• by Ken Liebeskind , September 10, 2002

Is Avesair's announcement of having served 50 million mobile messages across its network a confirmation of the medium or does it still have a long way to go?

The two-year-old company, which has been transmitting mobile messages for about a year, made the announcement yesterday. But Forrester Research analyst Jim Nail downplayed it, saying, "Our research shows that consumer uptake is very slow." Nail argues that most don't have cell phones that can receive mobile messages and those that do don't want to receive them. A recent Forrester study found that wireless adoption increased by 10% last year, with 5.4% of North American households owning a mobile phone or PDA. They are mainly used to send email, check weather and read news, with researching products to buy, the only advertising related service, low on the list of wireless usage activities, according to the study.

But Avesair is eager to trump its service, which charges advertisers a $50 to $75 CPM rate, meaning "millions" in revenue has been generated, according to the company's executive president of marketing Sean Harrison, who wouldn't provide a specific revenue figure. The money is split between Avesair and the publishers who run the ads. The company listed Boston.com and The New York Post as two publishers it works with.

It also mentioned Mercedes and Volvo as two top advertisers, with Mercedes running a campaign earlier this year to promote the new C-Coupe. Sportingnews.com was used to run ads that showed a Mercedes logo, a small picture of the car and invited viewers to submit their email addresses to enter a contest to win a new car. Another Advertiser, SBC Communications, a telecommunications company, inserted toll free numbers into its ad, which enabled viewers to respond directly. "They used one touch dialing to generate qualified leads," Harrison says.

Harrison says the demographic for mobile messaging "goes across the board." He even segments it by cell phone providers, saying, "Nextel subscribers conjure up an image of the outdoors person because of the two way radio feature it supports." He also says youth, early adopters and affluent business people can be reached.

But Nail says these remarks are premature for a few reasons. Anyone with a cell phone more than two years old probably can't access the Web because it doesn't have a browser. And until recently, there were no wireless networks like Avesair's that transmitted the messages. Then there is the problem of consumer interest. "They don't want to get data type applications over the phone," he says. "It's not just the technology and the ad formats, it's a huge consumer perception shift away from the phone as a device to talk on to a device to surf the Web."

Nail compares the wireless world with the Web world in 1988, when Prodigy and AOL were just starting and no one had access. "Consumers wouldn't know how to use it and it took 10 years before they embraced it. The wireless space is the same way with networks just getting into place."

But Avesair's announcement yesterday suggests it may be getting into place. Harrison says it's an ideal way for advertisers to reach a growing cell phone audience and for publishers to reap additional revenue. "It's a perfect way for publishers to gain return," he says. "Advertisers pay to have their promos appear within wireless Web content. We collect it and provide a revenue split."