What Does Apple’s Patent Trial Victory Over Samsung Mean To You? Nothing.

From my Forbes.com blog The New Persuaders:

Apple scored a big victory in its smartphone patent infringement case vs. Samsung late Friday afternoon as a jury awarded the victor $1.05 billion in damages. But does the closely watched verdict mean anything to consumers?

No–at least not for now. Why?

* This case no doubt will be appealed. That means little is likely to change anytime soon, at least until Apple files for injunctions against the Samsung products involved. And those are by no means all of Samsung’s products, let alone other Android smartphones.

* You won’t have to surrender your Samsung smartphones or tablets or worry that some court-induced software update will cause your device to stop working overnight. However, it’s quite possible an injunction that Apple surely will request could stop further sales of infringing devices such as the Samsung Galaxy S II in the U.S.

* Smartphone makers will find new ways to emulate (if not copy) Apple’s features. Patent infringements are often worked around by tweaks that are not very onerous for users, even if they’re a costly hassle for the infringer. So one way or another, it’s hard to imagine that nothing but the iPhone and iPad will have scroll-bounce, pinch-to-zoom, and tap-to-zoom, the features targeted in the case, or something very similar, forever into the future.

* The two companies, with Google lurking in the shadows, might go back to the bargaining table. Samsung won’t have many chips, of course. But it may still be worthwhile to Apple to find a way, perhaps by demanding a very large check or by getting Samsung to back off on other patent claims vs. Apple, to end the hostilities and avoid the costly appeal. Not least, Apple would avoid pissing off half or more of all smartphone owners who just wanted a good smartphone and got caught in the patent crossfire. …

Read the complete post at The New Persuaders.

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Facebook’s Faster New iPhone App: It’s For Advertisers Too

From my Forbes.com blog The New Persuaders:

After fielding a mobile app that was widely panned for being achingly slow to use, Facebook has launched brand-new apps for iPhones and iPads that are much speedier.

Speed is something users can never get enough of, but in this case, Facebook surely isn’t aiming just at its users. Speed matters just as much to advertisers. And advertising, especially on mobile devices, matter a lot to Facebook these days, since it’s seen by investors as struggling to make money from its users as they increasingly access the social network from smartphones and tablets. Some 543 million users, or half its base, access Facebook from a mobile device.

In particular, the new apps update the Facebook news feed in real time, so users don’t have to manually reload the page to see them. That’s key for Facebook’s mobile advertising hopes, since Facebook earlier this year began allowing advertisers to run so-called Sponsored Stories, or posts from one’s friends that marketers pay to highlight, right in people’s mobile news feeds. Now, those ads, like other posts, will be able to appear faster.

Why is that so important? Because real-time ad placement, already a staple in more “traditional” online advertising, could be a big key to success for Facebook’s mobile advertising, especially as it expands its ad exchange announced in June. “Mobile devices have put people in charge of their experiences,” Cindy Murphy, VP of brand activation at social advertising firm RadiumOnesaid at MediaPost’s Social Media Insider Summit today. “It’s more of a real-time experience.”

In particular, advertisers are keen to reach people at precisely the moment they’re ready to eat lunch at a restaurant or grab a coffee at a local cafe. To do that, they need to know where people are at a particular point in time and, more importantly, they need to know an ad for a discount or coupon will get to them instantly.

Speed in ad delivery is key for another reason, too. It’s becoming clear that standard Web ads simply shrunk down to smartphone screen size won’t cut it, but not simply because of the screen size. A bigger factor may be that people view their mobile devices as much more personal than personal computers ever were, so they loathe being interrupted while they’re doing things on it.

A better opportunity for marketers, then, may be the moments in between activities, when people are already switching gears anyway. “There are natural breaks in television,” says Chris Cunningham, CEO of appssavvy, which helps create ads for social and mobile companies. “You can find natural breaks in mobile too–such as between levels of a game. They can be in the form of a large, beautiful ad.” But those moments are, well, momentary, so that’s why speed matters there as well.

So as much as you may enjoy a Facebook app that’s speedy, advertisers–and Facebook itself–may like it even more.

Can Social Networks Ever Make Money On Mobile Ads?

From my Forbes.com blog The New Persuaders:

If there’s one thing that dogs Facebook among investors, it’s whether it can make the leap to mobile devices–and bring its advertising along with it. Although Facebook claims some success with its mobile ads so far, they’re still a relatively small portion of its revenues, and it’s not apparent that it or other social networks can translate their ad formats to small screens where people are way more sensitive about interruptions to their activities.

What Facebook and other social networks from Twitter to Tumblr need to do, according to a panel of marketing folks at MediaPost’s Social Media Insider Summit in Lake Tahoe today, is to realize that they can’t simply slap smaller versions of their display ads onto iPhones and iPads. Instead, they must try to catch people in the moments in between activities on their phones when they’re most receptive to relevant marketing messages.

