Messaging Remains Driver of Mobile Ad Market by Cathal OToole - Article Example

Article 1: Messaging remains driver of mobile ad market by Cathal O’Toole Summary In the article, ‘Messaging remains driver of mobile ad market’ O’Toole (2010) discusses the market potential of mobile advertising messaging services. The author opines that the mobile advertisements would help the mobile network operators to garner more revenues to compensate for their decreasing revenue sources from traditional services. Although, analysts had predicted that mobile ad would slow down due to the global downturn, trends reveal that mobile ad instead saw an upsurge while the traditional ad industry faced the burnt. The increased usage of smart phones are also contributing towards the surge in mobile advertisements, as the users are spending more time to search Internet through their mobile devices. Further, the mobile ad companies are able to leverage the availability of detailed profile data of the users and provide targeted ads. Experts believe that in the future the success of the mobile ads would be measured by the purchase statistics of the users and not only by studying the consumer behavior. As per data from PricewaterhouseCoopers and the Internet Advertising Bureau, the media and entertainment sector contributed around 61 per cent of the total mobile ad spend in the UK. However, in most high-growth markets, mobile ads are still being delivered through traditional channels such as MMS, SMS, ringback tones and USSD. As the penetration of smart phones is low in these markets, the marketers prefer to reach the users through traditional messaging methods. The messaging tools enable the corporate to reach out to the consumers on any handset and thereby, help in garnering more visibility and instant reactions for the users. Thus, the messaging services would remain the top choice for many companies to disseminate mobile advertisements. Important developments The article focuses on the developments in the mobile ad segment and how it is helping in the growth of not only the telecom industry but other industries as well by serving as a major marketing tool. The article points out two important developments in the mobile ad segment. The first development focuses towards the increasing use of technological innovations in the segment. The advances in mobile ad technologies are helping the companies to insert targeted ads to a particular profile of consumers. Further, the increased usage of smart phones is also helping the industry to provide ads as per the requirements of the users. However, such a development in restricted in the developed nations, with the high-growth countries witnessing limited penetration of smart phones. Thus, the article provides the second important trend in the mobile ad segment i.e. of the continued use of traditional messaging method to disseminate mobile ads. As any handset in the world is compatible to receive messages, this service enables companies to reach out to a wider audience and receive instant feedback about their products and services. Therefore, mobile ads through messaging would remain an important medium to reach out to the audience. Business applications of the developments In the developed nations, the growth of the mobile ads would be directly linked with the increase in the penetration of the smart phones. The companies in these countries may develop customized mobile ads keeping in mind the configurations of the leading smart phones. For instance, many sites have launched alternate sites for iphone and ipad users in the US. Such customization would help in garnering targeted audience for their products and services, and the company may also be assured of convert customers through such initiatives. In the developing and high-growth markets, the companies would benefit from using conventional messaging services to send across promotional ads to the users. As messages could be sent to any handset, the companies may use bulk messaging services to reach to a wider audience and thereby, gaining a better response rate for their products. However, as the users are generally receiving loads of promotional messages every day, it would be challenge for the companies to capture the attention of the users. The companies need to develop creative content that may attract the audience and convert them into buyers. IT management issues These developments however, would require the backbone of strong IT management. For instance, in case the companies decide to create particular applications for a smart phone to transmit their advertisements, it would require added resources and investments into information technology developments. Further, maintenance of such system would also require robust IT management systems. The applications needs to be monitored constantly and in case of any issues should be fixed immediately. Otherwise, it would dent the reputation of the brand with the consumers. This would require added expense and resources, and hence would increase the total ad spend budget as well. As the application would be an ongoing initiative, the company would have to keep investing resources to keep the application running within any problems. With regards to sending mobile ad messages, the companies might not face any major IT management issues as messaging services are easier processes to handle than complicated mobile applications. Further, almost all the handsets in the world support messaging services. However, in case of sending bulk messages, the company might have to invest into a good server so that the messages could be sent properly without jamming the network. Discussions in the text book The developments discussed above were highlighted in the chapter 6 of our textbooks. Although, not being discussed in detail, the chapter did provide an overview of the above mentioned developments. The chapter stated that “Messaging is a killer app”, which means that messaging would continue to capture the users and generate revenues for the companies. Further, the chapter elaborated on the role of the IS department in maintaining the telecom applications and other technologies. It focused on various new telecom technologies and why it is important to keep track of such technological innovations. It also highlighted on the usage of smart phones. However, the business aspect about the use of technology is not being discussed in the chapter. The impact of the technological development on the businesses is not discussed in detail, but is only highlighted in the case studies. The chapter