FT's Grimshaw: Publishers Need To Be More Aggressive With Mobile Strategies, Or Be Left Behind

LONDON -- For all the talk about mobile media, industry executives probably don't yet understand the extent to which consumers are living their lives on mobile devices and platforms, Rob Grimshaw, managing director of FT.com, said during a keynote Tuesday morning at OMMA Mobile Europe.

There are 1.1 billion subscribers of 3G services; there is 37% growth worldwide and 29% of U.S. adults have a tablet or eReader. Mobile usage is overtaking desktop usage, and for those in emerging countries, the Internet is predominantly mobile.

Mobile changes the way we engage with content totally. You carry it around, and it gives you all the things that you want at any time -- the news you're following and the relationships with family or friends, for example, he said.

According to Grimshaw, there are now more people accessing FT on mobile in the morning than desktop, especially in the early part of the day. Most importantly, there's a disparity between time spent on mobile devices and the ad spend: only 1% of ad spend is dedicated to mobile, compared to the 10% of our time spent on mobile. 

The mismatch, Grimshaw said, is driven by ad servers and the lack of connection to mobile devices, and lack of user and browser tracking. This means advertisers can't deliver the experience they want. From an FT point of view, the business has had to solve these problems for itself. The lack of appreciation of how big mobile is is also holding back market development. If consumer time spent on mobile gets beyond 10% and publishers don't capitalise on this, it could be disastrous, warned Grimshaw. 

The technical barriers that have to be overcome include an increasing number of players, device manufacturers, ad networks, platform creators etc. Publishers need to be aware: if they don't move quickly, the party will be over. The marketplace can get to scale, but where is the money going to go? 

Grimshaw cited figures: Google takes around 54% of ad revenues on mobile. Together with other players including Facebook, Apple, Pandora, Twitter and Millennial Media, they make up two-thirds of the market. Publishers have not featured yet, and are being squeezed into that one-third rest-of-market. 

The way to deal with this is to try to get ahead of the curve, Grimshaw advised. The creation of a single subscription across all devices and apps was the right approach for FT. As consumers adopt new devices, they find the FT is already there.

The FT Web app signals the major strategic challenges that publishers will face and benefits of taking a bold approach -- it allows download without gong to the app store. FT did this because going under iTunes terms would have fundamentally damaged its direct relationship with consumers. Moreover, it couldn't have enabled a multichannel experience, or wouldn't have been able to manage subscription churn.

But most importantly, Apple takes 30% of the revenue. If you're a publisher with your own billing platform, why would you pay 30% to use someone else's? Grimshaw asked. "It was the most nerve-wracking day putting it out there,' he revealed. 'But it has worked, and has demonstrated that you don't need to go through a big platform."

Over the last 12 months, as FT has stepped out of IOS and into HTML5, it has seen 77% audience growth (from May 2011 and May 2012). Discoverability is easier and "it's easier to reach the audience outside of environments like Apple iTunes. You can forge your own direction," Grimshaw said. 

FT is turning this into money: 15-20% of subscriptions sold every week are on a mobile device. People are transacting on devices, he stressed. Advertisers are interested and making the investment. FT is serving rich media ads and providing the sort of tracking found on the desktop.

FT.com is now making 10% of ad revenues on mobile devices. Advertisers view mobile as a branding environment when given the right tools, targeting and formats to express their message, he added. 

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