On the panel were moderator Erik Sass, a reporter at MediaPost; Kate Bare, product manager for innovation at Expedia Media Solutions; Gabriel Cheng, group head of media solutions at Ansible; Chris Cunningham, cofounder and CEO of appssavvy; Cindy Murphy, VP of brand activation at RadiumOne; and Nathaniel Perez, global head of social experience at SapientNitro. Here’s what they think will work (and not work):

Q: What doesn’t work with social advertising on mobile?

Cunningham: Using the same old, same old techniques and trying to apply them to a new medium. We know people ignore ads. This next generation is about people and users.

Murphy: Mobile devices have put people in charge of their experiences. Consumers are not going to engage with the usual (ad) content. It’s also more of a real-time experience.

Perez: Beyond just social and mobile, the rate of change has outpaced marketers’ ability to adapt. Content that’s relevant and delivered in the right way remains key. We have still failed to shift from interruption (marketing) to experiences.

Q: So we need to avoid interrupting the users’ experience. Does that mean mobile display is dead?

Perez: I don’t think you can write it off. It’s about delivering relevance in the moment. The real problem isn’t about screen size and layout.

Cunningham: Display today and how the ad networks are selling it (is the wrong way). We have to go back to big, beautiful ads. People are scared to interact with ads because they might be taken away. There are natural breaks in television, and you know it’s going to come. You can find natural breaks in mobile too–such as between levels of a game. They can be in the form of a large, beautiful ad. …

Read the complete post at The New Persuaders.

What Startup Buyout Frenzy Says About Social Media’s Future

From my Forbes.com blog The New Persuaders:

Despite the resounding thud of Facebook’s disappointing initial public offering of stock, social media still looks like a huge opportunity for marketers–and for the rapidly expanding ecosystem of companies looking to help them understand how to operate in the new medium. So social media enablers from Buddy Media to Vitrue to Wildfire Interactive have been snapped up for big money recently by seemingly unrelated companies such as Salesforce.com, Oracle, and Google.

What’s up with that? Essentially, it’s a recognition that social media can’t be successful in marketing unless it’s connected to a brand’s other marketing efforts, from traditional and online advertising to public relations. Much of the infamous dissatisfaction of brands such as General Motors with Facebook advertising stems from their relegating social media to a little experiment rather than figuring out how it’s unique and how it best meshes with other marketing channels.

That was the message from a panel this morning at MediaPost’s Social Media Insider Summit at Lake Tahoe, which is streaming live online. The panel included moderator Jackie Cohen, director of social media and communications for marketing consultant TicularMax Kalehoff, VP of product marketing for social media marketing firm Syncapse, which recently bought Clickable, where Kalehoff was VP of marketing; Mike La Rotonda, cofounder and CEO of social marketing platform Votigo; and Jeff Ragovin, cofounder and chief strategy officer at Buddy Media, recently acquired by Salesforce.com. Here are highlights of their repartee.

Q: How is social media evolving?

Ragovin: If you’re not doing social media today, it’s almost a fireable offense. …

Read the complete post on The New Persuaders.

YouTube’s Skippable Ads Go Mobile–Will People Watch Them?

From my Forbes.com blog The New Persuaders:

As uncertainty builds over whether advertising on mobile devices will work anything like their desktop Web counterparts, YouTube today tossed out its bet that they will. In a blog post, Google’s video service said it’s now launching its most successful ad format, skippable ads called TrueView that it has offered since late 2010, on mobile devices.

YouTube credits these ads with juicing its revenues, which Citi analyst Mark Mahaney reckons could reach $3.6 billion this year, or $2.4 billion after YouTube pays its video content partners. On desktop and laptop computers, some 65% of YouTube ads run inside videos are now skippable, but YouTube says only 10% of people always skip them.

They also command 40% higher viewership than ads people can’t skip, which makes advertisers more willing to pay a higher price, knowing they’re getting watched. As a result, says Shishir Mehrotra, YouTube’s vice president of product, YouTube video now produces more ad revenue per hour than cable TV.

These aren’t YouTube’s first mobile ads. It has offered “promoted video” ads as well as so-called “roadblock” video ads that appear an entire day on YouTube home and search pages since last November. But these ads clearly hold the potential to become the most popular format on mobile devices.

At first, the ads will be available only on devices using Google’s Android software. Why? Because Apple’s current YouTube app, the one it developed at the time it released the first iPhone in 2007, doesn’t allow ads to be run on it. Apple and Google recently said that app won’t be in the next version of Apple’s iOS mobile software, which will debut on the upcoming new iPhone, expected now around Sept. 21.

