting rock band probably earns about the same per 'gig' per night, adjusted for inflation, as rock bands did in the time of the Beatles and Elvis 50 years ago.

HOW BIG WILL IT BE

I think we have enough evidence from early digital convergence to make some preliminary hypotheses.  We can assume that the legacy businesses, that do not embrace the digital convergence, to survive as a premium professional services industry but eventually fail the mass market. Thus they cannot sustain the number of players they have today. But that likely digital convergence will not kill most industries. These will be tiny niche industries, but can be profitable and sell to very passionate specialist customers, and those who specialize within the remaining industry but manage to capture the premium end of that market, can make a nice living in it. These would by definition become very stagnant mature markets sustaining only a few players.

A new converged economic opportunity emerges within the digital convergence which will not be as big, as the separate industries would be separately. So the cannibalization will eat into the size of the 'total pie' of the industries prior to convergence. But balanced against that shrinking of one pie, is the simultaneous growth of the total pie. So far up to now, the converged opportunity has always ended up far bigger than the initial industries that got into it.

When the battle for the pocket started a decade ago, the total value of all pocketable digital gadgets was about 100 Billion dollars in very rough terms. By the time the mobile phone had beaten the major rivals, PDAs, stand-alone cameras and musicphones, by 2006, the total pocketable gadget market had doubled to more than 200 Billion dollars in value, of which mobile had about three quarters. But most of what makes a modern mobile phone valuable to consumers is not the PDA or camera or music abilities of it. There are far more abilies and functions and services that game as additional growth areas, like mobile internet or MMS picture messaging or mobile payments and banking, etc. Our phone today is far more than 'just' a PDA-camera-music-phone.

The same happened in fixed-mobile convergence. The mobile did cannibalize some of the fixed telecoms revenues (and Skype probably took more of the fixed telecoms revenues than mobile) but today, the resulting combined telecoms industry is far bigger, about twice in size. Yet the opportunities did not come from just fixed telecoms services like local and long distance calls and voicemail, or those enabled on mobile. The mobile opportunity developed new abilities beyond convergence, starting from SMS and ringing tones more than a decade ago to augmented reality today.

THE BIG PRIZE 5 TRILLION DOLLARS

So that is what we are fighting for. The value of the different industries today headed for major cannibalization by mobile, where the majority of their business will end in mobile - is worth 5 Trillion dollars. Mobile alone is worth a bit more than one fifth of that, so there is far more from 'outsiders' to 'contribute' to this journey, than for the legacy mobile giants to do

It will be a big battle for this decade and for the banking and credit cards, that will last well into the next decade, but the convergence is inevitable. And do remember, this is not just about smartphone apps, or even about smartphones. Its about 'mobile' as the industry which is the ultimate convergence point and end-state for all digital convergence. That is what we are monitoring here on the Communities Dominate blog..

PS - if you'd like to read more, I have a few thoughts on the lessons of digital convergence up to now here, after the link

Lets talk inputs: Touch Screen and QWERTY

Lets talk about inputs, touch screens and QWERTYs and T9s and hybrids.

We heard earlier this week that Motorola has found 30% of consumers are not willing to consider a phone that is a pure touch screen phone. This number is growing. A few years ago it was mostly only older teenagers and young adults, of whom about half (in the USA, 42%) were so addicted to mobile messaging, that they could send messages 'blindly' ie with the phone hidden in their pocket or behind their back or under the table. That portion (heavily SMS-addicted, tactile text input obsesed) was only about 13% of the total population a few years ago by my measurements worldwide - ie roughly half of the 16-30 year old segment of the total population. But the 'I must have my physical text input' customer segment is growing, and it is now 30% according to Motorola.

SO TO START WITH NUMBERS

Yet statistics also tell us that the sales of touch screen phones are growing faster than QWERTY keypads, and in the top price ranges, in the smartphones - touch screens now outnumber QWERTY inputs according to Canalys. Their numbers tell us that of the 'primary input' of smartphones now Touch Screens are twice the size of QWERTY, while QWERTY are twice the number of basic T9 among smartphones. Both QWERTY and Touch screen keep growing, but in this price range, touch screens grow much faster. I wish Canalys would include the hybrid number (how many have both QWERTY and Touch, because obviously that is a significant number and we don't know where they allocate those. In 2009 NPD told us that 20% of all phones with advanced inputs had both Touch Screen and keyboard. It seems to me, that this form of input is becoming more popular, not less).

But that is the top range of phones. Among all phones, QWERTY is still the primary form of advanced input. I have not seen public domain numbers recently for both, but NPD gave US numbers for 2009, where 26% of all phones had a touch screen input and 35% had a QWERTY input. My company, TomiAhonen Consulting has been tracking these numbers globally, of course, and I'm happy to provide to you my company's current breakdown for end of 2009 is as follows:

All mobile phones sold in 2009 by input method
Touch screen input only ..................11%
QWERTY input only .......................13%
Combo input Touch and keypad .........3%
Basic T9 keypad only .....................73%
Source: TomiAhonen Consulting 2010

(As people have been asking for that number, I will be adding it to next year's TomiAhonen Almanac. The current 2010 Almanac did not have the number as the total number was still so small in 2009 compared to other features of phones that have far larger numbers like color screen, camera, media player, bluetooth, memory card, etc, which I report in the TomiAhonen Almanac 2010)

These numbers are fairly consistent with the tidbits that are coming out like Gartner telling us 184 million phones sold in 2009 were touch screen, and the Indian government saying they have 9 million 'chatphones' ie locally made cheap QWERTY texting phones, LG reporting they sold 18 million QWERTY phones in 2009 etc. Those proportions (13% pure QWERTY, 11% pure touch, 3% combo) are very similar to NPD numbers and also are in line with how Blackberries outsell iPhones; and how Nokia's E-Series (ie mostly QWERTY) now outsells N-Series (ie mostly touch screens)). RIM is the world's bestselling QWERTY phone maker with the Blackerry selling 17% of all QWERTY based phones worldwide in 2009. Samsung is the world's bestselling touch screen phone brand, selling 21% of all touch screen phones. Apple's iPhone took 13% of all touch screens last year.

Touch screens are the hot story now. They also 'seem' more 'modern' and touch screens allow bigger screens in classic candybar phone form-factors (remember, the iPhone is also considered candybar form factor, ie it is not a 'flip phone' or a slider..). So any web browsing and screen-intensive experiences like watching pictures, videos and playing videogames are all experiences more vividly with larger screens. So lets explore this a bit deeper.

We had basic T9 keypads from 1979. It was the only way to control our phones and early mobile web surfing was even driven by the numeric keypad, the numbers on the keypad offered shortcuts to various links on the WAP page. We got the first full QWERTY keypad in 1996 with the Nokia 9000 Communicator. A cheaper and simpler QWERTY layout was introduced by Blackberry and most QWERTY keypads today are of the 'Blackberry style' including many Nokia E-Series phones. Then we had the touch screens. There were modest attempts to introduce touch screens before the iPhone, but we can say that it was not until the iPhone in 2007, that touch screens became commercially viable and popular among users. If it took QWERTY 14 years to reach 16% of all phones sold, and only 3 years for touch screens to reach 14% of all phones sold, it is clear to see the hottest idea in phone inputs today is touch screen.

AGAIN I THINK ITS SIMILAR TO CARS

I do think we have a good analogy from cars, and from PCs. Cars analogy first. The earlier, simpler and more 'labor intensive' way to control the speeds of a car, was a manual transmission. And then a newer, more user-friendly, simpler-to-use, but more expensive way to manage the gears of the car, was the automatic transmission. And a kind of hybrid solution is now the high end automatic transmissions which allow the driver to select the gears, most typified by premium sports cars like Ferraris and Aston Martins having the 'Formula 1" style 'flappy paddle' automatic gearbox operated while holding onto the steering wheel, like a racecar driver...

So which is better? If you 'hate to drive' or are not very well coordinated, then definitely the simple use of an automatic gearbox is far better than attempting to learn to coordinate the clutch pedal and gear lever movements to change gears dozens of times in typical driving situations. If you are a 'real driving enthusiast' like say the reviewers of the Top Gear car program, then they will always prefer a 'real' manual gearbox for real driving pleasure, and most sports-oriented luxury cars tend to offer the manual transmission as an option for this reason. But globally there is a clear gradual decades-long trend where cars are shifting from manual gearboxes to automatics. In the USA most cars sold are automatics and Europe is well on that path too. In cars the automatic option tends to be the more expensive way to do the gear selection (vs manual gear shift) and thus cheap basic cars tend to be sold with manual gearboxes, which is of course the majority of cars sold worldwide, where many of the emerging world markets are the big market opportunities for cars, like China, Brazil, India, Russia etc.

Meanwhile we have another similar shift in the PC world. Originally the PC was controlled by the alphabetic keyboard layout taken from the typewriter (that is where we get our QWERTY style of layout for the keys). The PC added a numeric keypad to the side - early PCs were very heavily used in the accounting and business uses where numeric entry was very important, and the keyboard added the function keys (on top of the alphabetic keys, F1 through F12) which were an early way to offer advanced controls to complex computer programs like WordPerfect. That resulted in the 'classic' 101 key keyboard of the IBM PC and its compatible siblings. Our current laptop computers have keyboards that attempt to mimick that 101 key layout with some size-related compromises (the numeric keypad being 'embedded' into the alphabet keys of UIO, JKL, M<> for example.

Imagine how cumbersome internet surfing would be today if we didn't have the mouse, and had to surf the web using the keyboard only. Or worse, try to edit photographs without a mouse, only using a keyboard. It would be hopeless.

So in 1984 it was Apple who brought us the Macintosh which did change everything about the PC, in terms of how it was used. Among its many innovations, the Mac introduced us to the mouse as an alternate input method. And today all PCs have some kind of mouse input.

But the mouse didn't kill off the keyboard. The mouse and ever more clever on-screen navigation, and context-sensitive menus with programs, did make the function keys almost obsolete but even though the mouse is a great way to navigate websites (or edit photographs), we still use the alphabetic keys of our PC keyboard very happily to do our emails, our blogs, our Twitter comments etc.

Now we are witnessing another dawn of perhaps another era, with the iPad. It has no physical keyboard at all, but offers a virtual keyboard. I am not convinced this will replace all keyboards but it may well become one major alternate way to control our computers.

PHONE INPUTS COMPARED

The three major types of inputs for mobile phones have their own merits each. The T9 form is very simple and cheap. If the user really does not need internet use or any major uses beyond voice and basic text entry, a T9 keypad is perfectly fine. Remember that 74% of all mobile phone subscribers on the planet do NOT use the internet on their phone in any way. If they have a camera on the phone, they won't do significant editing of the pictures, and basic navigation of an image (ie 'zoom' etc) can be done very comfortably with the T9 keys. It would be foolish to attempt to force these customers to accept very expensive touch screen phones to replace their basic phones, before they express an interest and willingness to migrate their phone behavior to more advanced features.

T9 has another benefit, it is very easy to learn. If you have never learned the bizarre order of keys on a QWERTY keyboard - remembering the keys are not in an alphabetic order, so new users have to 'learn' where the given alphabetic keys are - and early use of such a keyboard can be slow - the T9 is very quick to learn. All keys are in alphabetic order and you only have to memorize the location of 8 keys to have the full alphabet. There are many teenagers who are faster at typing on a T9 keypad than they can on a full PC keyboard with its full-size 'comfortable' and dedicated QWERTY keys. This may seem odd, but remember, these are the same kids who can master a videogame with the simpler controls of a Playstation keypad than using the same game on a PC keyboard or for example a 'real steering wheel' for a driving game etc. Simple has its benefits.

QWERTY FOR THE HEAVY SMS CROWD

So then came QWERTY. The early heavy users of QWERTY were wireless email users, as the early QWERTY phones were almost all smartphones, and tended to be very expensive ones. These were used often for email. That then migrated to SMS use and now also for various social networks like Twitter and Facebook, and of course instant messaging users, in particular those using Blackberry messenger. This is what that Motorola finding is all about. Roughly speaking half of older teenagers and young adults are so addicted to mobile phone messaging, that they send over 50 messages per day (a third send more than 100 per day from the USA to UK to South Korea) and at that level, users become so powerful and fast messaging users on their phones, that they learn to send messages blindly, almost without thinking. Many heavy users are able to carry on two separate SMS conversations on two phones using both hands, simultaneously.

These are the seriously heavy users of mobile, and I would say these are similar to the 'serious' drivers of cars, who insist on a manual gearbox even on their premium BMW or Audi. They want to be in full control of their driving experience. So understand this point. QWERTY is not demanded by wireless email users, or of corporate/enterprise business phone users. They could very well adapt to virtual keyboards on touch screen phones. But the current QWERTY addiction is directly related to SMS and mobile instant messaging addiciton of the youth and young adults. While the input method is 'older' than touch screen, and is not as versatile as touch screens can be, for the use of messaging, QWERTY is far better. Like a racing car driver, who wants to be in control of shifting the gears. And then, consider the magic of mobile messaging. Mobile messaging is powerful not only because it is fast, it is powerful even more, because it is so secretive. You can send messages secretly in class. You can send messages secretly from the dinner table, with your hand hidden in your pocket. If you are a teenager and make a call, your mom or dad, or your brother or sister, might be listening to what you are talking about. But with SMS and mobile instant messaging, nobody gets to 'eavesdrop' of to 'snoop' in your communications. This is FAR MORE important than the 'optimal' internet surfing experience.

TOUCH SCREEN

The touch screen, as finally solved by Apple iPhone with the multitouch capacitive screen technology, has now enabled convenient internet surfing on a small screen phone, without a stylus, without a mouse, and without cumbersome keypad navigation tricks. The 'mobile web' use has experienced steady growth since NTT DoCoMo of Japan launched the first full intenet service on mobile in 1999, but the usage was never explosive. Not until the iPhone came along. Today touch screen smartphones, usually combined with all-you-can-eat data plans - are driving internet adoption and use among mobile phone owners. The phenomenon of the App Store and billions of downloads is related to this. It would have been far more subdued if there was no touch screen interface to the iPhone. While the touch screen alone is not as good as the traditional PC with both the full 101 key keyboard and a mouse, the touch screen alone is far better for internet surfing than a keypad or even QWERTY keyboard alone, on a phone.

As we see the mobile internet adoption increasing, that will help drive the demand and appreciation of the touch screen interface.

The touch screen also became the easy way to look at photographs on a phone. Remember again, that for 90% of the population of the planet, who have ever used any kind of camera, the only type of camera they have ever used has been a cameraphone. Don't think of yourself and your luxurious lifestyle who also own a stand-alone digital camera (or if you're older like me, you've also owned many film based cameras). That is a tiny minority of all the camera owners on the planet. The world has now over 2.5 billion cameraphones in use, vs under 250 million stand-alone digital or film based cameras. Touch interfaces are better also for manipulating photos, so as the basic picture editing applications on the cameraphones get better, then here too the users will appreciate the touch screen interfaces to adjust and alter their photos.

The touch screen definitely offers better ways to explore existing pictures but the touch screen is also cumbersome as a camera operation interface. Most touch screen cameraphones offer at least some controls on separate 'dedicated camera buttons' on the side of the case, like the shutter button. But for things like zoom and flash setting and lighting control etc, touch screen controls are a severe compromise when compared to dedicated camera buttons. This is where 'general purpose' cameraphones will be hurt and 'serious' cameraphones will offer more dedicated buttons and controls. Its one reason why 'slider' form factors for advanced cameraphones with touch screens are very viable.

So with cameras its a mixed bag. A pure touch screen is not optimal for taking pictures, but large screens are better for watching pictures and pure touch screens can be excellent for the sharing and definitely touch screens better for exiting photos than non-touch screnes.

The virtual keyboard on the touch screen is also good enough for most users. Remember that even the heavy SMS addicted part of the population is only 30% of all consumers, so we have 70% of the population who are not that bothered. If they need to send a message, the virtual keyboard is definitely 'good enough'. For many who have learned to type of a PC, when 'upgrading' from basic T9 to a good touch screen virtual keyboard like that on the iPhone - they experience a significant increase in typing speed. The virtual keyboard is better than basic T9, and that is most definitely good enough for most typical users.

But the virtual keyboard obivously consumes a large part of the available visible display. That means that the available display is limited, so the users see far less of the messages or twitter feeds or emails or blogs etc that they are reading about and writing to respond to. It is a compromise. The more severe problem comes from 'single handed' operation. Most users of touch screen virtual keypads are not dexterious enough, with very fine-tuned muscle memory, to be able to type on the virtual keypad single-handed. The virtual keypad is designed to be used on a stable surface (like the table at a Starbucks) and with the typing done with both hands. T9 and most QWERTY physical keyboards can easily be operated single-handedly.

This is not a big factor if you are using your phone primarily in a seated situation, like in meetings at the office or in yes, coffee shops and the airport lounge. These are typically not the young addicted users (called 'digital natives'), they are typically the older 'digital immigrant' type of users who are trying to shift their experiences from the PC and internet world into the mobile world. For those who are fully addicted to the phone, they use the phone continuously - young adults will look at their phone more than once every 5 minutees of every waking hour of every day - and will be using the phone while walking. So the user will have other things in the other hand, like the bag with the school books, or a brief case, or an umbrella, or the grocery shopping bag, or perhaps holding the hand of the child on the way back from kindergarden, etc. These users keep using the phone in one hand while they move about in their day, and they will want the ability to fully control the phone single-handedly. A pure touch screen phone will be cumbersome, and at times impossible to use this way.

