Media Week

A release date has been issued for the first mobile phone to use Android, the mobile operating system being driven by Google through a collective of partners it pulled together last year. It’s to be called the G1 and will be available on T-Mobile. So, the first ‘G-phone’ should be here by Christmas.

These days it’s impossible to examine anything ‘digikal’ without Google coming up. Even if you’re talking about the internet’s infrastructure - the physical pipes under our roads and oceans that carry all the data - you’ll come across the big G since it’s a major investor in the new super-fat pipes being laid to cope with its growth.

But it’s obvious why the company would put some of its [endless supply of] cash behind such a project: the bigger the internet’s capacity, the more people can use the web more often, the more search traffic it generates, the more money it makes.

Less obvious is an apparent move into mobile phone manufacture. The answer tells us just how clever Google really is. It identified the mobile market as the most serious opportunity for growth for the web (and particularly search) years ago. But, after seeking to chivvy along the sector, it saw that advanced mobile services were being let down in the most fundamental area of all: usable devices.

It also saw that the key to this was the lack of a standard operating system, one that could allow handset manufacturers and software developers to build their own products and services from the same starting point, just as Windows has done for PCs for the past twenty years. So, it decided to take action. It asked a load of disparate partners to join hands to build a standard operating system around which the mobile market could then develop.

Its problem is that, in the meantime, Apple came along and – as is its wont – did entirely its own thing. The iPhone was possible because Apple owns and houses device manufacture, operating system and software development in one place. The G1 will struggle to compete in terms of design and usability because it is, literally, built by committee.

But, it also has its advantages. Android – as a project - has the support of many incumbent players in the mobile space and it’s hard to overstate just how tricky life can be in the mobile sector without it. And it has Google, the de facto operating system of the web. If it can translate its model successfully for mobile, then the G1 and all the other G-phones that follow will become the most useful devices by virtue of their synergy with that model.

Google’s strategic mission is clear: to build the dominant traction of the new, mobile desktop over which, in the ‘immobile’ world, it still has to fight Microsoft. But, the joyful thing is that, if at the end of it all G-Phones turn out to be dogs, none of that strategic insight will mean a jot. Rarely has so much rested on favourable electronics reviews but then maybe that’s why Google thought it best to share the responsibility.

Android and T-Mobile G1's Five Most Obnoxious Flaws

Video of the T-Mobile G1 Google Android Phone

Google enters the mobile market with iPhone rival

News arrives that CNET, the Telegraph and Trinity Mirror have signed up to Nokia’s Media Network – so advertisers can add them to the list of sites on which their mobile banners can appear. But, should they bother?

Nokia claims that click-through rates average 10% on the network but, having seen mobile banners in situ and tried to navigate around mobile sites on a regular basis, I can’t help thinking that won’t last for long.

Most mobile banners are for mobile content – games, screensavers, ringtones, nudie pictures etc. That’s because that’s all you can really buy through your phone. They are thus a natural click for mobile users. They also tend to dominate, yet blend into, the existing content on mobile web sites in a way online banners really don’t, which helps the click-through rates. And as more services come to mobile, especially with pay-per-call being more commonly exploited, then ad space on mobile sites will be more sought after by traditional advertisers, and rightly so.

But, it won’t be long before the decline sets in. As more advertisers arrive, the more likely it is that less value will be delivered behind the click. That will help us to develop our mobile banner blind-spot. Meanwhile, mobile usage will see that the amount of inventory available goes up by at least as much as demand. All that means that the value of banners will decline just as it has online. On big horizontal sites like MSN and Facebook, they go for 30p a thousand – that’s approaching free.

So, for a while, mobile banners will generate good cash for media owners as advertisers try it out. But, once their agencies get round to doing the numbers, something won’t add up and commoditisation will hit the mobile sector too. Maybe then, while all that plays out, we should be focusing more attention on where lasting value is likely to be.