Instead, Google is working to get its new YouTube app, which will be able to run ads, approved for the new iOS. When it’s out, no doubt in coming months, we’ll get a much better idea of how YouTube’s skippable ads fare on mobile devices–and a better sense of whether mobile advertising overall will work.

How To Advertise Without Really Advertising On Mobile Devices

From my Forbes.com blog The New Persuaders:

As more and more of us access online content and services via smartphones and tablets, it’s becoming apparent that advertising that works on the Web viewed on desktop and laptop computers just won’t work as well–or at all–on mobile devices. Just look at Facebook’s stock price, sitting at half its IPO level partly because investors can’t figure out how or even if the company can make money from advertising on mobile devices.

Indeed, many people in marketing are wondering if advertising is even the best way to market on mobile devices, where screen real estate is tiny and people view traditional ads as an interruption. The advent of truly mobile computing, says MediaPost columnist Steve Smith, may allow us to rethink the fundamentals of marketing.

What might work better than banners on mobile devices? A panel at MediaPost’s Mobile Insider Summit today in Lake Tahoe, streamed online, took at crack at it, and panelists had some pretty interesting answers. On the panel were moderator Anna Bager, VP and general manager of the Interactive Advertising Bureau‘s Mobile Marketing Center of Excellence; Lars Albright, cofounder and CEO of mobile engagement company SessionMBrent Hieggelke, chief marketing officer at Urban Airship, a mobile message company for apps; Jon Vlassopulos, CEO of mobile entertainment studio/agency skyrockit; and Brian Wong, founder and CEO of mobile rewards network Kiip. Here’s what they had to say:

Bager says this is the “non-banner” panel. The banner is not dead, she says, but we need to see an evolution of banners and how we advertise on different screens.

Q: How is a mobile user different from a TV, radio or Internet user?

Hieggelke: Mobile devices are much more personal. They’re never beyond an arm’s length from people.

Wong: The person is no different. The usage is a lot more intimate. The smaller screen is seen (by marketers) as an impediment, which is frustrating.

Q: How can you use mobile devices differently from other channels?

Vlassopulos: We hope the differences will wash away. If mobile can be at the beginning of the idea channel, then the other ideas and creative will flow.

Albright: Too much marketing feels random on mobile.

Wong: One of the most exciting things we’re seeing is going beyond trying to spur actions. Tapping into streams of existing behavior has a lot more promise.

Vlassopulos: The notion of interruptive advertising in theory could go away and eventually will go away. If you start to think of advertising as content, and social media has helped here, then people might see it as something they like.

Wong: When you have an intimate relationship with someone, you don’t want to mess it up by constantly yelling at them. You can do that (intimate relationship) with mobile.

Albright: New formats such as rewards and opportunities to engage work better than banners. About 90% of people opt in and engage with these new formats, vs. 90% finding them annoying.

Wong: You need to let people maintain the activity they’re already engaged in. …

Read the complete post at The New Persuaders.

How YouTube Turned Into a Real Business By Making Ads Optional

From my story in MIT Technology Review:

In 2008, when Shishir Mehrotra joined YouTube to take charge of advertising, the booming video-sharing service was getting hundreds of millions of views a day. ­YouTube, which had been acquired by Google in 2006, was also spending as much as $700 million on Internet bandwidth, content licensing, and other costs. With revenue of only $200 million, YouTube was widely viewed as Google’s folly.

Mehrotra, an MIT math and computer science alum who had never worked in advertising, thought he had a solution: skippable ads that advertisers would pay for only when people watched them. That would be a radical change from the conventional media model of paying for ad “impressions” regardless of whether the ads are actually viewed, and even from Google’s own pay-per-click model. He reckoned his plan would provide an incentive to create better advertising and increase the value for advertisers of those ads people chose to watch. But the risk was huge: people might not watch the ads at all.

Mehrotra’s gamble paid off. YouTube will gross $3.6 billion this year, estimates Citi analyst Mark Mahaney. The $2.4 billion that YouTube will keep after sharing ad revenue with video content partners is nearly six times the revenue the streaming video service Hulu raked in last year from ads and subscriptions. And that suggests Mehrotra has helped Google solve a problem many fast-growing Web companies continue to struggle with: how to make money off the huge audience that uses its service free.

In 2008, Mehrotra was working for Microsoft and hankered to have his own startup, but he agreed to talk to a Google executive he knew about working there instead. He decided against it—but that evening he kept thinking about how the exec was frustrated that most ad dollars go to TV, even though nobody watches TV ads. Yet at his Super Bowl party two weeks earlier, Mehrotra recalled, guests kept asking him to replay the ads. Was there a way, he wondered, to make TV ads as captivating as Super Bowl ads, every day?

The answer came to him in a flash. …

Read the complete story in MIT Technology Review.

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