BOTH INPUTS

Like the flappy paddle 'professional racing driver' control of modern top sports cars, that allow both an automatic transmission and the control by the driver, a phone input where both touch screen and keyboard entry are used, is the ultimate top-of-the-line that answers both needs. It allows totally dedicated keys for keyboard-intensive uses like text entry or camera operation; while including touch screen use for internet surfing and picture viewing. This is the most expensive solution obviously, it means the phone software has to understand both forms and most applications on the phone have to recognize both types of inputs (logically, consistently, intuitively). The input methods will have a lot of overlap, so there is redundancy here that is perhaps even unncessary costs for some users, and the technical solution means the phone will be far larger physically than one with only one or the other.

The form factor means either a severe compromise on the screen size (to maintain candybar form factor) or else a more expensive and bulky design with a flip or slider configuration. A physical keyboard added to a touch screen means that your phone will not be as slim as the current iPhone model for example, and for many that bulkiness is a sign of being old-fashionied. It also adds weight and cost. But inspite of this, I am confident this category will grow to take a far bigger part of the total handset space, because many SMS addicted users will want to 'also' have a big touch screen, and then, perhaps less so, some existing touch screen users will develop a desire to have a dedicated QWERTY keypad as well.

WHAT OF SWYPE

And yes, just like we had the predictive text innovation to try to solve the 'problem' of T9 text input (heavy users tend to turn predictive text off, so its a typical crutch for those who were not born into the digital world), we now have the great idea of Swype, as a solution to allow 'lazy' touch screen text entry, swiping, with approximately the right characters, and Swype will use its intelligence to guess what word you meant. This is another very intelligent solution to solve a problem using automation. Some will like it, others will hate it, just like predictive text. The problem with Swype is that you have to learn how to use it. It doesn't take long to learn but you have to go through that process. Many who have gone through it, say their text entry is lightning-fast and accurate on the touch screens. Fine. My gut says, we won't get everybody to bother to learn a new way. It is a nice crutch, but my guess is that for the heavily addicted texting users, they won't bother. They use so much of the cryptic shorthand of SMS communication culture (and the ever-changing jargon of the youth and pop culture), that they'd need to be constantly updating and correcting the library for Swype. Maybe I am wrong, but we have to see, I am not expecting the world to start to use Swype, but I do see it as a good solution for many who do have a touch-only smartphone and want to get faster typing on it.  

WHAT OF VOICE INPUTS?

Yeah. That old story yeah.. I do think that in the long run we'll get to major voice inputs of all of our digital devices. The intelligence of voice recognition is getting better, but its slow going. Note that for most uses of our phones, voice input is actually not optimal. If you are sitting in the Starbucks, how quickly will your neigbors get annoyed if you try to navigate your mobile phone activities (or your laptop or your iPad) using voice inputs. How many times would you get errors of inputs in loud places like the airport or train station. How many times do you want to control your phone quietly - sending a discrete message to your wife from the meeting, that you are running late.. So even if voice inputs were to be perfected (they are nowhere near there yet), then voice inputs are going to be only a partial solution. So think of the user in the car. If you commute to work every day in your car - alone - then it doesn't matter at all to you, if you speak to the phone and it speaks back to you - reading your messages to you etc. But if you are car-pooling and there are 4 colleagues in the same car, it would be pretty impossible for all 4 professionals to use speech controls on their phones in the same confined space of the car. Or consider the train or bus, even more of a hassle.

I do believe we will get ever more clever uses from voice controls - and from text-to-voice reverse uses, of voice as the output (great when driving a car, when you can't take your eyes off the road to read messages, but you can listen to messages if they are read to you). But at least for the near future, next several years, I do not see voice inputs or outputs as the main inputs and outputs of your phone behavior. A growing area yes, but a minor solution to inputs (and outputs), not the 'ultimate' solution. Just look at Star Trek, with their clever talking computers haha, even there the crew regularly had to input commands using the touch screen keyboard entries, where a voice communication would be far more complex than simply touching with your fingers..

THE CASE FOR THE CASE 

We do also have the curious case of the case. The iPhone Death Grip antennagate brought to light the issue that many iPhone owners buy their smartphone with a case (and now the official Apple solution to iPhone 4 Death Grip is to give away a free case with a new purchase). This to me was something I never appreciated, as I have never particularly liked cases with my phone(s). I carry my phone in my pocket. But it occurred to me a couple of days ago, that since I use my Nokia E90 Communicator as my primary phone - and it is a 'palmtop' style flip phone (ie wide flip) - that is not suited for most basic cases. A case is most suited for a candybar form factor like on the iPhone. The same is true of many of my past phones like the N93 contortionist phone or the N80 slider, and obviously all my previous Communicators too.

MANY FORM FACTORS TO CONTINUE

In the laptop PC world, the original Toshiba T1000 laptop from 1985 is very clearly the forefather of modern laptops, notebooks and netbooks. There was never a major rival form factor (until now, with the iPad and tablet PCs). Fro 25 years the laptop has held a very standard flip laptop form factor, the big screen on the lid and the full QWERTY keyboard on the bottom part of the flip construction.

In mobile phones we sell numerous popular form factors today. We sell the basic candybars, sliders and flip phones, with T9 inputs, QWERTY inputs and touch screen inputs, or a combination of the above. This reflects the different major types of customers of phones, and the major 'primary uses' of phones today. For some it is primarily an internet access device. For others its primarily a messaging device. For others still it is primarily a camera. And for many older users it is still primarily a (voice) telephone. How you use the phone - and your previous history with other inputs like using a PC or using a Playstation - determines what kinds of inputs you will prefer. There won't be one overriding form factor for phones. Not for many years to come. But expect touch screens to grow the fastest right now, as the phone makers learn from Apple on how to do touch screens well.

Thats my thinking about Touch versus QWERTY today. I am interested in your views and this is obviously an area that is evolving.

This is now BAD news for Apple, as Consumer Reports won't recommend iPhone 4, finds death grip to be proven

Guys, I do NOT hate the iPhone or Apple. I told you in my iPhone 4 review that it was the best iPhone yet and a big leap forward. But I am tracking the smartphone wars this year, and have to report all the major facts. And this Consumer Reports incident is now a major fact. Now that 'death grip' story has been escallated very very badly for Apple.

APPLE SPINS STORY, IS ONLY DISPLAY GAFFE

So what do we know. First some early technology blogs started to report that holding the iPhone 4 could cause the signal to be lost (ie dropped calls). Then the story got some media attention, and Apple's CEO Steve Jobs made an uncharacteristically non-elegant (for Apple's smooth PR machine) gaffe, suggesting iPhone 4 owners should hold the phone differently.

Then as the complaints continued, Apple issued a formal statement about it, suggesting the error was in the display of the network connectivity bars on the display of the iPhone - that Apple had been calculating wrongly the display. So Apple suggested there was no technical problem in the antenna design, that it was a display problem where the connectivity indicators would decline while the connection was still strong. Sounded plausible and it seemed like the story was going to be over. Meanwhile Apple suggests consumers can buy the 30 dollar rubber bands to cover the sides of the iPhone (something many complain is not the responsibility of iPhone 4 owners to spend more to fix an Apple error)

CONSUMER REPORTS VERIFIES DEATH GRIP

Now we have the most trusted and neutral US consumer products reviewer organization, Consumer Reports, which has tested the iPhone 4 and came with a devastating conclusion. They were able to verify in laboratory conditions that blocking parts of the outside of the iPhone 4 would cause a 20 decibel drop in the connectivity on the AT&T network. They also tested other phones and found that for example the iPhone 3GS did not have this problem. Therefore, Consumer Reports ends the review that this problem is so signficant, it causes so severe consumer problems, that the iPhone 4 is 'not recommended' and they suggest buying the older iPhone 3GS instead. See the story at Into Mobile who entitled their story as 'Liar liar pants on fire'

This is now escallating the problem enormously. We now have tons of parodies and jokes on Apple's death grip, even UK car show Top Gear used the death grip to poke fun at their test driver 'The Stig'. The iPhone 4 is becoming synonymous with death grip phones, much like Toyota became synonymous with cars without brakes.

First, this is very bad image for Apple. They are caught with lies. They said in public that the problem with the iPhone was the display of connectivity. Now Consumer Reports verifies that a - the iPhone 4 does have an antenna 'death grip' problem - that it is so severe it will kill phone calls - and this is not typical of all phones, for example Apple's own previous phone iPhone 3GS does not have this problem. So Apple must have known about it. And yet they issued that ridiculous statement that 'its only in the display'. They are caught with lies to the industry, so Into Mobile's conclusion - 'Liar liar, pants on fire' is justified - and very uncomfortable for Apple. How can the smooth and PR savvy Apple fail so badly with this kind of error. This certainly looks a bit like an Apple 'Toyota moment'.

Then come the demands for recalls. I was surprised to find how many very high profile PR gurus are already weighing in on Apple's iPhone 4 Death Grip problem, and saying the only way to get past this, is to do a total recall, fix all the iPhone 4's and obviously do it for free (rather than demanding all iPhone 4 owners buy a new 30 dollar rubber band to cover the problem). Just the rumors of a recall have Apple shares taking a severe decline.

BUT NOT ALL iPHONES EXPERIENCE IT

So I was watching Bloomberg news and there was a Consumer Reports person being interviewed and I think it was very revealing what was said. The man said he had used the iPhone 4 at their office right after they got it, and he was unable to replicate the problem. And he was already willing to accept there is no systematic problem. Then he took his iPhone 4 home and found the problem intermittently at his home. And then when Consumer Reports did their lab tests (on 3 separate iPhone 4 models, bought from 3 separate outlets) they were able to verify the problem and measure it. The 'death grip' will not 'eliminate' all connectivity, it will dramatically reduce the connection - ie by 20 decibels. So if you are in a very well connected location (strong signal) then even after your iPhone 4 suffers 20 decibels of signal loss, you still will maintain enough of a connection to carry on a call and never notice the problem. But if you are in an area of weak or modest connection, then the 20 decibel decline will result in a dropped call.

That is why some users experience the death grip often - and find it infuriating - and others find it rarely - and considering how lousy the US networks are (AT&T hello?) - will just think its 'normal' network drops, and not even really personally notice the death grip, thinking it was just a 'standard' dropped call incident. Obviously this will be far more - FAR MORE - observed and hated phenomenon in all the countries with perfect cellular networks, like in Japan and Europe and Russia and China etc haha..  Where dropped calls are nearly non-existent, any Death Grip' incidents will be immediately spotted.

IMPACT TO APPLE

First, there is an immediate short term PR disaster. The best thing for Apple to do now, is to immediately confess up to it, to promise all buyers an orderly and free recall with a fix, and obviously halt sales of faulty iPhone 4 phones while that problem is fixed with the millions of phones in the pipeline. Then issue an iPhone 4B or whatever clearly identified 'fixed' version. This would obviously be a very costly PR nightmare and hit Apple profitablity and also hit iPhone 4 sales severely. It would be a big gift to the rivals, in particular the Android phones - and buy time for Nokia to release the N8 and RIM to release its touch screen/QWERTY Blackberry.

The more likely way forward by Apple - judging by recent past - is to 'fight it' and deny and use the old tired spin of PR to fight it (I saw some Twitter comments that Apple is now removing some forum postings which mention the Consumer Reports story?) This is classic outdated Cheney-Drumsfeldian spin doctor approach - deny deny deny and fight the story. The modern Web 2.0 world won't put up with that, and if Apple doesn't understand that soon, they may have something far worse than a 'Toyota moment'. If they go against the Blogosphere and Twittersphere and the social networks, they would have their 'Kryptonite moment' ie Toyota moment (failing brakes) only hurt Toyota profits and market share. Kryptonite (denying that their locks were not secure) nearly bankrupted the whole company. Similar to the Sprint 1,000 moment for Sprint-Nextel, which still today is hurting the company's competitiveness and devastated its market share to the point of the CEO, CMO and CFO being fired.

The conclusion is clear - its a fact that there is a Death Grip problem with the iPhone 4. It can not now be denied. The longer Apple denies it, the more foolish it will look. The longer Apple delays its free fix, the more the world will hate Apple for it. And where the US market has been kind to Apple so far, the rest of the world will not be as kind, most of all, because the Death Grip will be far more easy to verify outside of the USA. So the longer Apple delays its apology, the more all types of news organizations and tech sites and consumer support organizations will test - and verify - the Death Grip and cause more bad publicity for Apple.

IS STILL BEST iPHONE

Now, what of the actual sales? There is a hungry lot of 20+ million users of older iPhone 2 and 3 models, whose contract is up now or soon, who can't wait to get the latest iPhone. They won't buy the iPhone 3GS, and they will love the iPhone 4, which is such a huge improvement over the iPhone 2 and iPhone 3. The iPhone 4 will sell very very well to existing Apple users, the loyalists. And they have no problem either adjusting their grip - or more likely - to pony up the extra 30 dollars and buy the colored rubber band solution. 

The problem for Apple's growth is that it needs NEW users to buy the iPhone 4 now. They NEED growth, to try to match the growth that RIM is having, that HTC is having (and Nokia is having) and the astronomical growth rate of the Android family of smartphones (which already sell more than iPhones globally). This is NOT the time to have a problem - and Apple's problem is FAR worse than any with smartphones by Nokia or RIM or HTC or Samsung or Motorola - as Apple only has one new phone model per year (something I have been urging them to change for more than 3 years now, they need more than one model - do not put all your smartphone eggs in one basket, Apple, please spread your product line to more than one model, please!)

So if Apple halts its production to fix this, that would be devastating market share crash for Apple, right as the company formerly known as Apple Computer now calls itself a mobile company. The iPhone drives most of Apple's revenues and most of its profits. If its only iPhone model falters, Apple is deeply in trouble.

One more angle - remember many iPhone 4 buyers had to 'order' their smartphone and had to wait for delivery. Yet this problem was discussed right from the launch. Some buyers of any goods (cars, TV sets, phones..) will experience 'buyer's remorse' ie they are not sure they bought the right product, after they have the new gadget in their hand. Three years ago, there was no rival to iPhone's multitouch touch screen and its great internet access. Now most Androids can match the user experience (to common users, obviously tech geeks will find finer points where Apple continues to lead). There always are returns for any phone model. But this time, with all the negative publicity about the Death Grip (and often other gripes a given expert may have about the iPhone 4) - I am afraid this will be the most returns Apple has ever had with its iPhone models. In that way it could be like Motorola's Razr moment, when parents loved the Razr, bought it for kids, who hated it (because you couldn't hide the phone under the sleeve and send SMS text messages blindly). The Razr was one of the most returned phones of any major Christmas launch of a phone and it stunned the sales departments of various operators/carriers as tons of Razrs were being returned, and the buyers asked to replace it with a phone by some other manufacturer like Nokia, Samsung, SonyEricsson etc (and always the flip phone was being replaced by candybar phone factors). Later as we studied the issue, we found they were almost all Razr models given as gifts for kids. Parents loved it, their kids hated it..

The longer Apple denies the problem the worse it will get. If Apple doesn't want this to be the start of the end for the short reign of the iPhone, its time now to confess, to apologize, and to do an immediate global recall of the iPhone 4, to fix the antenna and end the death grip. Come on, Apple, you are a good company caring for your customers aren't you? You know it was a faulty product that should not have been launched. Its not like there aren't bad smartphone launches, we've seen Nokia stumble with the N97, Google fail with the Nexus One and Microsoft do a rapid exit with the Kin. The sooner Apple admits and fixes this, the sooner it can return to the image of being the hero and leader of the consumer experience in smartphones. They could turn this disaster into an opportunity. But the clock is ticking..

Whats Latest in Mobile Advertising, from MMA Global Event in New York City

I had the honor and privilege to present to the MMA Global event in New York City where I gave the first keynote of day 2. I was asked to present magical mobile marketing examples from around the world, featuring both sides of the Digital Divide (more about my presentation in chronological order here below).

As luck would have it, my flight arrived very early and I was able to join Day 1 nearly from the beginning. And I stayed for the full 2 days of the event, and made meticulous notes of all presentations. I was stunned to find at the end, that I had made more notes of this event - which indicates innovations and relevant updates - than any other event in mobile that I have ever attended before in my over 260 public speakerships in over 40 countries on all six inhabited continents. Noting that those include the biggest telecoms event of North America - the CTIA, the biggest telecoms event of Asia, CommunicAsia, the biggest telecoms event of Latin America, Andicom, and the biggest telecoms event in the world (and of Europe obviously) - the Mobile World Congress - this 2 day New York event arranged by the MMA was something quite exceptional. I promised to blog about what I had found noteworthy.

I also want to mention two very fascinating observations. First, that as mobile advertising is quite old as a concept - I chaired the world's first mobile advertising conference (held in London by the WAA the Wireless Advertising Association, which later merged to form part of the MMA) almost ten years ago - we've seen mobile advertising and marketing experience a slow growth through most of this decade. Certainly its innovations and revenues and market successes have been in the shadow of ringing tones and videogames and news and social networking until very recently. Mobile advertising for most of the past decade has not been particularly innovative. That has now changed radically, no doubt most of all propelled by the USA-driven global advertising industry, which was awoken only after 2007 when the iPhone hit the pockets of every self-respecting ad man and mad man (and -woman).

