Verizon to allow Web ads on cell phones

BUSINESS DIGEST

December 27, 2006|By New York Times News Service

Verizon Wireless, among the nation's most widely advertised brands, is poised to become the advertising medium itself.

Beginning early next year, Verizon Wireless will allow placement of banner advertisements on news, weather, sports and other Internet sites that users visit and display on their mobile phones, company executives said.

The development is a substantive and symbolic advance toward the widespread appearance of marketing messages on the smallest of screens. Advertisers have been increasing the amount they spent on mobile marketing, despite lingering questions about the effectiveness of ads on portable phones.

Verizon officials said their initial foray would be a cautious one - they will limit where ads can appear and exclude certain kinds of video clips.

"We know we can make significant dollars in mobile Web advertising in 2007," said John Harrobin, vice president of marketing and digital media for Verizon Wireless. "That said, we likely will not - we want to take it carefully and methodically, and enable the right experience."

More generally, he added, "Mobile advertising is going to take off in 2007."

In absolute terms, the amount of money spent on advertising on mobile phones has been small, but it has been growing rapidly. Last year, advertisers spent $45 million on such messages, and they are expected to spend about $150 million this year, according to Ovum Research, which projects that such spending will reach $1.3 billion by 2010.

The interest of advertisers in the medium stems from a theory that ads placed on mobile phones could create a particularly intimate bond with consumers. The gadgets are ubiquitous and personal, and messages could theoretically be tailored to individuals based on demographics such as age, gender and location.

Numerous factors have limited the growth of cell-phone advertising. Chief among them has been the reticence of carriers to allow ads to appear alongside news, sports and other information that is provided by their official content partners. These partners, from ESPN to USA Today and dozens of others, appear on the content menus that subscribers see when they use their phones to search for information over the Internet.

Carriers have also been concerned about annoying cell phone users with obtrusive marketing messages.

In October, Sprint became the first major carrier to allow advertisements to appear with content that is listed on its menus, or as they are known in the industry, their official content "decks." Cingular, the nation's largest wireless carrier, declined to comment on whether it would allow advertising on its decks.

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