Search has shown us how ‘advertising’ really works on the web – and it’s not really advertising. We look for things, it offers links to those things. That some of those links are paid for is neither here nor there – in fact, when you consider the investment in SEO, they’re all paid for.

The same thinking has to apply to mobile – to deliver monetisable services not advertising messages – and that’s why I’d think hard before I bought a load of mobile ad banners, even from Nokia.

It's something of an urban legend - though I'm told it's utterly true - that, in the Far East, a mobile phone user can barely walk past a vending machine without pointing their device at it to buy something. Books, cans of Coke - all sorts are bought through phones and added to their usual monthly bill for payment. In the UK, that functionality has been on the radars of most in the industry for years. Now O2, which has just conducted a trial of such technology with 500 users, says it was a screaming success and is ready to bring it to market. So what does that mean for mobile marketers?

Well, if you follow the whole 'valuing interaction' model (see here for what that means), then mobile phones as cash utterly completes the circle between promotion and sale and should therefore open the floodgates to marketing budgets. For, once sorted, the mobile wallet means any marketing work delivered through the mobile as the media channel can be connected directly to sales in a way that even web work can't.

ISPs could have worked to use their monthly billing relationships with users to allow them to add web purchases to their connection charges, but it never happened. And, even if they had, the mobility of mobiles (!) takes us a significant step further, since it ties mobile marketing to offline sales – a link that the web has battled for some time to prove exists.

So, we dream up an ad, we send it to users’ phones, they are utterly convinced, walk to their nearest store (which we point them to using GPS and mapping functionality), wave their phones (complete with discount voucher) at the nearest payment thingy and walk away with their goods. It’s advertising utopia, and a sure way to the inside pockets of marketing directors.

In all likelihood, this kind of thing will only work for small ticket items – drinks, chocolate, crisps, tube tickets (Oystercard top-up was featured in the O2 tests) and the like. But, interestingly, these are the very types of brand that have struggled to make sense of the direct-response dominated online world because no-one buys sub-£5 items online. And, since it never proved to be much cop at brand advertising, that utterly limited the value of the web as an FMCG ad medium.

So, not only will mobile wallets make our lives as consumers much more whizzy, they could also open up some large doors to bigger digital budgets.

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New data tells us that the US is catching up fast when it comes to web browsing through mobile phones. According to Bango data, 'the top five countries accessing the mobile web via Bango in July 2008 are the UK at 19.35%, the US at 18.88%, India at 10.82%, South Africa at 8.82% and Indonesia at 4.08%' and the US is likely to overtake the UK 'as early as this month'.

This is key for lots of reasons but chiefly because, as Bango points out, if consumers in the US are getting interested then so will US businesses. For UK competitors that's a boon in the short-term. US investment and technical expertise will bring with it a raft of new applications, platforms and services that will drive the use of mobiles on the web throughout the developed world. In the long-term it is likely to mean that UK and European players will become consumed.

Much has been made of the UK's head-start in the mobile space. It can be most put down to the early stage at which operators agreed rules on inter-operability, for example, for text messaging. But the head-start is over and the iPhone has been, once again, a major driver.

On the web we saw a trend by which separate countries developed their cultural, technological and commercial environments independently. After a period of this island-based evolution, the most highly developed businesses then set out to conquer new territories. Those to have reached that state in the US proved to be the fittest and there remain hardly any UK-owned, multi-national web businesses - in fact, only Cheapflights occurs.

There appears to be no reason to expect anything different in the mobile battle for survival. The start that the UK had was the opportunity to have boats stationed outside territories such as the US when the market was ready for invasion. That time has come but the feeling is that we're still ship-building.

For users, that's fine. A Darwinistic philosophy always means the best will emerge and overcome. So we get the iPhone, hopefully we'll get a Gphone and businesses like DoubleClick will allow mobile advertising to function properly. For the mobile market, these are all good things. But, if you fancy getting nationalistic, then we'd probably best stick to cycling.