Secondly, one would be forgiven to assume, that a mobile advertising and marketing event held in the USA today, would be filled with iPhone Apps hysteria (the iSyndrome, as our friend Martin Wilson calls the mistaken notion that building an iPhone app translates into a mobile strategy haha...) and location based advertising hype. And that the American audience would not be offered a view into the true mass market reaches of SMS, MMS and WAP. Yes, one might think that. But this was an event arranged by the MMA, the Mobile Marketing Association. They are professionals. They know their stuff. And yes,  SMS, MMS and WAP were regularly mentioned, and even more reassuringly, many speakers emphasized the point, that while advertising clients (the 'brands') often requested iPhone apps in first meetings, the reality is today for MMA members, that even in the USA, they run mostly SMS, MMS and WAP solutions for most mobile advertising and marketing uses, and apps are - as they should be - a minor element for the premium smartphone segment where they can add value. And as to location based ads, there was very little mention of this other overhyped proposition.

I missed the first keynote of by Soledad O'Brien of CNN, and I walked in almost at the end of the second presentation by Mike Steib of Google. I don't have any notes from his presentation. But after that, I was there the rest of the event. Lets go in chronological order the most interesting items that I made notes of.  (I am not going to mention every item I observed.)

ESPN

The US sports broadcasting network ESPN had Sr VP of ESPN Mobile, John Zehr present. He told us about 'Citizen Scoring' ie as ESPN sends a TV crew to televise about 2,500 live games per year, there are another half a million live junior, amateur and youth league games of some sort. These don't get formal scores into the digital record of their sports. So ESPN has set up a platform to allow fans or supporters of these games and leagues and teams, to post the official records of these games. Thus when a future professional superstar emerges, we'll have a digital record of that star's junior career all the way to first public games etc... Clever, and very 'Communities Dominate' kind of thinking over at ESPN. John called it 'structured user-generated content'.

John also told us that Dunkin Donuts has run a campaign (similar to the Lays potato chips campaign in India) where customers of DD were asked to submit ideas for a new donut flavor. The suggestions were submitted via SMS of course.

MMA NORTH AMERICA

Jack Philbin who is co-chair of MMA North America, told the Track 2 audience that the Chicago Blackhawks mobile fan club (that I have discussed before) went from 25,000 fans to 75,000 fans in one year - and this was before the Hawks won its Stanley Cup, so today that number is likely even bigger - by the way, congrats to Finnish goalie Antti Niemi for becoming the first Finnish ice hockey goalie to get his name on the Stanley Cup, and the 8th Finnish hockey player across all time.

SYBASE 365

Sybase365 is the mobile arm of the database IT giant Sybase, that was just bought by SAP a few weeks ago. Cameron Franks the Sr Director at Sybase 365 presented in Track 2. He told of a really cool innovation by Rite Aid the pharmacy in the USA. They have regular plastic electronic card based loyalty cards like most major retail chains. But they have now allowed their loyalty card holders to register a cellphone number as the alternate loyalty card, and can use the phone numbers as their loyalty card, so they don't need to carry the plastic card in their wallets anymore (and have the loyalty card always with them obviously through the phone). This in itself is of course great utility to custmomers, but now Rite Aid can also send targeted messages via SMS such as offers and reminders if a prescription is running out, etc.

Cameron also told us of a Blockbusters UK video rental store campaign stats, that over 1 million rentals related coupons have been delivered (discounts, free drinks offers etc) and 100,000 of those have been redeemed ie conversion rate of 10%. Cameron pointed out that with paper coupons, all any company can do, is to validate the paper coupon itself (that it is not fraudulent) but with mobile coupons, of course the coupon itself can be validated, but so too can the customer using the coupon, be validated. Very powerful improvement over paper.

WEATHER CHANNEL

The Weather Channel has for many years had more total web usage in the USA coming from mobile users, than PC users. But now Cameron Clayton, the VP Mobile, gave us unique audience numbers which I think were very revealing. On TV, the Weather Channel gets a unique audience monthly of 119 million. On the PC, they get 42 million. On mobile they get 22 million. And on the iPad they have 520,000. Cameron also made a funny statement, that the Weather Channel is America's largest locatoin-based ad platform (obviously all weather forecasts they show is local ie typically TV will show weather for any city). He also said that their mobile use had 'struggled' until the iPhone came along, which 'changed everything' (haha, sounds like my original blog here before it launched, forecasting iPhone's future impact haha)

MTV

After lunch we had Salomon Masch the Director Mobile & Emerging Media for MTV. He said that while MTV has tons of video format content for mobile, 90% of all mobile advertising on MTV is WAP banner ads. He also told us that they have now adapted (MTV property) Comedy Central's The Daily Show with Jon Stewart - a 30 minute daily news parody show - into a daily 60 second mobile summary version. (I want that on my phone haha...)

ANHEUSER BUSCH

The US brewer of Budweiser beer, Anheuser Busch, had Todd Masinelli, the Sr Manager Digital, tell us about the Text Cruise to Beers contest, which is now in its 3rd year. Their Bud Light (light beer) brand has a text-to-win contest where they fill two cruise ships of contest winners on a monster party which ends on a private island with a surprise superstar rock band delivering a private rock concert. All the beer you ever wanted to drink on the cruise of course. Only way to get in, is if you text and win. They have a multi-platform campaign in all types of media, both nationally and locally where legally allowed, to drive Bud Light drinkers to try their luck in texting to win. The campaign runs from May 1 to December with continuous reminders and opportunities to reconnect with the brand along the way, while awaiting the announcement of the winners.

RG/A

The award-winning NY based global digital agency, RG/A (which I mention often in my books) had my friend Richard Ting, their VP & Executive Creative Director Mobile and Emerging Platforms, on a panel (I wish we'd have had a full presentation from Richard, his presentations are always worth their weight in gold). On the panel he responded to one question telling the audience that 2 years ago, RG/A had globally only 5 dedicated mobile specialists. Today their mobile competence has grown to 85 people. That to me is prefect evidence of how much increased attention the advertising and creative agencies are now focusing on mobile, and obviously reason why so much innovation is now happening in mobile advertising and marketing. Richard also said in another reply, that their clients often now know to ask for mobile, but don't know how to do mobile.

ISOBAR

Gene Keenan the VP of Mobile Strategy at Isobar, told of how they set up Adidas's campaign around the London Marathon. They offered all supporters of the runners, the chance to monitor the performance on mobile, plus to send personalized messages to digital billboards at given intervals at the marathon (ie any runner would see messages directed at them, correctly on time, when they approached the billboard). The total traffic yieded one half million SMS text messages during the London Marathon.

MMA BATTLE OF REGIONS

Then the event had a fantastic way to end Day 1, with a 'battle of the regions' where the Managing Directors of 3 regions of the MMA went head-to-head in a debate of whose region was best in mobile advertising and marketing. Michael Becker represented North America, Paul Berney Europe and Africa, and Rohit Dadwal Asia-Pacific. The audience (they had over 700 signed up to the event by the way, MMA's biggest event ever) voted using SMS. Each of the speakers had prepared short fact filled presentations for their regions, and we voted out one to give a final between two, and then saw more presentations for those, to then pick the winner (Paul won it). There were many really great stats and case examples that these 3 MMA veterans showed us, including several that are familiar to regular readers of this blog. I will only pick a few of my personal faves here.

In Turkey, Lipton Tea ran a campaign on ringback tones. Had 250,000 signed up. Grew Lipton sales by 47% (wow! Ringback tone advertising is VERY promising and Turkey has been an innovator in this space for a while now. Still, I was VERY impressed)

In the UK, the Ariel detergent brand had a campaign which hit 400,000 housewives using SMS and achieved a 20% response rate which generated footfall to the stores.

A TV ad (I think it was in the UK) for Wiskas cat food using SMS achieved 100,000 ads delivered and drove Wiskas sales up 30%

In South Africa, a florist chain named Sasko Flowers, ran an SMS campaign that resulted in 20% response rate.

That 'mosquito noises' campaign by Fanta that I have shown religiously for the past year as magical and fun, out of the UK, was revealed to have generated 600,000 downloads (cool, so there are about 1.2 million parents and several million teachers, who never hear those sounds while the kids play with their phones haha).

Our regular readers know intimately the award-winning BMW winter tyres MMS campaign with 30% conversion rate. I was happy to see it mentioned too, although I didn't learn anyting particular from that one haha..

The AXE virtual Wake-up girls, another of my faves right now, out of Japan, generated an increase of sales of AXE deodorant for young men, of 300%.

Out of India comes the 'Condom' ringing tone campaign, aiming to reduce Indian men's reluctance to use condoms, educate about contraception and AIDS awareness. The very funny campaign won CNN's award as best educational mobile campaign of the year, and drove condom awareness up 10% in India.

In Kenya its now possible to post savings to a funeral insurance account, via SMS.

And once again amazing milestone from Estonia - Estonia became the first country this year to allow citizens to post their tax return via SMS (don't we wish that was available in every country immediately? Ultracool) - Correction. A reader, Arild from Norway pointed ou t that Norway has offered this facility since 2003, so Estonia is no the world's first to do this.

The Puma F1 multiplayer racing game from China that I have often talked about has now usage stats - it achieved 200,000 downloads of the advergame, resulted in 300% increase in Puma sales in China, generated bonus interactions with the brand through ringing tones nad wall papers, and was so successful it forced rival Nike to react also on mobile in China.

TOMI T AHONEN - MY KEYNOTE

My keynote started Day 2. I gave 9 service examples across the digital divide, using my 8 Unique Abilities of Mobile as the framework for the case studies. As I have a tendency to do, I started first with some statistics such as that in India 33% of all messaging received by consumers is machine-originated, ie is media content, advertising, alerts or other marketing messages. I showed the stat that in Africa the average user looks at his or her mobile phone 82 times per day. And that in China of all paid newspaper circulations, paid mobile daily news updates on MMS and SMS have cannibalized 39% of the total paid readership.

I then used my line 'mobile is as different from the internet, as TV is from radio' and illustrated that when radio gave way to TV, all radio content was also replicated to TV, after which TV invented new formats you can't do on radio - like music videos - and that today TV revenues tower over those of radio. And that mobile will be exactly the same, it has already cannibalized all internet content in some way or another, it has already invented formats that are not viable on the web - like ringing tones - and that already today mobile data is bigger by revenues than total internet revenues.

Then I used the 8 Unique Benefits of mobile to showcase mobile advertising excellence, switching between the least advanced markets and the most advanced markets across the digital divide. For unique ability 1, personal, I mentioned the Australia stat that one in three spouces will spy on their partner's phone - and mostly do this while we are in the shower. My service example came from South Africa, the free Call Me service I have often talked about.

The second unique benefit of mobile is permanently connected. I quoted the UK stat that more than half sleep with the phone ringer left on, so SMS will literally reach us even in our sleep. My service example was the Guinness Sevens Rugby tournament app from Hong Kong, which includes game scores etc, includes tourist maps and of course bars serving Guinness, and that magical ability of the simple tourist translator, where the phone user clicks on an English phrase, and the phone speaks it in Cantonese - from take me to my hotel to may I have a Guinness to 'whats a pretty girl like you doing in a bar like this' haha... I also added my recent finding that this app increased Guinness beer sales by 25%

The third unique benefit is always carried. I quoted Finnair mobile check in stats that over half of fliers on short haul business routes now use the service. Then gave the example from Poland of the Knorr soups MMS based cooking guides, prepared by Poland's top TV chef.

Unique benefit number 4 is mobile payments as we know. I listed Kenya's latest number - that now their mobile banking accounts exceed traditional banking accounts (the first country to pass 50%). And as my service example, used the power of mobile to bring digital interactivity to non-interactive media, in the Coco Presso billboards campaign using NFC in Japan (where instant discount coupons can be redeemed at vending machines which are located literally next to the billboard advertising)

For unique benefit 5, creative impulse, I quoted that stunning UK youth stat, that 10% of british young adults think its ok to send SMS text messages while having sex (and for those who didn't know, obviously these young adults can all send SMS text messages single-handed and blind, so the phone may be behind the pillow for example haha). And my service example came from India with the Lay's potato chips campaign where India consumers were invited to submit ideas for new flavors. The four finalists are currently in test market after there were more than a million SMS text messaging based suggestions. The winner will get among other things, 1% revenue share of every bag of chips that new flavor will sell.

For unique benefit six, most accurate audience measurement, I quoted the AMF stats we know well here, mobile most accurate. My first example was Japan's Otetsudai networks (help wanted ads location-based service with full e-commerce etc). Then I showed the same concept can also thrive in simple tech markets, using Babajob from India where a similar service was deployed on SMS, WAP and IVR, and the addresses were manually entered by the prospective job seekers rather than automatically using the location data.

For the 7th unique benefit social context of consumption, I quoted the slightly older Jupiter stats that two thirds will try something recommended by a friend while also two thirds will forward something that they like. I used the Puma F1 race as my example - this was the only service example that I used of my nine, which had been mentioned by someone else during the two days. But I pointed out that when Rohit Dadwal of the MMA had shown the Puma F1 game, he talked of its user numbers. In my keynote, I focused on the viral aspects (social context) of the game which was also very clever.

For the 8th unique benefit, Augmented Reality, I quoted the stats on mobile virtual goods being worth 2B dollars this year, and mentioned Layar of course as the archetypal AR service. But for my AR service example, I showed the Adidas T-shirt campaign from Singapore, and illustrated to the audience how we've now moved from observational 'third person' AR to participatory 'first person' AR.

After the presentation (there was a sound glitch which caused me to run a bit over) there was the autographed book give-away of one copy of my latest hardcover book,Mobile as 7th of the Mass Media, and a rare print edition copy of Tomi Ahonen Pearls Vol 1: Mobile Advertising (it is only sold in ebook format). We ran an audience quiz of first, which country has the highest per-capita rate of mobile phones (UAE is the first country to pass 200% rate) and then where was TV-interactivity invented (the UK).

Of my presentation, based on Twitter commentary, the items that most struck the New York audience were the China 39% migration of newspapers to paid MMS/SMS news alerts, the 10% UK texting while having sex stat (of course haha) and that in India 33% of SMS is media content and/or advertising. Also the Q&A contest stat of UAE having 200% penetration rate got a lot of Twitter mentions. And I want to particularly thank Jeff Hasen, the CMO of Hip Cricket, who tweeted each of the 8 Unique abilities of mobile in its own Tweet with nice brief summary of that point and related facts.

ELECTRONIC ARTS

Returning to my notes, then we had Elizabeth Harz the Sr VP for Electronic Arts (better known simply as EA the world's biggest videogaming company). She told us that EA Games has already 50 games with a 'Lite' version, where the full capability total gaming experience is given for free on a game version that has only a few levels - those who want to play the full game will need to then buy the upgrade to the rest of the levels, or other such business models.

ALCATEL - LUCENT

Then my friend Thomas Labarthe the VP of Mobile Advertising for networking equipment makers Alcatel-Lucent, was kind enough to state that their mobile advertising platform was developed based on my book Mobile as 7th of the Mass Media (thank you so much Thomas!). He further kindly attributed to me my thought that in mobile we are witnessing the third evolution of mobile advertising, the first was copying existing formats from legacy media, the second is the current interactive advertising, and the new, mostly still emerging wave, is engagement marketing.

Thomas talked of the need to have clear opt in, to be transparent to end users, and to have clear and simple opt-out options. He said something also very perceptive as we ponder 'who owns the customer' haha, Thomas said 'the customer owns the customer.'

BLYK

Then we broke into streams again. I was in Stream 2, where our dear friend Antti Ohrling, the co-founder of Blyk was on a panel. (I would compain bitterly of this injustice, as Antti has forgotten more about mobile advertising than the rest of us have learned. Yes, normally Antti Ohrling should be doing a keynote of course. Except that Antti was actually used to run a workshop before the conference, so those who wanted, had received a lot of Antti's insights.) Antti told the room that in mobile the need for privacy increases 10-fold. He said traditional media had been living in a static model of segmentation, but in mobile we have dynamic segmentation ie our behavior can easily change in very short cycles, - it is possible for one person to exhibit alternate behavior several times per day, being a business professional, then a parent etc in the same day. Antti also told of a banking case in the UK without naming the actual bank, obviously, who had used Blyk to target youth first time bank accounts. When they ran their first campaign, the response was so enormous, that the bank's calling centre crashed..

COCA COLA

Then Coke's Tara Scarlett, Sr Manager CRM, told us that the consumer today has 3 times more choice in convenience store branded items than just 30 years ago. We are now facing hyperchoice. She also told of the Coke SMS campaign of Twist, Text and Win. It was supported across multiple platforms and media, but the purpose was to drive sales of Coca Cola bottles, where under the bottle top, there was an SMS code to win prizes.

CDC

The Centers for Disease Control had sent Holli Seitz, the Presidential Management Fellow to tell us about their pilot project in mobile which they now are expanding. I particularly noted the stats that even on such a sensitive issue as the government asking for personal data related to our health, 70% of their registered users, were willing to take a 3 question survey on the phone, asking for their age, their sex and their zip code. (obviously data which is very relevant to diseases..)

KODAK

Finally we had the CMO of Kodak, and bestselling author Jeffrey Hayzlett give a most dynamic and energetic and funny and emotional final keynote, based loosely around his book, The Mirror Test. Jeffrey said that photographs were the kind of property that regular consumers will run into a burning building to save. He also mentioned - very Communities Dominate haha - that the value of pictures increases when they are shared.

Ok, that was the best highlights of the MMA Global conference in New York. If they release a video of my presentation, I will blog about it and add the link also here of course. Thank you MMA for a truly wonderful event with a fantastic lineup of excellent speakers. I had a wonderful time.

