Vodafone, Telefonica Invest in Mobile Ad Startup

Further cementing the idea that mobile operators want to own the mobile advertising space, Vodafone and Telefonica have invested in Amobee, a startup that’s developing a mobile advertising platform. Amobee’s site describes its offering for operators like this:

Amobee’s single centralized ad server enables precise contextual and behavioral targeting across all users on all handsets for all non-voice related applications and services:

* WAP Browsing with both on portal banners and off portal Interstitials
* Games
* Clients (Video Players / Music Players)
* Applications (on device portals)
* Messaging (SMS & MMS)
* Video & Music Streaming

Our unified solution allows the operator to manage user journeys across all these services in real time and presents a consolidated campaign and inventory management solution. It provides a single point of commercial policy enforcement, post production, reporting and optimization.

Telefonica’s O2 unit in the UK as well as Vodafone Spain, Czech Republic and Portugal are already testing the Amobee platform; the investment underlines the potential for growth the operators see in this area, as well as their desire to control a platform and build it into their networks. This move isn’t particularly surprising, nor does it preclude the biggest potential problem in the mobile advertising space: the inevitable standoff between operators and third-parties collecting ad revenues from “their” customers.

The thing is, for ad revenues to really take off, operators need to come up with ways to share revenues back to content providers, rather than solely be concerned with the revenue share working the other way. This goes along with the smart-pipe strategy that seems to be making a comeback lately. Sure, operators should be thinking about ways to offer more ad-supported content on their own, but they can also add tremendous value by delivering an advertising platform that content providers can use to monetize their own mobile content. If the operators can add that value, they can expect to be compensated for it, and will find much less resistance than if they don’t do anything, but come knocking to ask for a cut because subscribers use their networks to visit off-deck sites.

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