Nov01
Lessons From Korea: Mobile Search Is More Than a Service; AdMob’s Novel View On The Value-Add of Mobile Advertising
Author: Peggy Anne Salz
Continuing with my coverage of the highlights from KOCCA’s Mobile Content Forum this week, I deep-dive into some of the controversial opinions and business models presented by a mix of Korean and Western execs.
THE FUTURE OF SEARCH: The “Google” of Korea, with a 70 percent market share thanks to its Naver search service, is NHN Corp. Jae-Hyeon, CHOI, the company’s director delivered superlatives and attributed its assured success in mobile to NHN’s sharp focus on “comprehensive” search. In a nutshell, the company has cleverly chosen to position search at the epicenter of a value web of services. “Search becomes a service platform,” Choi said. In this context search is more than a de facto interface, it’s a control panel that sits at the middle of all user-service interaction. That’s a model other companies would do well to think through. Why settle for being a navigation tool? The Korean example shows mobile search companies can add more value than that.
May the best algorithm win? Not in this case. Rather than rely on PageRank and similar methods to bubble up the best the Web can offer, Naver has partnered with some 900 content partners and integrated some 260 million databases to develop a “knowledge service” that delivers viable and relevant results. Translated: answers, not just links. In his view “search has become the main distribution method for content” in the online space and will play an even more pivotal role in the mobile space. Partner or perish? When it comes to search I predict that more partners will give you the edge, which is why I am a convert to federated search. The Naver example shows that search is morphing into a distribution platform and providers are well-advised to prepare for this shift. It will be most interesting to see if mobile search providers and operators can avoid a head-on collision.
SOCIAL NETWORKING: Food for thought and some free business ideas from the social networking panel (Antonio Vince Staybl, CEO and Co-Founder, itsmy.com; Sil-Keun, HWANG, Business Development, SK Telecom; David Nahmani, Director UGC & Communities, Orange; David Springall, Founder & CTO, Yospace).
What works? Vince had some very strong opinions on this – and his approach by-passes the mobile operator completely. (BTW – this just in from a company press release: “Ad-funded, US and EU mobile content community itsmy.com, with nearly a million reg. mobile phone users now connects more than 3.1 million mobile content items with its user personalized mobile mash up service.” In just five months 400,000 users have linked 3.1 million free mobile contents in the off-deck community, the company reports. The most popular mobile mash up contents are user generated videos followed by user pictures and mobile blogs/diaries. Links to other cool mobile content sites show the highest growth rates. 64% of all mash up content is already tagged.)
Based on this model, Vince said the sure-fire business model for social networking is one that lets users make and distribute content on their terms. Once users see the positive response to their content, they automatically make more content, which attracts more users, which inspires them to make more content – and so on… Traffic has been doubling every two months. Users show content as part of their mobile persona and users connect around content. As Vice put it: “It’s not about finding people like you; it’s about connecting with people who like what you like.”
Where’s the money? Orange has some original views. The idea is to create and distribute social networking services [an example is a new photo-sharing service it has introduced in French, Spanish and Chinese (?!)] that are open to both Orange subscribers and customers of other networks. In this scenario, Orange generates revenues by providing better support and functionality to Orange users. (Remains to be seen if this value prop is enough of a reason to become or stay an Orange user…) Another idea high on the Orange radar: offer a bundle of mobile social communities in a personalized package. As David put it: “The user wants to mix and mingle in a variety of communities and operators should enable this. Customers don’t go to the same restaurant every day, so why should they want to be a part of the same community every day?” Translated: choice matters.
Meanwhile, Vince had other ideas. Make the social network free – period. Uploading and browsing are free of charge; charge for intra-personal communications such as guestbook entries. He counts 15,000 guestbook entries, so users are willing to pay. Vince is also mulling over an MVNO, so likewise he’s convinced users are willing to stick around for the long haul. (I have my doubts – unless he opens it up for itsmy.com members to bump and connect with all the other social networks out there. Tastes change and so why would users want to be tied to any one community?)
MOBILE SEARCH AND ADVERTISING: Judging from the positive feedback (and numerous requests for my presentation) attendees are converts to the pivotal role of search and advertising in the mobile content continuum. It blew them away to think of the money they are leaving on the table when they fail to deliver content users like or results they find genuinely useful. Remember: it’s not about browsing, it’s about finding.
My panel on this topic featured Ivanka Hahnenberger , European Business Development Director, Admob; Mike Kent, General Manager EMEA, Jumptap; Dave Moreau, CEO, Fonestarz and Eun-Kyung, NA. Senior Researcher, DAUM. (My thanks again to all the speakers for an invigorating exchange that continued long into the networking session.)
Dave contributed some interesting if not controversial views that opened my eyes to the tension between search and discovery. He isn’t a great fan of mobile search because he feels it could steer users away from the very content he wants them to find. (FoneStarz distributes and manages content in 25 countries and has sold more than 8 million items of mobile content in the first six months of this year. The company is currently expanding its core specialties by moving into the mobile search and advanced video markets.) He would also welcome more engaging mobile search results that include, for example, thumbnails of content and some idea of the real popularity (what people, not algorithms, rate and rank).
Delivering relevant search results and enabling targeted advertising are at the top of the agenda for JumpTap. It’s a tall order since the average length of a search query JumpTap sees is six letters. But it’s choosing to focus on beefing up the tools and technology that will collect and collate customer data such as users’ demographics in cooperation with the mobile operator.
Ivanka shared her list of top mobile search terms, and Google wasn’t one (!) Users were more eager to find “games”, “myspace”, “ringtones”, “video”, “free games” and “wallpapers.” (AdMob doesn’t offer adult content, which explains the absence of “sex” or “porn” – the terms that typically lead the pack when it comes to search.) She walked us through TapTap, a cool concept that can best be summed up as a Digg-like destination that lets users submit mobile sites and Tap (Digg) the sites they like. (More importantly, TapTap can also be used as a portal, searching and browsing sites by category like Sports, Ringtones, News or Local. But more on that later, Ivanka has kindly offered to arrange and interview for me with the brains behind TapTap, so watch this space.)
This product dovetails well with how Ivanka (and likely the rest of AdMob) sees the interplay between mobile search and advertising. In her view poor usability and relevance mean search isn’t working. “Advertising has become the back door into search, allowing users to drill down and discover content and results through ads that appear on their screen.” She has a point: anything that guides users to content they like is a good thing – provided companies make sure the match between results and ads makes sense. Translated: relevancy rules!
Mike agreed 100 percent and spoke candidly about his own frustration with being inundated with ads for Land Rover cars on his mobile phone. Inventory is a problem and will remain one until more publishers get in on the action and launch mobile, searchable sites. JumpTap effortlessly sold out inventory on behalf of Telefonica in Spain and reports similar successes with other operators (no details at this point though). Another problem the industry has to tackle is capping. With no way to distinguish between new users and old users (the ads match search queries, not individual users), all players in the ecosystem run the risk of delivering the same ads to the same people over and over again.
What’s the Korean experience? Na told me DAUM is mulling over mobile ads, but is not convinced that search and advertising are two sides of the same mobile coin. DAUM wants to avoid spamming its users at all costs. Mobile search usage is generally around 15 percent in Korea and “10,000 terms account for 40 percent of the searches.”
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