The Twittering Cows, seriously.. using Twitter in milk production in Canada

Those who saw me speaking in public in 2002 remember my highlight joke, the world's first mobile phone connected cow. My friend Mark Weisleder of Bell Canada had told the story of the world's first bovine with a cellular subscription - the lead cow in the herd had a beeper around its neck, and knew whenever the beeper started to beep, it was time to come to the farmer, to be milked. And the rest of the cows would follow this 'Bessie the Cow'. Mark told the story at a conference in London in February 2002 and I loved the story and made a Pearl about it which got a lot of laughs in events all around he world. Here is the slide from my presentation to CommunicAsia in June 2002 with the Connecting Cows in Canada:




So, now we have more on Conneting Cows in Canada. Its 2010 and the cutting edge Canadian Cows are of course now on Twitter! Mashable reports on an experiment at the University of Waterloo in Ontario where Twitter and some very clever milking high tech is used to record the milk production of the cows. And yes, the cows are on Twitter, they do their regular daily Tweets, with some bovine puns tossed in (something tells me its not cows actually composing the messages, that they have hired a ghost writer perhaps from the University haha). But yes, its the return of the Canadian Connected Cow!

My thanks to my dear friend Steve Epstein for sending me the link. Loved it, Steve!

Give me Twitter or Give me Death. Confessions of a Twitter Addict

This is a big moment for Twitter, as they have announced their long-awaited plans on how to monetize the service (using advertising). I find this most welcome, as many Twitter users had been worrying how long could the service stay in business without a legitimate business model and revenue stream. Here's to Twitter and hoping their ad model proves successful.

This is also a milestone moment for me. I started Tweeting in 2008 and have steadily grown myself a nice following, well on par with many fellow bloggers and experts in the mobile space (over 2,400 followers now) and I am listed in over 230 lists. Those are not the big milestone for me, however, it is the astonishing stat, that I am about to pass the 10,000th tweet today. Wow. Ten thousand updates to Twitter. Over two years thats 14 every day. But those who follow me know that some days I do nothing, but other days its like a never-ending overflow of tweets and retweets, easily passing 100 per day. I have had many followers write to me asking me to not post that much haha.

So lets celebrate Twitter here, and have a few confessions of a Twitterista. Yes I am now addicted to Twitter and cannot imagine my online persona without it.

I DID NOT GET TWITTER AT FIRST

I have to admit first, that when I saw Twitter and started to use it, I did not see its point at all. I was bewildered of why so many of my trusted peers seemed to love it. I did notfind value in what seemed like pointless updates of 'I am at the bus stop' or 'my train is late' or 'I am having lunch' or 'I am going to the toilet' or 'I am now reading this article' et



It wasn't until I had discussions with some friends I trusted who were active on Twitter, and I learned that Twitter could be a personal broadcast channel, that I started to understand. Then I saw what Stephen Fry was doing, that he would comment on his life on Twitter, but he hadn't stopped blogging or writing articles, and he would use Twitter to inform his followers when he had something new on his blog etc.

That was the opening for me. Now Twitter started to make sense. If I built myself a reasonable following, I could then drive some of them to my blog and announce upcoming books, conference speakerships etc. That made sense.

RETWEETS ARE FOUNDATION OF TWITTER

Then believing that whatever I do, I want to do well, so next came the stage of learning from the masters and observing them and developing my style. I learned (and observed) that some were very often retweeting what they saw was interesting or worthwhile. I picked up the habit of retweeting anything that was 'professionally' interesting ie it dealt with mobile or digital convergence or media etc; and occasionally also retweeting something I thought was particularly funny.

This dramatically increased the number of activities I had on Twitter. But as I was still learning it, I also saw that some on Twitter were very active retweeters, and that it seemed they also were getting far more engagement and discussion. The more you 'put in' into Twitter - and often a retweet of something valuable was far better than a personal tweet about yourself - the more you 'got out of' Twitter.

It became very clear to me, that often the person whose Tweet I had just retweeted, would get back to me, thanking or discussing the matter. And people would retweet further items I had retweeted. Then network economics kicked in. If my 'reach' of my network was larger than the original person, it would end up that I drove far more traffic to that person and discussion. Similarly every so often, one of my tweets (or retweets) would be picked up by some of the 'big names' with very large networks - and I'd instantly get many new followers, and often many direct comments and contacts.

Then I started to also receive comments in the style of 'Tomi you may like this' or 'Tomi what do you think of this'. Suddenly Twitter developed a whole new meaning to me. As my network grew, and started to have meaningful presence in markets, countries, industries and age demographics that I might usually not be involved in, I started to gain new automatic feeds of whats happening in 'my' industry.

This was about a year ago, when I observed that Twitter was becoming a major source of my market insights. That by the time I saw someone discussing it at for example Forum Oxford, more likely than not, the topic had already been discussed on Twitter. As a 'futurist' and forecaster, there is nothing more valuable than a radar into breaking news. And Twitter had achieved this ability and by last Autumn, Twitter had become my first and main source of breaking news in my industry.

By then I had developed my way of doing retweets, where I took the existing Tweet, and posted my comment first into the 140 characters, so I'd say something like 'Microsoft getting real with mobile' which I'd add to the beginning of the retweet, before adding the tweet I had seen from someone who discussed the new Pink (ie Kin) smartphones for example.

And as 140 characters is very very limited in the ability to discuss anything in any detail, I also picked up the habit of adding comments, after the Tweet, if that retweet warranted it. This way I learned to 'cheat' haha, to bypass Twitter's 140 character limit, and be able to discuss something in 280 characters or 420 or 560 or even 1,400 characters (ie ten follow-up comments)

CHANGED MY BLOGGING

Then I noticed another interesting pattern with many of my friends. Our blogging activity declined to an alarming degree. Many very frequent bloggers had quit blogging altogether and many others reduced their blogging frequency from daily to weekly or less.  I had my own aspects with it too. And I noticed also that the frequency of postings at Forum Oxford also declined.

So many of those things that I had wanted to 'record' in passing, a given tidbit of news or statistics or updates, that had prompted blog updates, had now already been covered on Twitter, so there seemed no point in also posting that on this blog.

What happened, rather, is that I noticed my blog entries had swollen to be enormous in length. It was clear, that when I did blog, I would tackle topics that were 'important' and to do those topics justice (this being a very complex industry) I would then write with far more detail and facts. And as the Twitter following was growing quite rapidly, with constantly new followers who hadn't heard of me, I also knew that many who would follow a link to a blog story, would arrive to read their first ever blog article by me. So differing from the long-standing 'loyal' readership here at the Communities Dominate blog, we were receiving very many readers who would post comments saying 'its my first time here' etc.

For them I felt I really had to go back in history, show the relevance of given topics, and to do a lot of the basics again and again. The blog stories got longer and longer. But I was writing to a new audience, many who didn't understand this space, and especially did not understand mobile, the most complex part of the converging media, IT, internet, banking etc industries.

I found that I was re-focusing far more on my roots, about mobile and telecoms, and not covering all that was happening in digital media, IT, internet online multiplayer virtual etc spaces. Mostly only if those touched upon mobile. Yet with Twitter I had far more 'issues' to deal with daily than I had ever seen before. Almost every retweet could cause a new blog story - and often many retweets did cause me to mention past blog articles I had written that did cover a given topic area.

THINKING OUT LOUD

Now I start my day with Twitter if I can. It is a great way to take a 'first bite' at any breaking news in the industry. It forces me to address the issues as they come - thus I am forced to follow the industry intensely and keep abreast of it. And it allows me to process the developments as they come. In a very literal sense, my Tweets are my thoughts outloud, I am 'thinking outloud' about my industry and letting my followers 'listen in' to what I think.

It has several great benefits, perhaps the greatest of which is the instant feedback. On the blog there were sometimes weeks that nobody posted a comment and I had no real way to know if there was even interest in what I wrote. On Twitter the feedback is immediate. People that I respect are there to comment instantly (or to retweet what I wrote). Sometimes they will retweet with a caution, that they don't totally agree with my point etc. Very valuable feedback.

Then there are the thousands who just follow and from whom there is a wonderful daily trickle of comments and questions that reveal exactly how well accepted or not a given point I made, may be. I learned quickly that certain points were not well known, and would need follow-up comments.

And then that wonderful feeling of 'my fans' who have followed me for long enough on Twitter (or knew me from before on the blog or from my books) who can anticipate what I would say, and we get those nice Tweets where a follower retweets something adding me to the tweet and asking, what do I think etc. And then there are those who are fans of mine who don't know I am on Twitter, and who quote me from my books or a conference presentation or some slides they have found. That is really sweet for the ego. And of course I reach out to them and start to follow them on Twitter - which often stuns them haha.

But yes, I am thinking outloud. Then that thought on Twitter gets refined. Sometimes when I see that bit of news, I know I have to blog about it. But that is rare. Its far more common, that I comment on something, and don't think much of it, but see the reaction it gets in the Twittersphere, and only after its reaction, I feel I should blog about it. That happens ever more frequently. That blog articles are caused by the reaction of my followers on Twitter not my initial observation about the news item.

Then we get the natural progression. A good story on Twitter becomes a blog entry. A good blog story is also posted on Forum Oxford. Good discussion of blogs and Forum Oxford comments mean I have to do slides, and add that topic into my next presentations. And what works on the stage and gets good audience interest, ends up in the next book. So what my Twitter followers get, is the very first rough draft idea-development for my next book. Only a small subset of my Tweets end up in the next book, but my books are reference volumes for years to come (I am already quoted in over 80 books by other authors haha). My Twitter followers and fans get the world's first peek into what might be in the next book. I believe that is a good value to them.

IN A CONNECTED AGE, SHARING INFO IS POWER

Those who have read my books or followed me for a longer while, know my personal motto - 'In a connected age, sharing information is power." That quotation of mine is in every one of my books, and I print it on the bottom of my business cards. Its a philosophy. Most young people subscribe to a philosophy similar to that, when it comes to digital information.

There are those of an age before social networking, who believed in a thousands-of-years old adage of information and power, that 'witholding information is power' - which is how bureaucrats in the Roman empire built their power. It was how all of the most horrendous dictatorships of history had held onto power. They found out nasty information about individuals, that was used against them; and they did not let their citizens have access to open information which would expose abuses of those in power. An open and unrestricted press was the antidote to such government abuses.

And I have found in my professional career, that giving out 'everything I possibly know' about any topic in my books, at public conferences, here on the blog and now on Twitter, etc, has brought an overabundance of riches to me, in terms of information that I would never have found by myself. So in line with my philosophy, every one of my slide sets ever given out, has 'bonus info' in the back, with bonus stats, bonus recommended websites, bonus books recommended etc. And again, my fans appreciate that.

Most of all, there are those who are stunned at how open I am on this blog and my emails and on Twitter, with 'facts'. Most of my 'peers' in consulting and the industry analyst space are unsure how to face 'social networks' with their valuable insights and knowledge. So they tend to hedge their bets, they give a little bit out for free, and save the rest for their 1,000 dollar reports or their consulting jobs. I don't. I blog here regularly with the freshest, most complete stats possible. And beyond that, I pepper my public presentations and articles and books with so many stats and facts as I possibly can fit into the story. And then after that, for those who really can't get enough, and want to know 'all the numbers' - I now have my TomiAhonen Almanac 2010 with 84 tables and charts, at the ridiculously low cost of 10 Euros.

In a connected age, sharing information is power. I have made a life of that philosophy and it in turn has given me a career. I give out numbers and facts and stats regularly, yet I receive more than 3 times, perhaps 4 times as much facts, stats and data in return. Some of it private info that I can't publish, others links to valuable data sources I never knew existed, even others are facts and stats collected by random peers who 'also have a hobby' of collecting info about the industry, and who just want to share with me. If mobile is the most complex industry ever, far more complex a science than rocket science; and if the ability to make money in mobile is the hardest part of mobile - and if knowledge of those issues is valuable, then indeed I am the wealthiest man on the planet.  And this philosophy has served me well, as I keep on spreading news, information, facts and stats about the digitally converging industries and find, that the more I share, the more I gain. Truly it is so, sharing information is power.

TWITTER AND ME

For me, the value of Twitter is most of all the instant commentary and retweets. Is a given story relevant or not, is it of interest or not. Should I study that matter more. Will my followers care.

As incidential benefits I also now have it as my early-warning radar of breaking news globally for my industry. I also have it as a personal promotion channel. And Twitter serves to spread my brand to new audiences, and has already generated new business contacts for me that resulted in new paid jobs.

I love Twitter. I could not imagine my professional career without it. But 10,000 tweets, boy, that is a lot of text. You know its over 200,000 words - thats two hardcover books worth. Just in tweets. Wow. Thats a lot..

For anyone reading this blog who doesn't follow me yet on Twitter, I am @tomiahonen and the fastest way to get me to follow you on Twitter is if you retweet something I tweeted or retweeted. If you are new to Twitter and would like to see who I consider most worth following, check out the three lists I have. And when you find something on Twitter that I retweeted that was of interest to you, please retweet it, or do also say hello on Twitter from time to time, will be most happy to talk with any followers and fans there (or here on this blog)

Microsoft Pink, Why is this Big News in smartphones?

Microsoft is about to release its first branded phones, and the first is targeted at women users who are heavily into social networking, instant messaging and SMS texting, and is called Pink. It debuts on Verizon's network in the USA. The story broke on Wall Street Journal and as the WSJ has a paid site for the full article, we get the main facts here reported by Information Week.

PROJECT PINK

So there are apparently 2 phones, under the Pink project, called Turtle and Pure. Both are smartphones running Microsoft's Windows Mobile operating system but not the full Windows Phone 7 system (which is scheduled to be released sometime towards the end of the year). They are clearly evolution of Microsoft's purchase of Danger which was the small handset maker that made the Sidekick that was popular with youth users because of its QWERTY keyboard. Both Turtle and Pure have slider QWERTY keypads, so these phones will go against the Blackberry youth segment (like the consumer users of Nokia E-Series) and not so much targeting the non-QWERTY touch screen devices like the iPhone, Google Nexus One etc.

Now, first note that this is a 'giant' change in Microsoft's strategy. Up to now, Microsoft has only been selling the operating systems for personal computers and smartphones. HTC was its biggest manufacturer of smartphones using the Windows Mobile operating system. With computers, we never saw a PC made by Microsoft, yet Microsoft grew to become the biggest computer industry company, far bigger than the hardware-making 'box movers' like IBM, HP, Dell, Toshiba etc all which used the Microsoft DOS or Windows operating systems.

But do bear in mind that if Microsoft now announces Pink phones on Verizon, that won't give them the world, not even the US market. They are on one carrier who has one quarter of the US market. It will be a long haul from here to set up the dealership networks to the other carriers. And a Verizon phone is a CDMA model, so Microsoft is not even able to sell the original Pink models to 80% of the planet that are on GSM networks. We need much more development still here, to get to any significant numbers on a global level, outside of the USA. But its a significant start.

IMPACT TO HTC

Now Microsoft has been observing the computer industry shift to smartphones. They seemed to pay lip service to the smartphone market, but last year the big announcements came from so many of their suppliers like Dell, Lenovo, Acer etc (all announcing moves to smartphones) and many existing players like Toshiba already making smartphones, and its biggest US rival, Apple already having dropped 'computer' from its name - shifting Apple to become a mobile company. Even Google Microsoft's biggest consumer PC software rival - shitted to smartphones. The trend is inevitable, and Microsoft was there already, but just as the smartphone market was shifting from niche to mass market, Microsoft was all but 'dropped' by its main hardware manufacturer. At the start of 2009 HTC announced that it had shipped 80% of all Windows Mobile smartphones ever made - yet HTC decided to focus on Android phones, not Windows Mobile. Just in Monday's blog I told you that HTC is witnessing its best quarter ever, with sales growting at 19% from one quarter to the next, and market share in smartphones growting from 5% to 6%. Very good news from HTC.

But this comes at a very bad time for Microsoft. For 8 years they saw their operating system struggle in the shadow of Symbian and decline from a peak of 30% market share to its current 6%. Meanwhile HTC is hitting that 6% for the latest quarter, powered by the hot new Android OS and its more appealing devices.

Windows Mobile is not dead by any means. There are for example new Samsung devices shipping with WinMo and HTC has said it will ship Windows Phone 7 devices when that OS becomes available towards the end of the year. But currently, Microsoft's market share is in tailspin. Apple's own iPhones outsell all smartphones made by a dozen manufacturers for Microsoft by 2.5 to 1.

So now we have Microsoft branded smartphones. Not just one, like Google's and Apple's first entries to the smartphone market, Microsoft is coming in with two models right off the bat. What this tells me, first of all, is that Microsoft is now becoming 'serious' in mobile. If they make phones on their own brand, they have to support those, they will be monitored in the market place, and their market success (or lack thereof) will be monitored by the industry analysts whose comments will reflect on expectations on the stock market. Its a big change.

Secondly, it is a slap in the face of Microsoft's handset manufacturer 'partners'. Just as much as Google's Nexus One was, but note this means we have no major smartphone OS platforms that do not have their parents as manufacturers. If you are say LG or SonyEricsson, its not a 'neutral' OS question anymore, if you go Symbian, that is part of Nokia's 'influenece' (Symbian is a foundation and open source). If they go Android they are supporting Google who also now makes phones. If they support Windows Mobile/Windows Phone - they support Microsoft also now a rival handset maker. That is easily seen as 'unfair' where a handset maker competes against you while supplying your operating system (we don't see any Apple OS/X or RIM Blackberry OS based phones by rival makers).

ANDROID AND APPLE NOT AFFECTED

I would think, that first of all, this means a boost for Google Android. If any 'independent' handset makers fell out of love with Symbian after Nokia bought out the Symbian owners (like Motorola, SonyEricsson, Panasonic etc) and then felt Google 'double-crossed' them by launching a Google branded phone, now that Microsoft has also their own phone, it makes Google look less 'evil' and further lessens appeal of Microsoft's OS. Android is new, hot, desirable, so if both Google and Microsoft are now equally 'evil' rivals making their own smartphones, why not go with the OS that is growing - Android - rather than the OS that is severely declining - Windows Mobile.

