Persistence pays off. I have had Amdocs high on my radar ever since it went on an acquisition spree in 2006 and snapped up Qpass, a digital content and commerce solutions company I covered from the start because it understood the power of (and more importantly had the capabilities to enable) personalization, recommendation, and targeting based on customer profiles and user behavior. (In fact, I was so impressed at the time that I signed on to write the Qpass online newsletter, a publication well before its time that even today still has its fans.)

I was convinced back then that the combination of Qpass and Amdocs, whose corporate DNA is inextricably linked with deep-dive data collection, data mining, and analysis, would result in a platform that would ultimately allow operators and service providers to unlock the value of their customer data to deliver the right content (and in this scenario, advertising would be another form of content) to the right user.

That was just a hunch at that point. Since then, Amdocs has quietly acquired mobile search IP through an acquisition (so quietly that I completely missed it – and to this day, Amdocs won’t disclose the name of the company).

Another little known fact: Amdocs oldest and most successful product offering is not billing or CRM; it’s supporting directory publishers. For 25 years this has been a prime focus and helped Amdocs to get 70 percent of tier-one Yellow Pages publishers worldwide on board for Amdocs systems and solutions to develop and distribute their directories via print, online – and now mobile. Connect the dots (analytics, personalization, targeting, location content and services) and Amdocs does indeed cover enough bases to have a significant impact on the mobile search & advertising marketplace, where the end-game is about content and context, and insight into both.

Fortunately for me, Amdocs rewarded my early interest in the company with an exclusive briefing with Eitan Gelbaum, Vice President, Product Marketing, Amdocs Advertising, Commerce & Entertainment Division, and a valuable view into the future roadmap. Thanks again to Garland Harwood, Account Supervisor at Weber Shandwick, for making this happen and for granting MSG exclusive access to an upcoming best practice report, which I’ll share in a post soon.

Before I focus on Amdocs’ future plans, it’s important to understand the depth and breadth of the company’s offer. In my view, Amdocs, armed with these capabilities, does not yet compete with Internet giants (such as Google) or mobile marketing companies (such as Amobee), but the potential is clearly there. It’s also important to note that Amdocs seeks to be an advocate of mobile operators and service providers. The singular focus is on enabling these companies to take on Internet companies, media brands, and handset manufacturers nibbling away at their business, diluting their brand or simply trying to turn them into dumb pipes.

What does Amdocs offer?

The heart of this new Amdocs is the Search and Digital Advertising Platform (SDA) that is designed from the ground up (harnessing the acquisitions I listed above) to let operators service relevant and personal ads to users in all media (SMS, MMS, WAP, and video), as well as manage the entire advertising lifecycle (campaign and management to reporting and billing).

Take a look under the hood, and the heart of this ambitious system is an impressive ad matching engine with personalization capabilities. The combination of search algorithms and analytics can drill deep into the subscriber profile, behavior, and preferences – the works – to serve relevant and personal advertising.

Put another way, the operator/provider can be their own publisher of ad inventory (using customer data, location, network data) or they can also work with external publishers. Either way, they have the capabilities to deliver relevant advertising. Indeed, ad agencies, marketers, and even small business owners can tap into SDA (implemented via the operator/provider) to develop campaigns segmented by demographics, behavior, context, time of day, ZIP code, and location. At the other end of the spectrum, Amdocs also delivers everyone involved real-time campaign management through what the company terms “an intuitive executive dashboard.”

It’s at this point that I must put on what I will now call my Jonathan MacDonald hat, show some healthy skepticism, and question whether the end-game is targeted mobile advertising or whether at least a part of the personalized ad pitch should not focus on enabling relevant engagement. Granted, it’s beyond the scope of this article – but it is a question that nonetheless occupies my mind.

For now, let’s simply accept that there are no answers but there IS a growing body of evidence that users will accept advertising if it is targeted, useful, and offered in return for the right incentives. Against this backdrop, the pivotal importance of an offer such as Amdocs SDA becomes crystal clear. Operators/providers have always had the information (context, location, user profiles) at their disposal; now, with Amdocs SDA, they have a platform to process it.

How does search fit in?

Amdocs SDA uses fuzzy logic to process both structured and unstructured data sets in real time. Each search is personalized based on the customer’s search criteria. The search engine understands context, so it can narrow down the set of relevant data and perform a more complex mapping of the data set.

By combining context with customer intelligence, Amdocs’ search engine can produce strong correlations between the user query and the ads served. And once the ad is served and the user action recorded, the data is filed into a central repository and combined with other data subsets for machine learning. This way there’s a good chance that the next ad served to that subscriber will be even more precise.

Those are the pieces, but what is the whole?

I asked Eitan to walk me through the big-picture strategy and what Amdocs aims to accomplish. It’s all about “leveraging the service provider assets to help them become the dominant player in the value chain.”

