Category Archives: Android

Nike’s GPS watch and the new age of dongles

This is more than a Nike+ SportsWatch with GPS that allows you to track your runs without using an Apple iPod. It’s proof that we’re entering an age of dongles.

A dongle is technology key, usually a bit of hardware that forces you to use a certain software or operating system. Own an iPod? That gadget locks you to the Apple iTunes store. Dongles started back in the 1980s when software makers would set up unique connection pins so their software could only get power or data if you used the gadget. Today, falling tech prices have led the big content portals to build their own dongles: Droid phones with hot keys for Google search; Barnes and Noble Nooks that sell B&N books; the Amazon Kindle … the list goes on.

Consumers typically put up with dongles because the value of the content they are connected to seems worth it. You probably never think that your iPod constricts you to only Apple-sold music and videos, because the library is so big it feels like freedom, but you’re really in chains.

Now, however, with chip and screen pricing continuing to plummet, niche businesses can build their own dongles. Nike+, an online running log and social community, has relied on Apple iPod dongles since it launched in May 2006, back when devices that only played music were $150 and it took scale to get to market with tech. Today, dolls have cameras and Android tablets that act as microcomputers can be had for $200. So dongles are proliferating. LENA, for instance, is a gizmo that attaches to a baby’s clothing; it listens to all the words spoken to the child over the course of a day, parses male voices from female’s, and then uploads the data into a software program that tells the mom and dad whether they are speaking enough to their child — a Nike+ for language development.

Are tethers good business?

The obvious question is what portals are these new gadgets locking us into? But the deeper query is whether dongles are a sound strategy for marketers. Sure, it’s tempting to want to add technology to your service to lock your users into your proprietary system. Nike is obviously doing this; the new watch is much clunkier than the old Apple-powered ones, which are as of this writing conveniently out of stock. But as more businesses build walls to hold customers, consumers may rebel as they lose the ability to share across platforms. The corporate desire to tie a customer down is diametrically opposed to the human need to connect.

We’ll see how it plays out with Nike on the road.

The comical falling forecasts for mobile ad spend

Übertechnologist Bob Cringely suggests mobile phones are leaping ahead of personal computers and will inevitably become the dominating communication platform on the planet. (He also says digital displays will someday float before our eyeballs, but let’s not go too far just yet).

That could be bad news for advertisers. If you want proof, let’s look at the silly history of predictions for mobile advertising:

– In August 2007, mobile ad spend was projected to be $14.4 billion by 2011 by Strategy Analytics.
– In April 2008, mobile ad spend was projected to be $6.5 billion by 2012 by eMarketer
– In February 2009, mobile ad spend was projected to be $3.1 billion by 2013 by the Kelsey Group…

14. 6. 3. You get it. The reality is mobile spend was $160 million in 2008 and may top $900 million in 2009, solid growth but still far, far from the inflated expectations. The analysts who make money with hyperbole keep stroking it, even if they reduce their forecasts every six months. Mobile advertising has turned into the Great Pumpkin of the advertising industry, a powerful apparition who never quite appears on time.

But people like mobile, don’t they?

Yes, the devices are proliferating — there are now 4 billion cell phones on the planet vs. just over 1 billion personal computers, and the technology of mobile is leaping ahead faster than PCs. Cringely notes that manufacturers of computers, such as Apple and Dell, push major improvements every year and a half and “most of us are unwilling to be more than two generations behind, so we get a new desktop or notebook every 36 months.” Mobile devices, on the other hand, cycle through design improvements in less than a year, and consumers typically upgrade them every 18 months. This dynamic of consumers buying new mobile toys twice as fast as computers keeps interest focused on them. Mobile also fits into the peripatetic lifestyles of the majority of the world’s workers who don’t sit all day behind desks.