majorly focuses on the technological innovations and technical aspects of the telecom industry and does not provide an insight about the business implications of such technological implementations. Article 2: Cloud, analytics key tools for today's telcos by Tinniam V. Ganesh Summary In the article, ‘Cloud, analytics key tools for today's telcos’ Ganesh (2010) focuses on the impact of cloud computing and analytics technologies in the contemporary telecom industry. The cloud architecture has many benefits as it helps companies to save costs on computing resources, enable users to buy in an easier manner as well as allow them to pay for their usage only. The article also focuses on the cloud providers and the services given by the major providers such as Google, Amazon and Microsoft. It also provides various guidelines of using such a technology. Together with cloud architecture, another important technology is data analytics. If combined with cloud architecture, companies may analyze and create data models in an easier manner. Further, such a combination help in running multiple queries and help the telecom companies to generate relevant and targeted data. The data analytics tool uses various methods such as neural nets, predictive analytics, classification and decision trees to arrive at a certain conclusion. Thus, the combination of cloud architecture and data analytics would further enable the telecom companies to leverage the best of both the technologies and gather important data. Important developments The article discusses the development of cloud architecture and data analytics tools and how it may help in the growth of telecom industry. It states that cloud architecture would not only benefit the companies but also users as it provide various benefits. Some of the major benefits of cloud architecture are that the technology does not require major infrastructure investment and the companies would not be required to plan for computing resources or maintaining or upgrading the infrastructure associated with the technology. The consumers also benefit from the technology as they are given the flexibility of paying for their usage only. The technology is also elastic in nature and can be expanded or contracted as per the demand. Along with cloud architecture, the article focuses on the development of data analytics. The combination of these two technologies would help in analyzing and processing large data and create data models to generate relevant information. Such information is especially beneficial for telecom companies that are dealing with large consumer data. Telecom companies are investing large amount of money to create software systems for maintaining consumer data, billing records, call details etc. However, culling important trends from such large data can be a cumbersome process. With the use of cloud architecture and data analytics, the companies might be able to solve this problem and generate important information that will help them in serving the consumers in a better manner. Business applications of the developments In today’s competitive telecom industry, the service operators are facing various issues such as increasing tariff pressure and mobile data traffic problems. Although, telecom companies are reportedly augmenting spend on infrastructure development, it is putting additional pressure on their bottomline. The author suggests that telecom companies should instead focus on using technology and investing in them in a judicious manner. Technologies such as cloud computing and analytics have bright future as they provide many benefits to both the users and the companies. Telecom companies need to maintain and generate various consumer data, billing information, call details etc. However, these data are seldom analyzed to arrive at any trends or understanding the consumer behavior. The combination of cloud architecture and data analytics tools may help in identifying these trends and allow the companies to take strategic decisions based on facts and figures. Such technologies would help in understanding the buying patterns of the consumer and thereby, develop strategies to promote the services and ensure customer loyalty for the brand. Further, studying the call patterns would help in understanding the call timings and peak usage hours, which the company may use to create customized tariff plans. Further, the buying patterns of the consumers would help the company in identifying the products that could be cross-sold or upgrading the products and services that the consumer frequently purchases. The buying behavior of the consumer would help the company to create strategies in a proactive manner and tap the opportunities beforehand. IT management issues The cloud architecture involves interacting between various cloud components that communicate with each other through web services and program interfaces. In such a system, each program performs its function and works along with other programs to create greater efficiency. Thus, it enables in controlling and managing the system in a better manner rather than a single interface. The most important architecture of cloud computing are the front and the back end. The back end consists of the services, computers and data storage devices, while the front end is the computer users. Cloud computing architecture As the architecture requires complex networking, there might be many IT management issues that the telecom operators may face. The operators need to focus on creating seamless and coordinated networking between various interfaces, as even a single error would result in the breakdown of the system. Further, security concerns may also arise and the operators should be careful about the networks they are connecting their servers with, as hacking any of the networks may lead the hackers to the operator’s server. Further, with regards to data analytics, the operator should be careful with the information as they are confidential and should not reveal the identity of the user. In order to handle all these issues, the operator should invest in a good IT infrastructure to manage the system in a smooth manner. Discussions in the text book The chapter focused on the technological developments in the telecom sector and discussed various advancements in the wireless telephony sector. However, the latest developments such as cloud computing and data analytics were not discussed in the chapter. Both these technologies have immense potential in the growth of the telecom industry and should be studied in detail. Article 3: Are We