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  Telcos' Role in the Advertising Value Chain
Exploiting customer data and attention
3rd Edition, November 2007
Includes new analysis and data from two major industry brainstorms (London and New York) held in March.
A report identifying how to build a valuable new business model and customer base.
This report uniquely answers 3 key questions:
1. What do Advertisers want – which needs of the Advertising community are not being served by existing digital and non-digital channels?
2. How to respond commercially – how should operators position themselves in the digital value chain to add value to users and advertisers?
3. How to develop strategy – what do operators need to do to: exploit their existing assets, develop new skills and assets, and realise the opportunity?
100 Pages, 40+ charts, Slide-based format, Best Practice Telco 2.0™ Case Studies, New Primary Research, Practical Market-by-Market Telco 2.0™ ‘Telcos In Advertising’ Roadmap.
Background
Fixed and mobile voice and data revenues are in free-fall in most European and North American markets. Since the 3G auctions at the turn of the century, content has long been considered the key future growth area for operators in the consumer segment. However excluding SMS, the only material content revenues for Telcos to date have been through movement into adjacent markets – particularly acquisitions in the cable and media sectors.
Through advertising, operators have a potential opportunity to:
- Reduce the price of content and services to end-users;
- Increase the volume of available content and services, and
- Provide value to the advertising community
To achieve this they must contribute to the development of a differentiated new advertising channel in which users are provided with a portfolio of content and services supported by contextually-relevant advertising.
Operators have an opportunity both to provide their own advertising-funded services as well as become an enabler to the advertising community by helping advertisers interact more effectively with their targets (who may or may not be Telco customers). In this report, we examine both of these opportunities in both the fixed and mobile markets. We explore in detail what advertisers and users really want and the opportunities available to operators to carve out a valuable role in meeting those needs.
Key Questions Answered
This report seeks to help operators and vendors maximise future advertising-funded service opportunities by answering the following questions:
- What is the rationale for advertising-funded services?
- When will the market take off and how big will it get?
- How can operators prevent cannabalising existing revenue streams?
- What are the needs of the advertising community?
- How should operators work with Internet enablers (e.g. Google), content providers (e.g. Sony) and aggregators (e.g. Motricity)?
- What implementation issues need to be resolved?
- What are the options available to operators to add value and what is the best option available?
- What are they key factors for success?
- What value is there in opening-up Telco assets (open APIs etc.)?
- Which can be learned from market-leaders in advertising-funded services?
- What are the attitudes of operators, internet enablers, content providers and aggregators to the market and how to be successful in it?
- What needs to be done to develop the market and generate near-term benefits?
Contents
- Executive Summary
- Background and Key Issues to Date
- Growing Pressure on the Existing Operator Business Model
- Content Delivery: Not a Panacea
- Advertising-Funded Services: Tried and Tested in Adjacent Markets
- Telcos' Role in Advertising: Market Scope
- Activity from Operators to Date
- Advertising-Funded Services – Threat or Opportunity?
- The risk of cannibalising existing revenues
- Internet players – partner or competitor?
- Show me the Money! – How big could the market be?
- Understanding the Advertising-Funded Value Chain
- Value Chain players in Internet Advertising
- What do Advertisers *really* want?
- Options for the Operator to add Value
- Key Skills and Assets Required
- Issues to resolve
- Operator role: The Devil in the Detail
- Who to Partner with and How
- Meeting Advertiser and Customer Needs:
- Return on Investment
- Customer attention & interaction
- Performance measurement
- Ubiquity
- Legal and Regulatory Issues
- Learning from Web 2.0
- Content and Communications: Two sides of the same coin
- Social Networking Communities and Advertising
- Case studies:
- Learning from the Master: Google and the Art of Ad-Funding
- Accelerating the need for Advertising Revenues: The X-Series from 3
- The Whole Hog: Blyk’s Advertising-Funded MVNO
- Delivering an Open Platform: Amazon
- Views from the Industry - new primary research by STL
- Action steps & Conclusions
Accompanying Workshop Module
STL is expert is running in-house workshops to help teams process the ideas contained in the report.
We cover issues such as:
- How big is the Ad-funded Services opportunity and when will the market in mobile develop?
- How can ad-funded and user subscription business models co-exist?
- How can operators add value to the digital advertising value chain?
- What is the best approach to partnering with internet players and advertising agencies?
- How important is it for the operator community to provide an open standardised platform to connect advertisers and users?
- What can be learnt (and applied) from Web 2.0?
- What are the practical steps for moving forward?
Our ‘Mindshare’ approach combines stimulus presentations, projective exercises and collaborative technology to help your teams create consensus on what needs to be done.
Workshops can be half day, full day, or 1.5 days, on site at your offices.
For more information please contact us.
Who Should Read this report
Advertising-Funded Services should be read by those in operators and vendors responsible for the developing alternative business models for all services.
This is likely to include management from the following functional areas: Strategy, Marketing, R&D, Product Development and Management, and Operations.
Pricing and Payment Options
* Dedicated license for 1 named individual.
** Dedicated license for up to 5 named individuals within an organisation.
*** License for all employees within a named organisation.
NOTE: UK VAT at 17.5% is chargeable on orders from all UK customers and from non VAT registered customers in other EU Member States. Please supply your EU VAT registration number or add 17.5% UK VAT to your remittance.
Telco 2.0™ – Half or One day In-house workshop
Price on Request.
For information about purchasing and payments, please contact us at contact@telco2.net or call + 44 (0) 20 3239 7530.
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Updated 28 March 2008
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