Secondly, I think this must have been coming for quite a while, after Microsoft bought Danger. And there must have been discussions with HTC about it. When HTC 'spat in the face' so to speak to its long-term OS provider Microsoft, by switching to Android, that gave Microsoft good reason to launch its Pink series of smartphones. Now that Pink is coming, it gives HTC even more reason to give Android devices preferred treatment in its portfolio - even when Windows Phone 7 arrives.

Meanwhile many IT analysts think Microsoft and Apple are natural rivals. Therefore, if Apple has a 'smartphone' called iPhone and Microsoft has a 'smartphone' on the Pink platform, they must be rivals. They aren't. Apple continues to go head-to-head against most (but not all) Google Android devices and (outside of the USA obviously) the big rival to the iPhone is Nokia N-Series. The Pink phones don't target this touch-screen consumer internet segment.

BLACKBERRY IS HIT HARD, AS IS E-SERIES

But Pink is bad news for RIM. Blackberry has been eating up that customer segment that once was loyal to the Sidekick by Danger. Blackberry has ridden that growth in all countries around the world, becoming the most desirable smartphone among the 16-24 year old segment in just about everywhere from India to Britain to Brazil. Blackerry's primary rival in the youth texting segment has become the Nokia E-Series and various Nokia QWERTY phones. But Nokia has often the 'stain' in its reputation among the youth, that its "our parents' phone" - so its often seen as not cool and sexy, not like the far more sexy phone brands like SonyEricsson or Apple or Blackberry. Nokia was not cool. Once the Sidekick was cool to a small segment in America. Now Microsoft has a good chance to gain that appeal once again. And certainly contest for that segment.

Bear in mind, Microsoft 'avoids' most of the 'rivals' that are 'supremely cool' in the QWERTY space, like Apple and most Android devices. Rather Microsoft sees the 'boring' rivals that were originally designed for business/enterprise utilitarian use, Blackberry and E-Series. It is far easier to become 'more cool' by design in this end of the spectrum, against Blackbery and E-Series, than it would be at the iPhone end of the spectrum with Google Nexus One etc.

BIG BOYS BIG BUCKS

A bit of market reality here - Microsoft as a company is twice the size of Apple, twice the size of Motorola and three times the size of Google by revenues. (But now smaller than Nokia, used to be the other way around with Nokia just a few years ago). So if Apple says its a 'mobile company' now, and goes full steam to mobile, and Google is going 'mobile first' - imagine what Microsoft could do, if it sets its mind to this market? Microsoft is by far the most profitable Fortune 500 company over longer periods of time like say a full decade, than any other IT industry company. They have very deep pockets.

Nokia is hitting back already, rolling out several QWERTY smartphones in the low end of the market, and now launching non-smartphones with QWERTY screens. These are not 'enterprise' phones like the E-Series, they are consumer (youth, texting) phones. Here is the big battle globally for the QWERTY consumer clients.

As to enterprise customers? Windows Mobile is the big 'third ranked' smartphone OS platform for enterprise/corporate clients globally, behind RIM Blackberry and Nokia E-Series. In North America Windows Mobile ranks number 2 in enterprise behind only RIM. What of these 2 new phones? No effect, they seem very much oriented as consumer devices, I don't see them in any way threatening RIM's dominance of the enterprise/corporate client space.

SHARP GAINS

What of Sharp? Who? Sharp, the Japanese electronics giant (a bit bigger than Google, a bit smaller than Apple) which happens to be the world's 9th largest mobile phone maker. Sharp does lots of different types of electronics, but like their Japanese rivals like Panasonic, Hitatchi, NEC, etc - Sharp has retreated from the world market for mobile phones, and only sold in the domestic market for the past few years. It does however, serve the worlds' most demanding mobile phone market (Japan) so advanced, that the original iPhone 2G was so out-of-date in 2007 for Japan, it was considered obsolete and not even launched there (Japan is the world's first country where 2G networks will be turned off totally this year, by 2007 they had stopped selling 2G phones totally). So Sharp comes with some very clever knowhow about phones. Including its patents and innovations about 3D screens that work on a phone, that do not require any special glasses to view the 3D image. Sharp is introducing the first consumer gadgets using 3D screens this Autumn in Japan. They may be smartphones or they may be gaming devices or digital cameras, but they are coming.

So, suddenly Japan's largest domestic mobile phone maker - who makes far more phones than say Palm or HTC - takes a giant leap into the US market. Sharp is running neck-to-neck with Apple iPhone for global shipments. This is a major player suddenly waking up to smartphones, and for Microsoft, if they lost HTC as a partner, they picked up one of the few existing rivals who is actually stronger than HTC as a partner. Very shrewd by Microsoft and for Sharp, it clearly signals a hunger to return to global phone markets.

MICROSOFT IS REAL

Uo to now Microsoft has been teasing us with occasional input into the mobile market, but never a wholehearted effort. Now we see a clear change. Can they reclaim 30% of the smartphone market, not with two phones, not this year, not when they start only on Verizon in the USA. But they can start to stem the tide, and perhaps stop the devastating loss of Windows Mobile's market share. (To quote Winston Churchill after the battle of El Alamein - this is not the end, this is not even the beginning of the end, but this is, perhaps, the end of the beginning). Yes, now Microsoft tells us they are serious about the mobile space.

Now they need more new phone models. Some can be their own, others will need to come from their handset partners. I still see Microsoft in the 5% market share in smartphones (and thus 1% in all phones) for the full year, but if you thought Microsoft was about to disappear, now that they announce their own branded phones, no matter what the cost of this bloodbath this year, Microsoft has suddenly validated its position and is definite to be here for at least a couple of years to come. But yes, brave move, when their base is enterprise/corporate phones, they go to the consumer space. In the consumer space, they don't go against Apple and the crowded touch screen internet/media phones space, they go to the youth texting QWERTY space. Hey, that sounds almost like they've read my two open letters to Microsoft and how Motorola could be saved. Cool. Welcome back Microsoft. We missed you!

How to do Clever Mobile Advertising in 2010? Don't copy web!

Its been a while since I last wrote about mobile advertising. The major bodies who report on mobile advertsing stats have all said recently that mobile advertising grew dramatially last year (2009) when the overall economy was in trouble and all other advertising spending was cut drastically. Some analysts suggested mobile advertising even doubled last year. My consultancy TomiAhonen Consulting said mobile advertising globally grew 85% (source TomiAhonen Almanac 2010). When all other advertising declines, and one part nearly doubles, that draws a lot of attention. And today all major ad agencies and digital agencies and major brands are aware of, and designing mobile campaigns - or mobile aspects to multiplatform campaigns. That is all good.

And we've had a lot of big news in this space, most of all Google's big announcement that they do "Mobile First" (and that last year they bought Admob) but also other PC industry veterans from Apple to Lenovo now say the future is mobile. And a lot of major players from yes Apple to Nokia have bought mobile advertising units and there is a lot of development in this space. Mobile advertising is hot.

So how do we do it? Today the vast majority of all advertising dollars spent on mobile go to two major kinds of ads, SMS ('spam') ads and banner ads to 'mobile internet' pages including WAP. And a rapidly growing 'buzz' in the mobile ad space is the adver-app for smartphones, in particular all those cool free Apple iPhone apps.

WE CAN COPY FROM THE WEB

Yes, we can copy ad concepts from the web (or any other legacy mass media like print, TV, radio etc). Yes, we can copy. That is dumb. That is lazy - if your ad agency comes back at you with 'banner ads' or 'SMS spam' ads - that is copying the internet models, ie internet web banner ads and internet email spam. Web banner ads themselves are web copies of print ads, and spam emails are the digital versions of our home junk mail.

A new hot area of mobile ad 'innovation'  [sigh]  is 'preroll video' ads - ie used with mobile (and web) video content. Preroll add means you are forced to watch an advertisement before you get to see that video. This is a copy of the TV ad model, where our TV viewing is interrupted to force us to view ads - the format we hate so much, that we buy TiVo and similar PVR/DVR hard disk drive recorders to bypass viewing any video ads. Now some 'clever' ad developers are bringing this punitive ad model to mobile.

(Oh, to readers: Long Tomi Ahonen blog warning - this is a complex subject and this blog is not superficial treatment, I include 11 case examples, tons of stats, and showcase unique aspects of mobile. It can't be short. It runs about 6,000 words so go get yourself a cup of coffee before you start, and you may well want to bookmark this page, I will be referring to this blog as my 'definitive treatise' of mobile advertising for probably the next year.)

MOBILE IS BETTER, WHY COPY?

We can copy from the legacy mass media yes. And if mobile was somehow 'inferior' as a mass medium, and 'deficient' it might make sense. But mobile is not just the newest mass medium (mobile is the 7th of the mass media in fact, where Print, Recordings, Cinema, Radio, TV and the Internet were the first 6 mass media). Mobile is new, thus 'difficult' and 'complex' and requires new type of learning - nobody teaches 7th mass media courses (yet) in the universities for ad executives to go and learn. But most importantly - mobile is actually 'better' or yes indeed 'superior' to ALL legacy mass media as a media channel. Why do I say that?

The internet (6th mass media channel) was considered the first 'inherent threat' mass medium, because it could replicate EVERYTHING that the previous 5 mass media could do. You can deliver books, newspapers, music, TV, radio, movies - every content type - as a 'web equivalent' experience. Not exactly the same, always, but close enough and often better.

That is not 'normal'. When a new mass medium is invented, it does not normally subsume all previous media formats. For example radio (4th mass medium) cannot show you a movie (cinema, 3rd mass medium). None of the first 5 mass media were 'inherent threat' mass media channels. The Intenet (6th mass medium) was the first inherent threat medium.

Now, mobile comes along and can deliver everything that all 6 previous media including the internet can deliver. Remember, it need not do it 'as well' - a movie is better in the cinema than streamed on our laptop. But yes, even books - even books - sell on mobile. All six mass media are already available on mobile - people do watch movies - you and I do not, but our kids do - on tiny screens of smartphones (and Sony PlayStation Portables, and iPod Touch's), no problem. So yes, mobile is the newest inherent threat mass medium.

But the reverse is not true. None of the previous six mass media can do everything mobile can do. Take for example the ringing tone. A global industry worth 6.5 Billion dollars (said Juniper in 2009). Thats over 4 times bigger than the total global music sales on Apple iTunes. Yes, ringing tones are that big - worth a quarter of the total global music industry, just ringing tones alone. And do you install ringing tones onto your laptop? How about onto your TV set? Do you install ringing tones to your seat at the cinema? How about the newspaper you read, did it give you a ringing tone option for the paper? Only mobile can deliver this new entertainment content type. Only mobile. I have hundreds of such examples in my books and on this blog. Things you can only do on mobile (as a commercially viable business, obviously). But one 6.5 Billion dollar industry sector of the ringing tone is plenty to prove that mobile can do something we can't do on any older mass media.

I have been cataloging the actual unique aspects of mobile - so mobile can do EVERYTHING we can do on older media, but beyond that, mobile has unique abilities you can't do on any older mass media. Because we can replicate all legacy 6 media, and then we have unique abilities that the legacy cannot do - that is why mobile can be called a 'superior' mass medium. It can copy everything the first six can do - while none of the first six (including the internet) can copy all that mobile can do. And then that mobile has unique aspects not possible on any of the legacy 6 media. Yes, mobile is superior as a mass media channel (but not superior for every individual content type, such as mobile is not the superior video/movie-watching medium, nor is it the superior gaming platform etc)

How many of them do we have? Eight such unique attributes already. Eight abilities that only mobile offers, which can't be done on a PC or netbook or iPad or Kindle or PSP or digital camera or DVD or digital TV. Eight unique abilities that only mobile the 7th mass medium can offer, that even the internet, the 6th mass medium cannot match. If we have 'unique' abilities, then WHY please WHY tell me WHY any 'creative' at any ad agency would bother copying the old tired models of older media. Especially if consumers hate those older models? Especially if consumers actually like the more advanced mobile ads? (ie those which are not copies of broken concepts.) Who in their right mind would copy a model that consumers hate? WHY?

TOMI WHAT ARE THOSE 8 UNIQUE ABILITIES

Yeah, its no secret. We've discussed them at length at this blog and in my books. Mobile has 8 unique aspects that cannot be replicated on any legacy mass media. They are:

1 - Mobile is personal
2 - Mobile is permanently carried
3 - Mobile is always on
4 - Mobile has built-in payment method
5 - Only mobile is always present at the creative impulse
6 - Mobile has the best audience measurement (better than next best by factor of 10)
7 - Only mobile captures social context of consumption
8 - Only mobile enables augmented reality (as a consumer-oriented mass media device, AR can also be done on custom tech like the military)

If any of these is not 'obvious' to you ("Tomi, are you sure 'permanently carried' is not the same as 'always on'") then please go read these in-depth blogs explaining each. The first 7 are best described here. And the lastest, 8th unique benefit is described here. If you are employed in the media-related industries, and that obviously includes advertising - you HAVE to memorize this list and understand these points fluently. If not, its like being a blind person, listening to a TV broadcast and thinking its essentially the same as the radio.

The point is - that if mobile has 'unique' abilities - then you'd be pretty dumb as a 'creative' executive in the ad industry, if you ignored those, and only copied older formats. Its like not understanding that cinema offered 'moving pictures' and you could design ads that had 'motion' - far more compelling for many types of ads, than the still images we had in the older media concept of print. You can't do motion in print. But if you just copy legacy ad concepts and do not understand these 8 newer unique aspects of mobile as a mass medium, you are telling the cinema owner to show a still slide as an ad. Or telling the TV ad guy to play the radio ad on TV.

My point - I hope you are hearing this - if you copy banner ads, spam SMS, or preroll ads - you are being LAZY and soon your rivals will do far better things with this new mass medium - and THEY will win the awards, not you.

EIGHT RECENT CAMPAIGNS

Lets take a quick look at 8 recent mobile ad or mobile marketing campaigns with one example each highlighting the 8 unique aspects of mobile.

Personal - BMW Winter Tyres Germany using MMS. My perhaps all-time most amazing mobile ad case study. Germany is not - apologies to all of our German readers - a 'leading' country in mobile telecoms. Nothing like Japan or South Korea or Italy or Finland. The typical BMW owner in Germany is not the nerdy mobile tech geeks like Apple iPhone and Google Android fanatics on the West Coast of America. Yet they 'loved' this mobile ad campaign so much that 30% of those who saw the ad - not just clicked on it, not just 'responded' to it, but actually appeared at an BMW authorized store to make a purchase. The campaign achieved a 30% conversion rate. They sold winter tyres to existing BMW owners. How? Not by apps or banner ads or spam SMS, but by the ultimate engagement-marketing platfform - MMS. BMW sent a truly personalized (yet automated) image of what looked 'exactly' like each owner's own BMW. It was the right model, the right color, with the right wheel rim - exactly as BMW would know, as they had just sold that car less than 12 months earlier. The total campaign, including creative effort and total airtime costs of the MMS messages cost under 120,000 dollars yet the new sales it produced in tyres and rims resulted in 45 million dollars of sales to BMW Germany. This cannot be done on TV or the internet or radio. Only on mobile can we show you 'your' car and bring it to your phone that you don't even share with your wife or children.. (our home PC cannot deliver that, we may have two BMW's in our family and try to sell the wrong car tyres to our wife etc). The service also allowed links to BMW's WAP pages with tons more car related services such as helping you sell your used BMW..

Permanently carried - Virgin Festival Buddy from Australia. Another very elegant, simple WAP service that was compatible with the 250 most popular phones in Australia, reaching over 98% of the music festival's audience. Part of the service was utility functions related to the rock festival - who is playing, where are the toilets, etc - but it also advetised and sold various concert-related materials including T-shirts, programs, music etc. We don't carrry our netbook or our iPod or our Kindle or our DVD player everywhere - but we do carry our phone - we take the phone to the bathroom we even sleep with the phone with us. Its the last thing we see before we fall asleep and its the first thing we see when we wake up (as we use its alarm). Only mobile. The service was deployed using WAP Push (which is a special SMS message with a WAP link embedded to it)

Always on - Just-in-time Dentist from Finland. A perfect little ultra-simple but so highly loved mobile markting solution on SMS, yes basic simple SMS. If you have a tooth-ache and your next apppointment is for Thursday, but suddenly someone cancels at your dentist, you now get an alert - who answers first to the SMS alert, gets the cancelled appointment (at half price too). Obviously this service is only opt-in, we would not sign up to dentist cancelled appointments unless we had an acute tooth-ache. Who wouldn't love this? Perfect, simple, elegant. Can't do that on WiFi or digital TV or Playstation or broadband - we are not at our laptops or TV sets or gaming consoles or notebooks continuously, but the phone is always on - the alert will catch us - even if we are asleep. No other media reaches us in our sleep. SMS does. 40% of the youth sleep poorly at night because their sleep is interrupted by incoming SMS (said Catholic University of Leuwen study on mobile phone addiction in Belgium)

Built in Payment Method - There are tons of mobile coupons. But here is a very clever way to do it. Puma the running shoe brand, launched a free multiplayer mobile phone advergame around the Formula One race in Shanghai. It allowed four friends to race each other for free on their phones and then to also race other F1 fans across the network. The prizes awarded for both those who were best at racing, and for those who were most prolific at forwarding the game virally. But the cool part - prizes were to be redeemed at Puma registered stores. This drove 'foot fall' to the Puma stores. The coupons were delivered via MMS and correctly attributed to those who won the races or who forwarded the most. Can't do that on TV or radio or cinema,

Available at Creative Impulse - The newer parts of the eight benefits have less innovation so far, and the user-generated part is a huge goldmine of opportunity that is barely even touched upon yet. But a good example comes from Japan in EZ My Styling the free virtual hair dressing service. It is a free utility that uses the cameraphone feature, the user takes a picture of their face, then uploades it to EZ My Styling. Then on the mobile web page the user can select hairy styles and see how they would work. These can be sent to friends for opinions using picture messaging  - which haircut should I take - and of course the service knows where you are, where are the nearest hairdressers that do that haircut, and allow instant booking of a time. Elegant. Can't do that on a OC or netbook or digital camera or PSP or Kindle.

