Mobile advertising is not yet a source of revenue that publishers can bank on, according to Constantine Kamaras, CEO of the Greek sports portal Sport.gr, speaking at the WAN-IFRA conference 'Using sports news to optimise your revenues'.
His publication Sport.gr has around 500,000 unique users per month, with about 15000 registered users. Advertising makes up 77% of their revenue, and mobile 8%. He says that users are less reluctant to pay for mobile content, but warns that mobile advertising will make up at best 6% of interactive advertising in 2010 globally, and will be only 2% in the US, lagging behind social media and online video.
"It's not news that drives the uptake of smart phones," he warned, pointing to other important trends such as search and online communities.
In Greece, there is a high penetration of mobile, and a low but fast growing penetration of smart phones, with very few paid applications. The best-known application, for Greece's leading daily newspaper, has had 15,000 downloads. Mobile is a secondary medium to the web, Kamaras says.
He hypothesises that smart phones will reach basic mass in mid-2010, but will not yet be at critical mass. "Paid applications will be the exception, not the rule," he said, adding that mobile advertising will not take off until mid-2011, when the national economy starts growing again.
His site is a paid service, costing about €3 a month. It does not yet provide unique to mobile content, or user-generated material, and takes minimal advertising. They don't offer alerts. It's too hard to beat the competition, with 30 national papers and 30 sports websites in the country.
They are launching an iPhone app in the next couple of weeks, but have not yet decided whether it should be a paid app or a free one. "It might be more interesting, in the medium term, to have it for free," he said.
SMS polls and contests have worked "spectacularly well," though, because they have raised substantial sponsorship money in conjunction with other partners, and because of the wide adoption of SMS technology.
Their user base is growing, and they are creating extra revenue at zero marginal cost.
"You shouldn't bank on mobile advertising for now," he said, adding that it's a bad idea to lose focus while chasing the next big thing.
He lists coming challenges: whether monetisation should be through advertising or user payments, the trend of convergence on the web, the rise and rise of games, the importance of social networking, and the sell-by date for apps. He notes the importance of real time communication and breaking news to the mobile web, and the need to find ways of delivering video. Open platform APIs are also an interesting strategy, he adds.
In the medium term he expects a two-tiered model, with some user payment and targeted advertising as well.