There Yet? The Road to 3G and Beyond by Franz J. Fink Summary In the article, ‘Are We There Yet? The Road to 3G and Beyond’ Fink (2010) discusses the applicability of 3G in today’s telecom industry. Fink states that although the technology has been implemented in various parts of the world, it still is facing many roadblocks for a worldwide implementation. Many countries are still using conventional wireless infrastructure and some still has low mobile penetration. Some of the other barriers include regulatory issues, lack of technical standardization, absence of expensive handsets etc. Further, it has been found that consumers are not able to comprehend 3G technology and perceive the services to be complicated and expensive. Fink elaborates on the benefits of implementing 3G and states that the technology would help in enhancing the network capacity and would enable networks to accommodate increased voice channels without clogging them. The 3G networks would be able to provide three times more than the voice capacity of 2G. This would translate to not only increasing the capacity but also increasing the consumer base. Therefore, the operators would be able to enjoy increased revenue and garner a larger subscriber base and better return on investment (ROI). Further, 3G would enable operators to provide increased capacity at lower rates, which would make voice services affordable to the consumers. The features of increasing capacity and controlling costs make the technology attractive for both the telecom operators as well as the consumers. Important developments The article focuses on the development of 3G technology and its importance in the evolution of the telecom industry. The technology has been implemented in many countries, although due to certain roadblocks it has not been implemented worldwide. Irrespective of the barriers, the technology has huge potential to grow in the future and change the course of mobile industry globally. The article states that the technology would ensure enhancing the network capacity as it has the capability of adding more voice channels in its network without any major hassles. Due to its ability to accommodate more voice channels, the telecom operators would be able to increase its subscription base and garner better revenues and return on investment (ROI). This in turn would help in making the voice services affordable and attractive for the consumers. Further, the bandwidth used in 3G technology is much more efficient than that of 2G. The average revenue per user or per unit (ARPU) would also be able to benefit from this technology as it would help in enhancing the network efficiency of the data as well as voice services. Thus, the development of 3G is seen as the most important technology development in the recent times for the growth of mobile telephony. Business applications of the developments The 3G technology would help in providing enhanced voice channels and data services in an efficient manner and at a lower cost. The migration from 2G to 3G would ensure the consumers a better telecom experience and the telecom operators more network efficiency and lower operational costs. The implementation of 3G technology is a win-win situation for both the consumers and the telecom operators. While the consumers would be able to benefit from the increased data download speed, lower call drops and enhanced network capability at an affordable price, the telecom operators would be able to leverage the technology to increase its network and accommodate more subscribers. The telecom operators would be able to provide more voice channels on its network without worrying about network congestion. This would also ensure seamless calling experience to the user without the issues of call drops. The operators would therefore be able to provide better consumer experience and create a brand value for its services, which would ensure more subscribers. The major advantage of this technology is that the operators would be able to provide the services at a much lower costs as compared to 2G technology. Thus, the technology would make the services affordable and attractive to the consumers and increase the subscribers’ base of the operators as well as their revenues, along with creating a brand value in the market. IT management issues The development of 3G technology and its implementation would create more of infrastructure issues rather than IT management issues. The worldwide implementation of the technology could not be initiated due to roadblocks such as continued usage of conventional wireless infrastructure, low mobile penetration, regulatory issues, absence of technical standardization and expensive handsets. Thus, in order to make the technology a success it is important to invest into infrastructure changes at a lower cost. Further, 3G handsets should be developed at a lower cost that provides better efficiency. The issue of power management technology is the major barrier in the development of 3G enabled handsets. The designers are faced with the challenge of creating handsets that could provide better services by using lesser power. Further, most smart phones are costly and high-end; there is a market requirement to create mid-tier 3G enabled handsets. Thus, the development of 3G technology would create more of infrastructure issues rather than IT management problems. Discussions in the text book The chapter discusses the concept of 3G or third generation mobile technology, focusing on CDMA (code division multiple access) standard and WANs for mobile computers. It also highlights on smart phones such as Blackberry and iPhone, running on 3G platforms. Although, the development of the technology is discussed in the text, it does not focus on the roadblocks for the implementation of technology worldwide. Further, it also does not focus on the infrastructure issues that the implementation of the technology might create. Reference Fink, F. J. (2010), Are We There Yet? The Road to 3G and Beyond, Telecom2.0, accessed on October 19, 2010 at http://www.wirtel.co.uk/article_3g_wimax_semiconductor_north_america_core_modem_trends.htm. Ganesh, T. V. (2010), Cloud, analytics key tools for today's telcos, telecomasia.net, August 2010, accessed on October 19, 2010 at http://www.telecomasia.net/content/cloud-analytics-key-tools-todays-telcos?page=0%2C0. O’Toole, C. (2010), Messaging remains driver of mobile ad market, telecomasia.net, October 2010, accessed on October 19, 2010 at http://www.telecomasia.net/content/messaging-remains-driver-mobile-ad-market?page=0%2C0. Read More