Most accurate audience - This aspect has a lot of examples, but a world record response rate comes from South Korea, where Gillette ran a free sample coupon campaign for its Fusion razor. It was op-in of course (all good campaigns are fully opt-in, of course) and out of 240,000 registered men who were intersted in Gillette products, they sent out the coupons and 98% were redeemed. We can measure not only the audience, but the exact redemption rates by mobile, only by mobile. And this campaign, again not anything rocket science even in the world's most advanced broadband 3G WiFi WiMax internet country, in South Korea the country's largest mobile ad agency, Aircross, achieved this 98% response rate using... SMS.

Captured social context - This is truly bleeding edge ability for mobile and very few appliations of it exist in any space, far less so in mobile advertising and marketing. But we have one, the Obama 2008 presidential campaign and its iPhone App in the USA. The Obama iPhone app replaced the normal phonebook with the Obama campaign related phone book - and based on the US 'area codes' for phones - which tend to relate to the states - the Obama app would show the 'context' of the presidential election polls for each state. So if your friend Johnny was in Texas, it would show McCain leads by 62 - 38 but if your friend Jimmy was in Pennsylvania it would show Obama leading 57% to 43% etc. Note this was 'social context' not 'consumption'. We had not voted yet, the person with the iPhone app did not need to give his/her own view or opinion - and we didn't care if Johnny in Texas or Jimmy in Pennsylvania were Obama or McCain supporters - it measured social context only, not preference (ie 'purchase' or voting behavior by our friend). Brilliant app, we'll see much more of the social context in the years to come as the advertising industry gets to grips with this new aspect of mobile, just like it took a while for radio ad 'creatives' to learn to use jingles in their radio ads. 

Enables Augmented Reality - The last of the 8 unique abilities is Augmented Reality and the poster-child for AR is of course Layar out of the Netherlands with tons of advertising among their hundreds of layers. But lets look if there is AR done in other ways on mobile? We can also do AR for example with 2D barcodes, so lets take Ford's Ka campaign that ran in several European cities including London. The passers-by would see a giant 2D barcode on the ground. They'd point their cameraphone at the 2D barcode, and see the car. They could walk around the car, see it from all sides, but it was only a virtual car, the real space was empty. Very clever way to market the car. And yes, we can do AR on mobile, but can't do it even on a laptop, a notebook, not even a netbook, a Kindle or an iPad.

So there - eight unique, innovative mobile ad campaigns - very successful ones, in 8 countries on four continents, by several global giant brands like Puma, Ford, Obama, Giullette, BMW and Virgin, as well as a couple of smaller local brands and ideas. None of them were Banner ads, SMS spam or preroll video. These eight award-winning truly innovative and supremely successful mobile ad campaigns included three with MMS/picture messaging, three with SMS, three had some type of apps, two using the camera feature, three had the mobile web/WAP two featured mobile coupons, one was an advergame, two used augmented or virtual reality, two included viral elements, and one used the 2D Barcode feature. 

Were you amazed? Did you think reading through some of those ideas that some of them were 'innovative'? These are all 'old' ideas! I have been showing these at my various mobile ad workshops around the planet for ages. I had 7 of these 8 listed in my 2009 eBook TomiAhonen Pearls Vol 1: Mobile Advertising (which has 50 such case examples but with far more detail, stats, user satisfaction levels, expert quotes etc). And the 8th of the 8? ie the Obama campaign was in my Pearls Vol 2: Mobile Social Networking ebook also last year (also with 50 case examples of successful mobile social networking concepts). If those were 'award-winning' ideas a year (or more) ago, what can we expect from 2010? Far far better - BETTER - ideas than these...

DON'T DO BANNERS, DON'T DO SPAM SMS

So, I have shown you powerful successful mobile ad concepts, just a few, that used those 8 powerful new abilities that only mobile can deliver. Why would you even think of copying bad worn lazy ideas from the web or TV or print? Let the legacy mass media struggle with their outdated formats. Learn what makes mobile unique and deliver new compelling mobile ad campaigns. And if you are an executive making decisions about ad budgets - if your ad agency shows you banner ad campaign ideas, or spam SMS (or other interruptive mobile ads like location-based spam or proximity based spam like Bluetooth ads etc) or if they suggest doing preroll video ads, just fire your ad agency as incompetent and hire someone who is truly competent in mobile. Someone who knows it is possible to deliver compelling, successful MMS and WAP campaigns that are built on 'engagement marketing' principles - which start as you should know by now - with opt-in. No mobile ad campaign worth its salt goes out without prior permission from the recepient. All of my examples in the above were on the basis of opt-in. All of them.

But yes, there is more to mobile than interruption. In fact interruption should be forbidden. We can do value in mobile ads, from benefits (like Virgin guide telling us which rock band will be playing next) to coupons of 'equivalent' value to cash, to actual cash (or minutes, SMS text message balances) being delivered to our ad recepients. Then we can do interactive. Several of the above examples were interactive like EZ My Styling and Puma advergame. From interactive we get to viral. And the perfect mobile ad campaigns are built on 'engagement marketing' principles. What does that mean, it means that the user is enticed to join in the advertising or marketing experience and co-create it. Not 'user-generated advertising' - we are not asking users to go and make ads with their cameraphones (although that can be done, it would be an 'extreme' form of engagement marketing and its been done many times already). No, I mean co-create the experience.

ENGAGEMENT MARKETING EXCELLENCE

Three examples, three countries, three technologies.In Japan Northwest Airlines ran a free mobile advergame to 'guess the city'. Anyone could play, to enter you sent a free mobile message to the game. Any one phone could only guess once per puzzle. Big daily prizes of trips on NWA obviously. But here is the cool part -  everyone who guessed correctly received ...frequent flier miles on NWA ! This is awesome, who would NOT play this game daily? The idea is bullet-proof. It would work in any market on any airline. Winners get a small addition to their frequent flier mileage bank. If you never had signed up to Northwest Airlines - well, there is of course the mobile web site where you can sign up to start your FF account and start to collect your miles and winnings. So far this is just an 'interactive' advergame. Where does engagement come in? Users... users... we need users to co-create the experience. How do we get users involved? Easy. Users were invited to submit their own puzzles (the game was using a Japanese 'senryu' poem format). Now if you like the game, why not create your own puzzle, and perhaps next week one of the daily games will be your puzzle. This is engagement marketing - user co-created experience which works on so simple tech as SMS text messaging.

Second example, from the UK. Blyk and its MMS engagement campaigns with L'Oreal. Only those girls who are interested in make-up will get L'Oreal ads. But the company builds a dialogue with the girls and 'learns' based on what the girls like. Who is your fave supermodel - sends MMS showing 6 faces of supermodels who are on contract with L'Oreal. The girl picks the fave supermodel - after that all L'Oreal ads to that girl will be customized to feature only the fave supermodel. FAR more powerful than can be done on any other medium. And this is Britain, this is MMS, this is very today. And its totally engagement marketing. Tomorrow L'Oreal will ask which is your fave color, etc...

Third example from Slovenia in outdoor 'billboard' ads, making those suddenly not just interactive, but engagement. Lenovo was doing soccer/football related marketing with a company called Qootia. They had the game set up on an interactive video board. Passers-by were invited to join, pick a side in the soccer game, then take their phone and move the player and kick the ball. You might think this needs an 'app' for a smartphone. Or how else can they do it in 'real time' with SMS for example too slow to do live game movements? They did it on an IVR response machine. Take your phone, dial this number, then press 2 o go forward, press 4 to go left, press 6 to go right, press 8 to go back and press 5 to kick. Brilliant, elegant, simple - works on absolutely 100% of all phones. Get people to walk by, stop, play the game against some friends, while others view. This idea will be deployed at rock concerts, sporting events etc near you very soon, mark my words. Only with mobile. Can't do this with your awesome digital camera or Kindle or netbook. But every phone can do it and any child or grandparent can operate the game on a standard phone keypad. And obviously, we have our gamers inviting their friends to join their 'side' in the game - on-the-spot recruitmeny to join the multiplayer game while others watch. Lenovo gets their phone numbers.. Brilliant.

CONSUMERS LOVE ENGAGEMENT MARKETING ON MOBILE

So, one last argument. We all hate ads. Correction, we hate 'interruptive' ads. We 'tolerate' useful ads, but we actually enjoy entertaining ads. South Korea's biggest mobile advertising company is Aircross. Their CEO, BJ Yang says we should make mobile advertising fun, always, because as he says 'Mobile is a fun, personal playground.' Fun. Personal. Playground. This is very powerful. So, lets compare. On TV we hate ads so much - we actually purchase devices like a TiVo box to avoid the ads. On the internet, with classic banner ads, they consider it a 'successful' campaign, if they achieve click-through rates of half a percent. Half a percent. On mobile even the copycat banner ads get ten times that level, with click through rates on basic (interruptive) mobile ads like banners at about 5 percent.

That is not what we want! We hate interruptive ads. What we want is 'engagement marketing' like many of the examples here like Blyk and L'Oreal, like Puma F1 Racing, like EZ My STyling virtual haircuts and BMW winter tyres and Northwest Airlines quizzes. When consumers are given truly 'engagement marketing' based mobile ads, well designed (and usually delivered on MMS) - they deliver between 25% and 40% response rates. Yes, almost 100 times better performance than internet web interruptive models. I mean global stats, we find these from engagement marketing campaigns run in Japan to the UK to Slovenia to USA. Not 'novelty' factor. In the UK, over 2,000 such campaigns were run on Blyk - bombarding the youth with 6 ads per day, across 200 global giant brands like Coca Cola and Mastercard. Thousands of such MMS-based (and SMS based) engagement-marketing campaigns measured in half a dozen countries on three continents. Response rates 'astronomical' at 25% to 40%, consistently - over YEARS of such campaigns.

By this success criterion alone, who is such a fool to authorize 'hated' banner and spam SMS (and location spam and proximity bluetooth spam and interstitial interruption and preroll intereruption) ads if 'engagement marketing' can deliver from 10x to 100x better results?

But wait - they LOVE the mobile ads? Really? Tomi you gotta be kidding, 'love' - nobody loves ads. Even ad industry execs don't love advertisements. But Yes. I really mean it. Really. Love. Not my words. Jonathan MacDonald who used to be with Blyk said that their biggest complaint coming from their customers - this from teenagers who were under a deluge of a forced diet of 6 mobile ads they had to consume every day - the biggest complaint would by every ounce of logic and reason be 'please don't send more ads to my phone'. That is what conventional wisdom would suggest. And on TV and radio and the internet and print, we'd beg and plead to receive less of the the interruptive ads.

But using engagement marketing? THe opposite is true. The consumers, their biggest complaint on Blyk - was that they wanted more of the mobile ads. And think about it, if your ads deliver such value as coupons of goods you use, of prizes such as frequent flier miles, of a cool game you want to play like the Formula One racing game by Puma (cool for those who like racing car games obviously, my mother would hate it) and all sorts of benefits etc, if these are all opt-in, and personalized, and relevant. Then if they're made to be fun (advergames for example) - why would you not want more?

Back to reality. You the ad exec have the option to approve a banner ad campaign that is ignored, with lousy click-through rates and is often hated. Or more intrusive interruptive ads like spam SMS that is really hated. Or you could learn what is engagement marketing - get a third of the ads clicked through to response rate - and you get so satisfied consumers that they beg for more? What is wrong with this picture? Who is the sadist who approves interruptive ads on mobile, when we have engagement marketing that is loved?

DON'T DO APPS (...NOW, IN 2010, DO APPS LATER)

Finally an important point. The mobile world is abuzz with apps, in particular the ad industry of course raves about the coolest iPhone apps (and perhaps Google Android apps). Yes, we know every ad exec has an iPhone. But there are 4.6 Billion mobile phone subscribers on the planet. How many have an iPhone? If we count all iPhone 2Gs and iPhone 3Gs and iPhone 3GSs ever made - its about 35 million. The installed base is far less than that, as some iPhone 3GS and 3G models have been sold to owners of older models. But yes, even at 35 million it means that of the world's mobile phones, only 0.8% (zero point 8 percent, less than one percent) are iPhones. In its best market - the USA - AT&T reported last year that their total activated iPhone user base was 11 million devices. So in its best market, the iPhone has under 3% penetration.
 
What idiot ad campaign manager allows any development of an 'iPhone app' when it does not reach 97% of the mobile phone owners in its best market, and does not reach 99.3% of the mobile phone owners in the rest of the world? Huh? What moron ad executive authorizes that budget? Huh? SMS reaches 100% of the audience. WAP - yes what was the joke a decade ago 'WAP is crap' that WAP yes, WAP, reaches 95% of the phones on the planet. MMS reaches 80% of all phones. Who in their right mind approves an iPhone app before they have 3 mass-market mobile ad campaigns deployed - one using SMS, another using WAP and a third using MMS. AFTER those 'not sexy' mobile ad campaigns have been deployed, THEN you can think about apps.

Go back to my examples. SMS? The Northwest Airlines poems could be done via SMS (in Japan the mobile messaging is a bit different but the idea works on SMS easily in the rest of the world). The dentist alerts was done on SMS. The Virgin rock concert WAP link was delivered via SMS. The Gillette razor coupons were delivered via SMS. SMS text messaging has 3.6 Billion active users on the planet and every mobile ad campaign should start its plans around 'what clever thing can we do with SMS' - and SMS is a powerful engagement marketing platform. Only voice and SMS reach every mobile phone. Start your media planning with SMS. Then your brand is interactive and mobile in at least every pocket, before you even consider anything else. Yes, four of the 11 examples I listed were partially or totally delivered via SMS. We can do breathtakingly good mobile marketing and advertising on SMS. Its not 'sexy' and won't look cool on your iPhone - but Mr/Ms Ad executive - 97% of Americans, 99.3% of the rest of the world's phone owners do not have an iPhone. But they all can be reached with SMS. Start here.

Then WAP? The BMW winter tyres and the Virgin rock concert service both had WAP pages. The EZ My Styling and Northwest Airlines mobile web pages were partially delivered on WAP in Japan and partially on the real web on mobile. There is nothing wrong with doing 'real web' on mobile, but remember, that deliveres only half of your phones. WAP will get you 95%. And for most of the most successful web services - Google search, email, Facebook, Twitter etc - these are all 'current' valid internet services. All of those are easy to do - and indeed existing - on WAP. WAP is your second step, gets you 95% of all phones.

And the most powerful mobile ad platform - is not iPhone apps or real web, it is MMS. Don't think of MMS as 'picture messaging' but remember, it is Multimedia Messaging System. Multimedia. What is multimedia? Sound and video. MMS is a powerful, mobile-optimized way to deliver VIDEO, plus music and pictures, and text. And just like SMS, MMS is inherently interactive. It is BETTER than a stand-alone app on a smartphone, because MMS is inherently interactive. It is your optimized engagement marketing platform! MMS will be delivering winning mobile ad campaigns this year again, as it did last year and the year before. Multimedia Messaging System. Video, music, pictures and text, all mobile-optimized, all interactive, and for consumers when deliveing media content, is as familiar as SMS.

MMS is used by 1.7 Billion people already and has a reach of 80% of all phones. In the USA 40% of the total population already uses MMS (said Jagtag research 2009) and in UK 62% (said Aenas 2009). Of my examples here, BMW winter tyres used MMS, the Puma coupons were delivered via MMS and L'Oreal's engagement dialog with the girls was via MMS. The EZ My Styling picture messages of proposed haircuts sent to friends for evaluation - could have been delivered via MMS (again, Japan has its own picture messaging standards).

Don't do apps before you cover your mass market. Apple iPhone gets you 3% of USA, 0.7% of the rest of the world. SMS gets you the globe, WAP gets you 95% and MMS gets you to 80% of the pockets of owners of mobile phones. Start with SMS, WAP and MMS. My examples prove that you can do breathtakingly brilliant mobile ad campaigns - including engagement marketing - using these 'simple' but robust platforms. Its not 'easy' to get these done to every phone and on every network. Nothing worthwhile is. But please, don't do the interruptive stuff, and please, don't start with apps (now in 2010). Apps can come later.

Last year mobile advertising grew by 85% when the overall ad industry suffered. This year many analysts and experts and CEOs of major players in the advertising industry have already said mobile is growing strongly. You could do the easy bit, copy the older media. But don't. Don't do banners. Don't do spam SMS. Don't do preroll video. Don't do proximity bluetooth or location-based spam ads. And remember your reach, don't 'start' your mobile ideas on an iPhone app.