LOCATION: Amdocs doesn’t just have relationships with directory publishers; it has an understanding of the location services business. “It [location services] is a complex business. Directory publishers manage a large amount of local data and if they can marry this with location-based services, then that’s a compelling combination.”

RELATIONSHIP BROKER: At first glance it may appear that Amdocs’ strength is the software and systems, but Amdocs’ ace may be its ability to build and broker an ecosystem that puts its operator/provider customers in the driver’s seat. In the case of location services, Amdocs could “actually bring content partners and advertising partners to the table.” In other words, Amdocs could “broker relationships between the service providers and the Yellow Pages publishers so that they can bring the Long Tail of tens of millions of local merchants to the mobile space.”

In addition, Amdocs can manage the local advertising content across the publishers. “It’s easy for us to create data interfaces and enable that advertising, or that advertising content, to be extracted from the Yellow Pages publisher systems, and then [be] delivered onto the mobile device.” Is Amdocs bringing publishers to mobile as we speak? Eitan says negotiations are in progress and “about to materialize.”

MOBILE ADVERTISING: Amdocs has “a set of applications for the agencies and a simplified interface for the Long Tail for advertisers, enabling them to set up their mobile campaigns, their targeting parameters, and pricing that they’re willing to pay.” The role of the service provider in this scenario? “The service provider approves the campaign, approves delivering the advertising to the publisher real estate, and monitors progress and cutting coupons on both sides.”

Will Amdocs serve ads? Eitan says the company has an ad serving component but the importance of one is waning. “Ad serving is becoming commoditized. You have to have an ad serving component if you’re in the business. But I think that the strength of the solution we have is the fact that the targeting mechanism underlying the solution relies on the very deep and rich customer information across billing, CRM, and how they interact with content.”

COMPETITIVE LANDSCAPE: Amdocs doesn’t compete with an AdMob – yet. Although buying media on behalf of its customers is an area Amdocs may look closer at. “It’s not a competency of ours…but it is something we are planning on doing.” A more likely competitor is a company like Amobee. However, there is no single company that covers all the bases that Amdocs does. (If you know of one, then please send it my way.)

Likewise, Amdocs doesn’t compete directly against Google, Yahoo, Microsoft – but it could. The model is about “enabling service providers to compete on an even footing with them – and win.” As he sees it: “The value chain is in flux. The business models are being determined and there’s no one clear business model that you’ll see across all geographies or across all carriers. Some carriers are content outsourcing some of the media to Google and just getting a check, and we’re fully supportive of that strategy if our customer chooses it. Other carriers may be more ambitious and create their own network to fully monetize their own assets. We’re in a position to help them do that as well.”

HYPE: A year ago, mobile advertising was hype. “This year, we’re seeing a transition and companies are taking both a practical view and practical steps….Operators understand that mobile is, if you will, the last screen and I think they’re going to put up much more of a fight [than they did in broadband] and work together to get this right and define this single set of metrics to track performance across their ad networks.”

LOCATION-AWARE: Amdocs is sharply focused on helping operator’s deliver location- specific/ context-aware advertising. How would this work? “We can determine psycho-graphics profiles from what is already in the CRM systems, add location, and then serve local ads in local context. This could either be [a service for] brands that have a local franchise or local merchants.” Another scenario involves search advertising and coupons. “One of the things we’re testing right now is enabling the use of OpenMarket [Qpass brand known for D2C mobile commerce solutions that Amdocs acquired], a solution integrated with all the carrier networks in terms of SMS and messaging, to allow users to go into a Yellow Pages [print] directory that advertises a short code with a keyword, type that into their mobile phone, text it, and receive a mobile coupon on their device.”

MOBILE SEARCH: Amdocs’ mobile search offer doesn’t compete with Google & Co.; it does one better. “We are leveraging this [mobile search] functionality to perform any combination of on-deck/off-deck search for content, as well as running the engine in a federated manner over other search engines.” In Eitan’s view, the killer app is not search; it’s about “leveraging subscriber information to make the search results tailored and the search advertising targeted. It’s that kind of intelligence we want to bring to mobile search.”

Why? “CPM rates increase by orders of magnitude the more personalized and targeted results [are], and we can achieve this [performance]. We can also leverage different data points, as well as different forms of advertising and different modality of delivery, to provide advertisers with national/regional distribution at the same time we provide consumers with a choice of how they want to interact with the advertising.”

My take: While there are no service provider implementations at this point by which to judge the effectiveness of the Amdocs SDA platform, they are in the pipeline. Sensing a business opportunity (or shall I say threat from Internet giants and handset makers?), providers are painfully aware that they must deliver content, advertising, and search results (all forms of content) aligned with all the clues users leave behind (profile, location, context, search query – and the list goes on). Amdocs has bundled this into one offer – and it just may be the mix that makes it.

This entry was posted on Friday, July 18th, 2008 at 1:17 pm and is filed under Content Discovery, Local Search, Location-based services, Mobile Advertising, Mobile Search, Personalization. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.