The All New, Improved SMS, sort of

Source: MobileWorld | View Print Article

MALAYSIA, 27 August 2007: Two companies have come up with different solutions that do the same thing: ad subsidized text messages.

It’s no secret that the world loves to send text message. In most places, people send more text messages than make calls. The sheer volume of text message and intense competition between telcos have driven the cost of sending text messages all the way down.

In Malaysia, people get to send text messages for as low as I send an SMS and even for free to certain people under some pricing plans. Nevertheless, since consumers send text messages in high volumes, SMS service end up contributing significantly to the phone bill of consumers.

At the same time, marketers have been exploring how to bring advertising onto the mobile platform in a way that is acceptable to consumers. Two companies believe that ad supported free text messages may be the solution that will work best.

mobik claims to run the world’s first advertising-sponsored mobile services community. It has offers in Australia, Malaysia, Singapore and India and mobiK service is no stranger to Malaysians. The first version of the service has been around for quite some time and, according to Damian Thomas, the CEO of mobiK, it managed to attract 400,000 users in Malaysia.

The first version of the service simply offered free text messages to registered users and they could send text messages to any other subscribers from their PCs. These text messages would have a short sponsor’s messages included inside the text messages. That has been stopped however because spammers were misusing the service to ply their dubious trades.

The new version of mobik now offers free text messages only between registered members of the mobiK community. Damian says that their aim is to build a community of users by giving them a unique social experience. mobiK also plans to add more community focused service in yet another upcoming version of mobiK service.

For now, users must register to use the service. They will immediately be able to send free text messages to other mobiK members from theit PCs. Free text messages can also be sent from mobile phones that support mobile Java. However these text messages are not really free because the service requires a data connection. The mobiK service does not use the regular telco network to send the text messages. Instead, the messages are sent to the mobiK server where ads are inserted into the messages and then sent to the recipient. Consumers on unlimited monthly data plans will not see any increase in their bills but pay as you use customers will be billed by telcos for accessing the GPRS, EDGE or 3G networks.

mobiK sweetens the deal however by introducing ‘K’ money mobiK users can earn ‘K’ money by bringing in more members into the mobiK community and taking part in surveys and promotional contests. The ‘K’ dollars can be redeemed for attractive items.

Over at the advertising side, Damian says that mobiK offers an interseing channel for advertisers to reach consumers. Most of mobiK users, says Damian, fall into the highly prized 15 to 30 age demographic. Also, advertisers will be reaching willing consumers who have agreed to receive these ads. Furthermore, mobiK can offer advertisers precise targeted ads. Damian says that they can direct ads to reach the exact target market for advertisers as their system can control who sees which ad.

Damian also told Mobile World that they are working to bring even more services to the mobiK community. Among the services being explored are free calls and MMS messages.

In the meantime, over in Singapore, another company, Affle has launched their offering which they have dubbed SMS 2.0, short for Short Messaging and Search, Version 2. Unlike mobiK, the SMS 2.0 platform is designed to be installed by telcos and offered as an enhanced service by the telcos.

The UK based company has tied up with advertising giant, Group M to bring the SMS 2.0 service into Asian countries. For a start, Indian mobile operator, Airtel and Singaporean telco, M1 have started using SMS 2.0. Mr. Anuj Khanna, CEO & Chairman Executive Committee, Affle says that they plan to bring SMS 2.0 to ten countries in this region with launches being targeted at Malaysia, Australia, Indonesia, Thiland, Phillipines, China, Taiwan and Japan.

“Affle’s vision is to have mobile phone users around the world make a complete switch from Short Message Service to Short Message and Search, of SMS 2.0. It is an ambitious goal, but believe consumers will be won over by the SMS 2.0 experiience,” said Mr. Anuj Khanna, Ceo & Chairman of Executive Committee, Affle, said Anuj.

Mr. Khanna cited successful pilot tests held in the Singaporean and Indian markets since 2006 as a reason for his optimism. For the Singapore trial, Affle collaborated with M1 to provide more than 2000 users with SMS2.0. Results showed they were much more likely to explore onscreen content and advertisements using SMS2.0 than they were on existing mobile content services.

The SMS 2.0 service, for now, only runs on a limited number of Symbian based phones only. The service also makes use of data connections to send the text messages but because the service is offered through the telco, users are not billed for data usage. Extra charges will only apply if users access permission based special services.

The SMS 2.0 application also has a search function embedded in it that allows users to conduct searches just like they would on a PC. Affle is in talks with various search engines to power this search function.

Affle has also partnered with international content producers including Times Internet in India and Singapore Press Holdings to bring content to users. The news stories and headlines are updated several times daily to ensure that content is current. Users also receive an assortment of content from other providers who publish RSS feeds.

Like mobiK, Anuj says that the SMS 2.0 offers targeted advertising opportunities for advertisers. The cost of advertising is 60 – 80% higher than regular online advertising but according to Affle, major advertisers like Procter & Gamble group and Coca-Cola have signed up.

Affle says that it is working with Nokia to load new Symbian 60 phones with the SMS 2.0 application.

Mobile based advertising has not taken off in recent years. According to analysts, Informa, only USD 871 million was spent in 2006. However, it forecasts that this will rise to USD4 billion by 2008. mobiK and SMS 2.0 are well poised to take adventage of the move towards mobile based advertising but they would be sure to be joined by other entrants over time.