This year, 2010, the big global successes in mobile ads will be built on clever new adaptations of SMS, MMS and WAP, and with elements from the phones such as using the cameraphone, 2D barcodes, advergames, coupons etc. Then of course there will be tons of 'innovative' but ridiculously little-used adver-apps for smartphones. If you really intend to do any apps, do the SMS, WAP and MMS versions of your consumer mobile marketing and advertising first. Get the big market in your pocket. Use ideas like those in this blog. THEN go and do your clever app, but don't start a mobile ad campaign where you exclude 97% or 99.3% of the total audience.

AND THE PLUGS

We don't have ads on this blog. Did you notice that, no banners. So the only reason I come here from time to time to write these long essays is to share my thinking with the industry and then from time to time, to do a small plug at the end. If you are not familiar with what makes mobile unique (as a mass media channel or beyond) then you need to read the definitive volume on this topic, my sixth hardcover book Mobile as 7th of the Mass Media. The 322 page book is on Amazon and has 16 case studies of excellence in what is uniquely possible on mobile (and Blyk L'Oreal and Just-in-time Dentist are among them, 2 page case studies on both). If you felt you 'learned' something about mobile in this blog today, you really need to pick up my book on the 7th Mass Media.

Secondly if you are in advertising, then you should have in your pocket (installed on your smartphone yes I know its an iPhone) my eBook Pearls Vol 1: Mobile Advertising. It has 50 case studies just in your industry including 7 of the 8 in the top section, plus 2 of hte 3 I mentioned in engagement marketing (Northwest Airlines and Blyk L'Oreal). So 9 of the 11 examples in this blog are in the eBook among 41 other such global milestones of excellence in mobile advertising and marketing. The eBook only costs 9.99 Euros and is formated for the small screeen so the 171 pages pdf file fits on your smartphone and you can always carry Tomi's best 50 examples of mobile marketing excellence with you, to any meeting with any ad execs or clients etc.

Thirdly if you or your team needs more of a briefing than just reading this blog - if you feel you'd like to get truly up to speed with mobile media, mobile advertising and mobile marketing - I chaired the world's first mobile ad conference a decade ago, my first book was the first in the world to discuss mobile ads, and each of my 9 volumes has expanded the thinking in mobile marketing and advertising. I lecture on these topics at Oxford University and am available to support any interested ad agencies, digital agencies, brands, national ad industry associations etc. Lets discuss over email so write to me at tomi (at) tomiahonen (dot) com.

Don't Go for the Fool's Gold in Mobile. There is Real Gold for you

I have been monitoring several discussion streams on Twitter and the blogs and it hit me that many technologists are now pursuing opportunities that are fool's gold. These opportunities shine real bright, alluringly inviting investors to waste resources trying to get to them. But underneath the shine there is no gold. Now, in mobile there is tons of real gold out there, 250 Billion dollars worth of mobile data service revenues in 2009 which makes mobile bigger than radio or cinema or the gaming or music businesses globally. Mobile data is even bigger than the total internet industry. And its no secret where the real money is. But still, very bizarrely there is bewildering focus by so many 'experts' on the fool's gold.

LOCATION-ISTAS

What do I mean. Lets start with the 'locationistas'. This thought-to-be-extinct breed of technology-purists, feel that if you make it more accurate, the consumers will come. It does not matter at all to these 'alchemists' that all the evidence of more than a decade now, prove conclusively that the customers will not come. Yet they persist in peddling that tired old wives-tale, that 'there is a pot of gold in location-based services'.

Location-based services. Yet another variation of 'tell me where I am' or 'tell me where my friend is' or 'tell me where something else is'. This nearly vanished type of engineering passion suddenly re-emerged out of California when Apple put GPS onto its second edition of the iPhone in 2008. And while Nokia had quietly had GPS and maps on many N-series phones for a couple of years, suddenly the usually-very calm and smart Nokia too got the bug of location-based services.

So, today one of the hottest stories in any West Coast related tech investor and innovator groups is the collection of ever more mad ideas around location-based services, games, ads, apps etc. And tons of investment dollars and expensive developer resources are tossed at recreating fantastic precise location-based services to find out where is the nearest cash machine or toilet; where is the wife or kids; where am I; and various navigation aids, location-based games, coupons, ads etc. What a waste of effort. Futile. Totally futile.

It is true that the mobile data opportunity is experiencing dramatic growth now, and has in fact been the fastest-growing hundred-billion-dollar industry of the past decade. It grow very strongly even last year when most similar industries like television, advertising, print, personal computers and the internet industries all declined in value and tended to make enormous losses. Mobile data grew and made record profits.

So if mobile data grows, yes, even the 'dogs' ie the very poorly-performing parts will grow somewhat. Like location-based services. But think of this, excepting for a few vehicles and parcels and business assets -tracking types of business apps; essentially all location-based services have underperformed. Dramatically. For a whole decade already. Yes, its not that somehow with the iPhone 3G in June of 2008, the 'location-based opportunity' was created.

No, your clever location-based service, whatever the concept - has existed for many years before that, most have existed as commercially launhed services for more than a decade all around the planet. So all of those clever ideas of today, have actually been launched in Finland and Germany and Italy and Japan and South Korea - ten YEARS ago. Then some are tempted to say, but that was not with GPS. You are wrong. The world's most advanced mobile phone mapping and location and navigation service - EZ-Navi out of Japan - was upgraded to fully GPS-enabled ..in 2001.

EZ-Navi is so advanced today, it makes most concepts of location-based services I hear of, seem like the stone drawings of cavemen. EZ-Navi is super-science fiction, thats how far it is. EZ-Navi is so advanced, they've already created a full 3D visual mapping of all of Tokyo. This type of initiatives are 'long term plans' for most cities. EZ-Navi's precision-mapping navigation will show you any city block view from where you stand, and what you should see - where is that Tokyo copy of the Eiffel Tower? Oh, there it is, we should walk in this direction... EZ-Navi will let you pick what type of route you want to use - ie if you are walking, and want to take the route with the least number of stairs to climb (ie using escallators rather than stairs) - or equally the opposite, to get maxium 'exercise' ie walking max number of stairs. Or if you forgot your umbrella, EZ-Navi will show you the route where is most 'overhang' is through shopping malls, underground tunnels etc - as not necessarily shortest route, but the route that keeps you from getting wet, the best..

Maybe I am wrong. Yes, thats obviously possible. But if you are investing time, your team effort, resources, money, marketing and PR effort etc to any location-based service, please consider the facts. Since 2000, when major mobile service categories were first mapped out and published - location-based services have been the second-worst growing category of them all! (with only video-calling doing worse). Yes, MMS 'picture messaging' has outperformed location-based services. Yes WAP, famous for 'WAP is crap' has outperformed location-based services. Religious services outperform location based services. Cartoons and books for heaven's sake, outperform location-based services. 3G what some called the greatest economic failure in tech at one point in the past decade - has outperformed location-based services.

If for ten years, literally thousands of compaines have launched tens of thousands of services with supremely accurate technologies on fantastic handsets etc, perhaps its time to admit this is likely not the real eldorado for mobile. It is perhaps fool's gold. And like the fool's gold of the Wild West, it will draw ignorant pilgrims who will come and invest in what they do not understand and end up owning total junk. Your location-based services will mostly end up not worth owning.

Now, a great business concept may have a location-based dimension and be a big success. We can have a social networking service with location. They are not a success because of location, they are a success because of the social network. We can have augmented reality - like Layar - and it is definitely possible to do augmented reality with location-information (like Layar) - but its not the only way you can do augmented reality. You can also do augmented reality for example with special 2D barcodes as the famous Ford Ka campaign illustrated. So Augmented Reality is cool. Location is not. Location is one possible way to trigger augmented reality but its location is not what makes it awesome, it is the Augmented Reality part.

Same for coupons and discounts served via location. Why limit your coupon to the location? Coupons and discounts can be successful, they don't need location to be so. It is better to get permisson from the recepients and have them indicate what types of goods and products they prefer for which they'd like coupons and discounts. That is solid marketing work, and location is not relevant anymore. We get something better. And we don't need to limit it to GPS-enabled smartphones; and we don't need to pay mobile networks for the meaningless location-positioning data.

If you want to do great coupons for your customers, get their permission, then send them MMS coupons. No need to pay for location-information, and rather than limit your total possible audience to the 13% of all mobile phone owners on the planet who have a smartphone (and a small fraction of those who have GPS), you can send the MMS to the 80% of all phones that sit in the pockets of the economically viable part of the planet. Essentially anyone who can affford whatever it is you want to advertise, will have a phone that does MMS. And you don't need to limit it to the location. Take me. I live in Hong Kong. But my fiancee lives in Brazil. I would be very happy to take an offer of flowers sold in Brazil - and would buy them even when I am on another continent (try that for how wrong Location-based ads are), and certainly not buy them here in Hong Kong for myself..

APPLICATION-ISTAS

And then we get the other even bigger hype right now, peddled by the snake-oil salesmen and miracle cure  hoodlums I call the Applicationistas. A despicable breed of desperados who prey on the naive innocent pilgrims who are going west in search of fortune. Apps is fool's gold, pilgrim, stay away from apps. Especially any app store apps. That is a stacked game where you cannot win. You are like the paleface who walks into a saloon in the Wild West, fresh off your covered wagon, and you see a table of poker, and think that the game is honest. It isn't. And you are the victim.

So why all the hype. Remember where the apps fanatics came from, they came from the internet and PC apps industry. They once were told that if you build enough eye-balls, the money would miraculously appear. That size was everything, but revenues did not matter. Very respected experts and major business news fed thousands of stories that there was a 'new economics' that applied to the internet. If you built it big enough, you would be able to make money (in some imprecise way). Well. that hoax turned into a house of cards, fronted by swindlers such as Worldcom. And those who were lucky got out before the first hype cycle crashed - AOL 'bought' Time-Warner and never grew to its 'potential'. That whole era - less than a decade ago, was symptomized by 'I have millions of users of a free service, but some day we will make money out of them'. And they didn't. Google was a rare exception, not by making money out of millions of eyeballs, but by inventing a new format for relevant ads called Adwords. Yes, they were served on Google's search results, but Adwords would have been a success even if Google wasn't the biggest internet company. The same idea was adapted by Flirtomatic to its 'First Face' ads - and Flirtomatic has 2 million members. The idea is good, it didn't need the size of hundreds of millions of Google users to succeed.

Now fast forward a decade. Suddenly from 2008 we hear of Apple's App Stores having a billion downloads. Then two billion. Now its past 3 billion downloads. The big number magic potion again. "If its a billion downloads, gosh its gotta be good, I gotta gets me some of that". WAIT. Stop and wait. Where is the money? Most of these apps are free. MOST of them are free. Can you not hear the warning bells in your mind? Are we really that dumb? Its only a couple of years since we had the big dot-com bubble - an economic bubble - that burst. Free? Free apps? Come on, this is exactly the same sillly 'new economics' model from the previous dot-com crash. Hello pilgrims, didn't you learn anything from the previous generation? ("No, Mistah Ahonen, my pa, he went and bought some fool's gold and it was nice and shiny and he did go broke, but I am not afraid to go and buy me some of that fool's gold too, and get me some of that shiny stuff and it will make me rich.") How crazy are we?

What of the paid apps. The biggest category of paid apps for the iPhone are games. Duh? The Playstation Portable and the Nintendo Gameboy have had a lucrative market for games, very much of the same scale as what the iPhone gets in its games sold on the App Store. Is this now a new eldorado? No, it means that the gaming opportunity in our pocket is growing - just as the mobile and wireless and portable gaming experts (including this one) projected from before Apple said anything about an "App Store". The iPhone is a great gaming phone! So great, that Microsoft is bringing Xbox games to their mobile operating system, and SonyEricsson is now rumored to bring out a PSP-phone this year.

Every one of those 150,000 apps on the Apple App store had to be developed. I have seen estimates that it costs something like 15,000 to 50,000 dollars to develop an app for the Apple iPhone. Lets do quick math. If there are 150,000 apps in the App Store and it cost say 30,000 dollars on average to develop one, so far gullible managers have paid.. wait for it ..4.5 BILLION dollars to develop those apps. And Morgan Stanley told us that Apple iPhone Apps total revenues in 2009 were about what, 780 million dollars - of which Apple kindly took 30% as the kind store-owner to the fool at the so-called gold mine. (this is so exactly like the ignorant pilgrims who bought really expensive mining goods from the general store of the nearby town. The palefaces went to the mountains in futile attempt to find real gold, and the shopkeeper got rich)

So the total income after more than a full year of Apple App Store sales - to the total developer community (after Apple took its cut) is about 546 million dollars. So, at this level - if there was no further development costs for any of these apps - and no inflation - and no marketing costs of any kind - just from the revenue-share to the developers assuming perfect case of everybody earning equally, the current investment in the first 150,000 apps would be paid back by... the year 2018. Yes, eight more years - in the perfect case. In reality the mathematics of economics means that a few hit products will take the lion's share and in reality you will not get your money back, not even in many decades of 99 cent downloads. 

That is your best case, pilgrim. In fact, the App Store is a game of roulette where the house always wins, but it has not only one zero (normal Roulette, house wins) nor a double-zero (like Roulette wheels in Las Vegas which cleverly have doubled the amount of money the house collects). No, the apps game is so stacked against you, there are more multiple-zeros than total roulette winning chances. Why. Because only hit apps will be on the bestseller list. And only bestseller list apps have any chance of a mass market success and recouping their investment. And you won't get to the popular list unless you are first, or a known global brand, or very clever and innovative to the degree of patentable creativity effort - preferrably your app should have all three and even then its no guarantee of commercial success. So yes, the chance for you has passed, not last year, but it passed way back in September 2008, and since then its become a giant pyramid scheme, feeding Apple, helping hype up the app store, selling more iPhones and iPod Touch's, driving the hysteria of tech journalists and 'experts' but which won't earn you money.

Yes, and just like in Las Vegas, there will be a few, very random, very lucky winners. They will be paraded and celebrated in the fool's game of duping more developers to try their luck in this rotten casino game they call app store apps. On that luck you have absolutely no control. You cannot influence your luck in the app store apps game. And the rules of this game are stacked so badly against you, that you won't be one of the winners. You will lose your shirt in this, the ultimate mug's game. Your money will be taken, your app listed (probably) and you will not make back the money you invested. This, long before we add the marketing efforts and your various other integration and development costs.  

And its nothing against Apple. The same is equally true of Android, Nokia Ovi, Windows Mobile etc. Any app store. Currently, that is not a viable business model. It is pure hype. It is the re-birth of the free model that was so much the rage with the dot-com bubble.

By the way, an iPhone is in the pocket of 0.5% of the planet's population. In its best market, the USA, you get an 'impressive' 3.5% of the total population. Thats it. Not more. The facts are absolutely indispatable. any admob nonsense-stats will not change the picture, there were only 11 million active iPhone users last year according to AT&T and thats 3.5% of the US population. That is not a mass market in any marketing textbook. It is a tiny niche market. And if the world average for the iPhone is 0.5%, if the US is 7 times better, then obviously most of the rest of the world is even far worse than that one half of one percent penetration. Meaningless. Even if your app becomes a 'bestseller' on an iPhone.

Windows Mobile, Palm and Google Android are far smaller than that in their installed bases. RIM's Blackberry does a bit better; it can reach a whopping 1.2% of the total population of the world. And the most prevalent smartphone operating system of them all is Symbian which will get you into the pockets of an amazing 4.4% of the worldwide reach of humankind. Most of those Symbian devices would be Nokia branded smartphones. Don't kid yourself. None of the smartphones will reach anything approaching a mass market. Not for many years to come. So even should your smartphone app be popular, you are by definition limiting yourself to a target market equivalent to say, the reach of luxury sports cars like Porsche and Ferrari. Its not like you are offering a Ford or Honda to any car buyer.

REAL GOLD

The mobile data services industry was worth more than 250 Billion dollars last year. About 150 Billion was out of mobile messaging (mostly SMS and MMS messaging) and nearly 100 Billion dollars worth of 'premium data' ie non-messaging mobile data services and apps. Yes, I said apps, but the apps form a tiny percentage of this number, and those few billions are mostly business apps - sold to enterprises for their secure data access to their CRM and billing and email systems. Like say on the Blackberry. But not sold in apps stores. That is long-term corporate/enterprise app development, so yeah, if you're happy to develop with say SAP, and do a VPN secure access to an ERP solution, and then go to say the insurance giants and convince them to buy 10,000 licenses of your app - then yes, there is money in apps for you. It'll be costing you far more than the Apple iPhone app would, and the sales staff you need and sales cycles will be more like years than weeks, but yeah, sure there is some money in apps for business. A couple of billion (a couple of percent of the total opportunity). But thats like the industrial mining done in the Wild West long after the gold rush had passed. I am talking of a real eldorado here, not fool's gold and not the long hard drive for business oriented apps. I am of course talking about services.

We have a 110 Billion dollar global commerical opportunity in SMS text messaging related services. We have another 27 Billion dollar global commercial opportunity out of media services in MMS multimedia messaging - from TV videos and sounds, to newspaper pictures and stories - delivered via yes MMS. And we have a massive further opportunity on various web-style 'browser-based' services, from limited 'mobile web browser' WAP and i-Mode to 'real browser' xTML services.

These are not sexy. Its basic SMS, MMS and WAP (and voice..). Your ad agency won't like to develop them because these are not candidates to win awards. They want cool sexy apps they can show off on their iPhone. An SMS, that is so crude it would work on a ten-year old phone for godsake, where't the fun in that? The developers will hate them because these are so 'limited'. The designers will hate the lack of any modern features and sexy bits. But SMS, MMS and WAP work and are (near-)universal. And are so simple your grandparents can use them. But no, they are not sexy at all. Just that they work and they make money and they reach the mass markets in every country. Here is where 250 Billion dollars resides. iPhone apps delivered less than one billion. Do I get through to you?

