Ad-Supported Content Attracts Wireless Carrier Attention

10:33:01 AM 12/3/99 In today's PagingNOW Guest Column, FANCASTER® Inc., dba, Target Wireless President Craig Krueger discusses the changing fortunes for wireless content providers and carriers. Should wireless content services be packaged as premium services, with monthly fees? Or should wireless carriers offer programming, with advertiser support, at no charge to subscribers? Read on for more details.

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To add value for subscribers, wireless manufacturers and carriers have launched a variety of customized and generic content packages that feature sports, weather, finance, headline news, entertainment, horoscopes, and local traffic. Word pagers, two-way alphanumeric pagers, PCS telephones and wireless computing devices are all capable of receiving wireless data and short messages. But to carriers and content providers alike, the critical question remains: How should these value-added services be positioned? Should wireless content services be packaged similar to cable television, as premium channels with monthly fees? Or, should wireless carriers offer programming, with advertiser support, at no charge to subscribers?

A significant portion of the wireless industry has strategically positioned customized content as a value-added commodity, with pricing built into tiered incremental program packages. An example of this new wireless paradigm is Motorola's i Kno information services. The i Kno program provides consumers a significant portfolio of Web-based information services that can be personalized.

But Bill West, former president and COO of Dial Page and current vice-chairman of Readycom, Inc., says pay services for stock quotes and selective sports information have met with minimal acceptance in the paging industry. "Wireless devices have become extensions of Internet messaging as well as receivers of time-critical news, and financial information. Since the revenue model for the Web is advertiser-based, this could open up advertising revenue opportunities for the wireless industry," West said.

Peter Negelescu, vice president and general manager of content and applications for Excite@home, reports that Excite@home delivers personalized ad-supported content rather than broadcast alerts. Because there are so many free sources of readily available information, Excite does not charge subscription fees for premium content. Rather, Excite derives its primary revenue from both advertising and transactional fees from e-commerce. Excite's strategy is to promote e-commerce. "We are looking at things that drive transactions," said Negelescu.

A review of advertising trends in television is reflective of advertisers' shifting attitudes on how they can best reach their target audience. Throughout the 1990s, the advertising industry has been directly impacted by the progressive dilution of traditional mass media. Less than 20 years ago, television viewers only had four networks to choose from: ABC, NBC, CBS, and PBS. Today, viewers in most major markets can select programming from hundreds of channels.

The proliferation of programming on cable television, video rentals, and the launch of content services on the Internet all have contributed to the decline of concentrated audience share for the major networks and their respective advertisers. Advertisers are realizing it is no longer possible to reach the mass audience once offered by network television. Consequently, demand for media vehicles that deliver niche targets has increased exponentially. Wireless and Internet advertising both possess the unique capacity to deliver a targeted audience composed of active mobile professionals.

The advertiser-supported model poses little or no additional cost to wireless subscribers. Carriers can compensate advertising sales staff on a commission basis. Advertisers have become more and more interested in target-marketing their products and services, and the advertiser-supported model embraces the proposition that subscribers are not likely to pay for content readily available from free sources of content such as television, newspaper, radio and the Internet.

Wireless carriers that position themselves as Internet operators and portal providers are aware of the opportunity to realize first-mover advantage as wireless access to the Internet increases. Increased access is the key to increasing page views to a Web site. Thus, each new visitor to a portal represents increased impression levels. The greater the impression level, the greater the potential advertising revenue.

FANCASTER®, Inc., dba, Target Wireless®,

Craig Krueger is President of FANCASTER®,, Inc.,doing business as Target Wireless, a US company that facilitates the distribution and integration of advertising and other m-promotions which are distributed via wireless platforms including broadcast news alerts, (MMS) multi-media messaging, and broadcast SMS Text messaging services.

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