SMS is used actively by 3.6 billion people and reaches the phones of 4.6 mobile phone subscribers on the planet. WAP can be used to reach 3.7 Billion phones and has an active user base of 1.3 Billion people. MMS reaches 3.1 Billion phones and has an active user base of 1.7 Billion people worldwide. These compare with 1.2 Billion total personal computers in use globally, or 1.6 Billion TV sets. (or 600 million total installed base of all brands of smartphones - which includes second hand smartphones like in Africa)

Yes, SMS, MMS and WAP are not sexy, but they make money today. You can deliver almost every major customer-service experience on mobile via SMS, from bank alerts, to mobile coupons to voting on TV shows like Big Brother and American Idol. MMS is supremely versatile, can deliver headline news services like all major Chinese newspapers do - as paid premium news alert services, sending headline news and news pictures like a small pocket-sized newspaper front page. MMS news - paid news headlines - are so big that the branded paper newspapers in China all have them, and 41% of the newspaper audience is now paying for these MMS news headline services. HERE is your real eldorado.

MMS is used for example by TV shows - soap operas sell 5 minute previews of tomorrow's episode today, right after today's episode has ended - for die-hard soap opera fans who can't wait until tomorrow. WAP is the most versatile platform of them all, and can do fully interactive web-like experiences. Most people who use Google search on their phone worldwide - in India 40% of mobile phone owners have used Google search (as the legacy PC based internet is so tiny by installed base of PCs obviously) - have done it using WAP. If you ask them 'have you used WAP' they would say no. But if you ask them 'have you used Google search' on their phone - they will say yes. And they don't have smartphones. WAP is designed for small screen mobile use. Design on it presents its own problems and issues, obviously. "Real internet' developers hate WAP for being so restrictive, but well designed WAP services can deliver great customer satisfaction, loyalty, heavy usage, revenues, profits - and win global mobile service innovator awards - like Flirtomatic did last year all over the globe.

SMS, MMS and WAP (and voice) - four very simple, basic platforms. But they reach most phones on the planet and services on them have to be easy and simple to use - meaning even your grandparents can use them. That is what we need on mobile. Not location-based services. Not app store apps. But good solid mobile services. If you develop on SMS, MMS and WAP, you can find real gold. Billions of dollars worth of it already today. The next Googles, eBays, Amazons; and the next Bill Gates's and Steve Ballmers and Steve Jobses will come out of companies that deploy global mobile solutions on SMS, MMS, WAP and voice, not those who develop LBS services or app store apps. Just like today, when Carlos Slim was announced to have become the world's richest person. His company, America Movil, does basic voice and SMS for 95% of their inome on mobile. Not apps, not location-based services.

Guys, am I a crazy guy? I have written nine books on mobile services and apps. Bestselling books including the fastest-selling telecoms book of all time. My books and theories are referenced in 70 books published by other authors. I lecture at Oxford University on the mobile services and apps opportunity. I've been invited to speak at 250 conferences in 50 countries, including time and again and again in the leading countries where the most innovative services and apps are made - in Japan, in South Korea, in the Scandinavian countries etc (And in North America all the time as well). If my peers trust me, maybe you should consider the value of this blog. I am not saying that there is 'no money' in mobile. I am trying to steer you away from the fool's gold, and into the real opportunities. While they are not as sexy, the real opportunity is in SMS, in MMS, in WAP and basic mobile browser-based services - and especially in the Emerging World countries where literacy is a big issue, there is still billions to be made in basic voice related services. Please give your team and project and company and brand the chance to succeed in the real gold rush. Don't go for the fool's gold. (and fire any 'experts' who are suggesting those paths for you)

Wanna read a positive roadmap to your future where the money is? Go real Digital Klondyke, the Cyber Eldorado.

For Your Eyes Only - the three levels of customer behavior based data

I had a lot of good discussion based on last week's blog story about our digital leash. I discussed how classic 20th century marketing research data concepts like 'demographic' data is becoming useless when compared with far more powerful 21st century behavior based data, collected from digital channels. And I argued that mobile is by far the most powerful of those digital means, in capturing behavior based data.

DEMOGRAPHICS VS BEHAVIOR

To be clear, demographics were a great data collection purpose in the last century when marketing was crude, the targeting very weak and we used mass media broadcasting 'propaganda' to try to reach our target demographic audiences. That was the best we could do in an analog age of print, cinema, radio & TV. WIth digital media (starting with the 6th mass medium of the internet) we go early steps into capturing actual behavior based data, and with this, suddenly the ability to do far more powerful targting. I explained this two weeks ago in my Amazon book recommendation 'advertising' blog. TV or radio or newspapers can never ever hope to get the accuracy and power of what Amazon does routinely in making recommendations to us. The ads are so powerful, almost nobody thinks of Amazon book recommendations as 'ads' and nobody would want to skip them or avoid them. In fact we hope to see that in all aspects of our commercial life - why can't we have recommendations for x or y like we have for Amazon in books..

Demographics makes assumptions on our demographic data - and massive errors that come from this generalization and stereotyping. But Amazon is based on actual consumption (of us, and then mapped against the patterns of millions of Amazon consumers across the planet). Before we could measure individual use, it made sense to try to 'group' customers based on some mechanics like demograpics (and in business, by industry classification codes, what is essentially demographics for B2B use) and then psychographics - barely more than the same. Demographics would look at a 42 year old married mother two kids and make the assumption that she's interested in 'mother' and 'home' types of things, not interested in 'youth' things like partying and going out at night. Now, while her demographic profile honestly can be 'married' and she may technically be so - what if she's going through a divorce (which won't take effect for many months) and is suddenly experiencing the dating scene, looking for a new boy friend. She's behaving like a teenager or young single adult. If we use demographics, we make massive mistakes. If we measure behavior, we get the reality.|

MOBILE BRINGS THREE LEVELS 

On digital media, like the internet (and this includes of course any 'real internet' 6th mass medium consumption on smartphones ie the 7th mass media platform of mobile telecoms) - we can get to the first level of consumer behavior data - what we consume. On the internet this consumption info is almost always only limited to individual merchants (ie Amazon can't tell me what I like on the BBC for example, the Guardian can't give me recommendations on Disney etc). But like we see on Amazon, the recommendation engine is a huge leap forward in customer insights. Amazon would not (should not) bother to collect demographic data on its customers, because behavior is so much more poweful and actionable and accurate data. Obviously any mobile data service consumption as at least as good as data, as any internet consumption would be. On mobile it can be 'apps' like fashionable now on smartphones, or it can be the 'real internet' or it can be the 'mobile internet' (which is not the same as the 'real internet' on a phone) or it can be other digital services and solutions and content from multimedia content delivered via MMS messages to basic news headlines via SMS to music such as ringing tones, various ads etc.

CONSUMPTION DATA IS BASIC LEVEL

The first level (basic level if you will) of consumer behavior data in digital is the 'Consumption'. For most in marketing, this is at first glance 'the ultimate' data, isn't it. Thats the 'holy grail' isn't it. If we know Tomi consumes Pepsi and not Coke, this is VERY powerful marketing data, isn't it. Are you Mr Ahonen now suggesting something 'beyond' this, something... even better?. 

Yes I am. Looking at consumption, is like primitive humans looking at the sky and thinking the world ends after the clouds and the stars and sun and moon are the limit of the universe, that revolve around us (as it seemed from that vantage point). Obviously we now know there are stars beyond what the eye an see, and many of what look like stars, are in fact galaxies consisting of billions of further stars, countless of which have their own planets and moons etc... Yes, that is the degree of sophistication we are talking about. To focus on consumption is the earliest 'cave man' level of this marketing insight haha..

COMMUNICATION DATA RELATED TO CONSUMPTION IS FAR MORE POWERFUL

The second level of Customer Behavior market researh data comes with Communication. Previously with any communication technology and media consumption technology, there was no way to connect the two. We had our letters and postcards, our telegrams and (fixed landline) telephones. None of these delivered media content (to any significant degree to mass market consumers). And we had our books, magazines, newspapers, cinema, radio, recordings and TV. None of those had a communciation channel.

That changed with the 6th mass medium of the internet, which started life not as a media channel, but as a communication channel (originally with email). The internet was communication first, and media later. And now that the internet has figured out a way to combine the two - we get 'social media' ie Twitter, Facebook, YouTube etc - and we suddenly get 'inherent' ways to combine communication with media consumption. What do I mean? I mean that when we combine consumption with communication, we get recommendations, we send links to interesting media pages - embedded into our emails. And we offer comment threads in media pages.

If you think 'social media' or 'digital communities' or 'user-generated content' or 'web 2.0" is 'big' so far - we have barely scratched the surface! Five years ago YouTube and Facebook were nowhere. Twitter is essentially a two year-old phenomenon. CNN's i-Report is 3 years old, etc. We have barely started on this journey of the 'convergence' of consumption and communication.

So to customer data. What do gain from the communication 'dimension' to our consumption? We gain all that we associate with 'viral' marketing. We can find out who is talking about our brand, good or bad. Who sends links to our site, who is generating buzz about us. It does not 'preclude' or 'invalidate' the consumption data, but the 'communication' is far more powerful for anyone in marketing research. One person bought our brand, did not talk about it. Ok. Another bought our brand and talked about it. Better. A third person never bought our brand but likes it and talks about it - wow. This kind of real customer insight can NEVER be captured in 'consumption' data - because this customer has not (yet) bought our product but clearly loves it (or hates it..)

Where can we do this, capture, this, utilize this? This is 'cutting edge' market research data, and for the most part we can find it in separate discussion channels like Twitter. Facebook, blogs etc. So while both exist on the internet - we buy a book on Amazon, we then mention it on Twitter. Mostly the two are 'co-existing' on the internet but not part of the same consumption or communciation. It can be - we can perhaps gather it to our own branded website, perhaps a 'fan club' etc. We have paid services on social networking sites like the massively multiplayer farming games that are the big rage on Facebook for exmaple. Any smart brand in digital, and those consultants and experts and agencies advising the brands - will want this 'dialog' with the consumers. It is central to 'engagement marketing' which moves the advertising/market communications beyond the mass market 'propaganda' preaching of the past century.

But also understand, that the 6th mass medium internet is incapable as a platform to deliver this type of insights across all services and all consumers. We can have the dialog and capture it, but only like Amazon and Facebook, we can do it within one brand or one channel like Twitter or YouTube at a time. Not across all users and all services. On mobile we have for the first time the opportunity to capture all consumption and communciation data, potentially (when currently collected by the operator/carrier, subject to permissions etc..).

THIRD DIMENSION IS CONTEXT

This is part of what hit me when we discussed my blog from last week. We are now witnessing the birth of yet a deeper level of insight. Understand the power of this. Amazon recommendation engine is inherently more powerful than TV or radio ads in selling books (or DVDs, CDs etc). Consumption data is more powerful than demographics or psychographics. Then we have communication of consumption - far more powerful, because now we see true influence (potentially, when well data-mined and with good data). Now we have something even more powerful. Again I am not suggesting to abandon consumption data or communication data (but I am saying throw away demographic data, obviously, as obsolete, not just useless, but counter-productive data!)

The third dimension is the 'Context' of consumption. That was at the heart of the examples I talked about last week. When we will gain the ability to collect accurately the 'social context' of our consumption - and various other 'context' elements such as time, location, proximity - we get FAR more powerful tools. Please don't mis-undestand me. I do not mean 'location-based advertsing - which is a very very bad and discredited idea. I mean like in my blog, what of the patterns of where I am, in relation to others. How I move. But also time, proximity, and yes, communication and consumption.

Here is a perfect example, valid today. Your mission is to find real - loyal - viewers of American Idol. Find actual contact info for as many of them as is humanly and technically possible today, with any means that exist.

You could set up a Facebook page. It won't get anywhere near all loyal viewers. You'd be lucky to get 10%. You could measure those who voted for American Idol - yes this is far better, perhaps a third of the audience. You could try various 'traditional' market research tools, interviews, the Nielsen ratings system etc. Nowhere near the chance to find the total audience. No way. And trying to all 'every household' in market research surveys would be astronomically expensive. You'd end up with only thousands of respondents and then like in decades gone past, you'd have to make statistical estimates on this 'sample' data. No, I mean real actual viewers of American Idol, just like Amazon has actual buyers of my books..

ONLY MOBILE GETS CONTEXTUAL DATA

But what if you took actual SMS text messaging traffic generated during the broadcasts of the show? 78% of the owners of mobile phones worldwide are active users of SMS text messaging. Even in America its past 2/3 of the cellphone ownership. And 91% of mobile phone owners keep the phone within arm's reach 24 hours a day, so we have our phone always with us, when we watch TV. Many - not all but many - who watch a given TV show will like to share that experience with close friends. This is a growing global trend. And when do we discuss our fave show - it used to be we called our friends after the show. Now its more and more likely we send SMS text messages to our friends during the show. Any kind of TV, whether its a soap opera or the big game of tonight or something on Letterman or the news. The sending of SMS during TV shows is even more so with reality TV shows that feature TV voting, like American Idol. If we measured from the phone networks, every consumer who has a texting 'pattern' to send (and receive) within a given 'circle of friends' (ie a digital community) messages during the TV show, we find a distinct group. When we extend this to see who then communicates with others, and do this nationally, we'll find millions who are part of this group.

I am not suggesting this will get us 'all' viewers of any TV show. I am suggesting it gets us the biggest actual personal identification of an audience. In the case of reality TV, roughly speaking we'd probably find half the total audience this way. FAR FAR FAR more than by any other means available.

Note that we did not need to 'read' the text messages for 'content' (like say Gmail does). We didn't need individual members of our audience capture, to 'consume' the content (ie vote on the show). We 'caught them' based on their context of consumption - who they shared with, when mapped against time and communication. We didn't need location information. Now we get easily over half of the actual total viewers in any country, who truly are loyal passionate fans of the Idols show. Whether you voted for the show or not...

Undrestand how powerful this is. On Amazon, you have to be online to be 'captured'. We get you from watching TV my way. On Amazon you have to consume 'their' content - buy a book or look at a book page. On mobile we capture - television viewers. Yes, we can capture also mobile content consumers (who used a phone for Twitter or Facebook or YouTube or downloads a ringing tone or goes to the Weather channel's mollie page). Amazon and the internet cannot get us audiences on other media - only mobile can do that! We can use mobile to capture an audience on TV (and if done cleverly, audiences on radio, the cinema, newsappers, magazines etc)

This is super-power 'bleeding edge' marketing research. This is the 'future' of marketing insights. This is where the big money and big commercial opportunities will be made this decade. Here is the real power where we need to deploy and develop in data mining. NOT to seek demographic data. That is pointless. Its as useless, obsolete info, as is the study into the efficiency of carrier pidgeons as communications tools today haha..

WINDOW IS NOT OPEN FOREVER

Now, the data today resides only in mobile phone networks (we can't get this data from fixed landline networks because the fixed landline phone is not personal - the whole family uses it - or more likely than not, the whole family today all refuse to answer the ringing of the home landline phone as they know the call is not for them personally haha). Same is true of the internet, because of firewalls, shared computers, deleted cookies etc, the sixth medium internet cannot deliver the personal data of consumption, communication and context - on a national level obviously - as we only can get from mobile phone 7th mass medium consumption.

So, today - 2010 - the handset maker (Nokia, Samsung, Apple, Blackberry) does not have this ability. The internet brands (Google, Yahoo, Amazon, Facebook) do not have this ability. The media houses (BBC, CNN, Sisney etc) do not have this ability. The banks and credit cards and loyalty card schemes do not have this. The only entity that can gather the full picture of Consumption. Communication and Context today - is the mobile operator, and in advanced markets like Scandinavia and the Baltics, Japan, Singapore etc, the operators/carriers already are deploying the technology to do this deep level of data mining. But they have almost no tools or skills or abilities to monetize this opportunity. Why? Well, a big part of that is because mobile is so far ahead of the curve that most top-trained 'Ph D' level brand name marketing professionals and gurus still talk about the supposed value of demographics and psychographics and have not been brought up to the speed of how much more we can get out of mobile.

WILL EVOLVE AND IMPROVE FAST

But marketing is a global competence and adapting and growing fast. The giants like Google and Apple and Nokia want to get into this space. The big mobile operators like Vodafone, China Mobile, Telefonica etc are slow to capitalize on it but are trying to. And the various ad agencies from the Ogilvys and Saatchis and McCanns are hungrily studying this space. Today that data collection is at the mobile operator exclusively, through essentially its billing system, but that will not last. There are too many 'outsiders' who are seeking alternate ways to this info. The smartphone revolution is a big step into that direction. Soon we will get at least part of the data off the phone, bypassing the operator billing data. 

So one, this is a blog to wake up the marketing, advertising, media, social networking and market research companies, to understand how much more data we'll be able to get to, when we abandon obsolete demographics, start with Consumption, and add Communication and Context.

But secondly, this is a warning blog to the operators/carriers. Don't fall asleep on this issue. You have to move NOW - because this ability is not going to remain exclusively yours. The market 'window of opportunity' will not remain open forever. It will close. You have to set up your ability to educate the marketing industries in your markets, provide accurate, actionable info into your customer base, and help grow this market - which will be measured in hundreds of billions by the end of the decade - or else you will be bypassed. 

I have more bubbling in my head about this topic - I will also develop a few concrete examples for our readers to make more concrete these examples. This may be a bit too 'theoretical' as a blog for now, but I want to get this thought out there, to add to the discussion from last week. Stay tuned, and please do leave comments if this triggers thoughts.