Yet advertisers continue to trail behind. The problem is both diminished advertising inventory and fragmented ad media. Inventory is tighter because mobile screens contain 90% less visual space than PC screens; inventory is fragmented because smartphones hold thousands of single-tap apps to get online. (We call this the Google Visual Inventory problem and detailed it in BusinessWeek here.) Add the dynamic of mobile users having less patience to be interrupted on their tiny screens as they try to communicate with friends, and ad space inside mobile doesn’t look pretty.

More targeting, less shelf space

Despite all the fanfare about mobile, we think there’s a reason mobile ad dollars have not yet taken off. Yes, mobile advertising can enable pinpoint targeting, geographic proximity to a retail location, just-in-time marketing, augmented reality to overlay your current visuals. Groovy. But all that targeting has a tradeoff of much less space, and thus fewer ad dollars in the market. Mobile could become the most efficient form of advertising yet … the problem with efficiency, though, is it tends to push older inefficient supply out of the way.

Google, arguably the world’s biggest advertising network, is not taking the threat lying down; its Android OS operating system is not an off-strategy stretch but rather an attempt to build a new mobile ecosystem to house Google advertising. Google also purchased mobile ad leader AdMob for $750 million in stock this month. Google wants in.

We’re sure Google will make it; question is how much. Mobile is a small box and a lot of ads just won’t fit. God help us if consumers ever move to digital eyeball displays.

Your mobile app will fail. So line up some more.

Look at your smart phone. See those colorful apps on the screen? Now ask yourself, what happens when the cost of making one of those becomes almost zero?

It’s happening. Apps are morphing from software into advertising channels because the cost of producing them is plummeting., as BusinessWeek reported, is just one of several companies that allow non-techies to create their own apps for a few hundred dollars. If you sell steaks by mail, you can draft a tiny software icon that offers grilling tips and barbecue recipes. If you are recruiting college students, you could launch a how-to-meet-people-on-campus app that also promotes your higher ed program. The app stores are now an unlimited new marketplace for promoting products, with handy software that provides a service … and subtly promotes your brand.

Bad for long-term loyalty, good for short-term buzz

The bad news is apps stink as a loyalty device. App usage follows traditional power laws in that most consumers stop using most apps after a month; this spring a study by Pinch Media of 30 million app downloads found only 20% of people continue to use a given app after a single day, and after 3 months only 1% of users continue tapping on a given app. Hire an interactive shop and dream as big as you want, odds are that within a few weeks your mobile app will fail.

But what about as an ad vehicle with a given campaign life? Think of it like this. Instead of consumers using Google search to find your web landing page, they’ll now use app stores to find your push-button mobile software. It doesn’t matter if usage falls off from your mobile app because — just as you refresh ad creative — you can launch a series of new apps for pennies next month as well. If apps are almost free, and have a short life, then instead of viewing them as one-off software utilities, consider them as sequenced media placement.

An app a day keeps the mobile in play

Mobile apps were born at 6 p.m. on June 29, 2007, when Apple rolled out its iPhone acknowledging that even with a beautiful touchscreen design, getting on the internet through a mobile browser is a pain. What good is the web in your pocket if you can’t easily tap into it? So tap Apple did, including “apps” with single-touch icons that launch specific internet-based programs. (Google, the current PC portal to the internet, must still be freaking out about this, but that’s another story. And probably why Google is aggressively entering the mobile software business, giving away free GPS directions to keep you paying attention.) Apple now has about 85,000 such mobile programs for the iPhone, and Google’s Android mirrors it — click on this icon and weather, sports scores, or Bloomberg headlines pop up.

As costs decline for building such simple mobile software, we see a competitive marketplace heating up. Brands will vie for shelf space by building scores of apps related to their brand. Imagine Crest with tooth whitening apps, dating apps, dentist location apps, calorie counting diet apps, public speaking tips, personal portraits for your Facebook page … an unlimited array of onramps leading to whiter smiles based on toothpaste sales. The simple mobile app will move away from software to media placement, just another advertising channel.

It is arrogant, isn’t it, to try to build a single mobile app that becomes a “portal” for every consumer to use? As the web has taught us, consumer communication patterns don’t fit into such traps. So if you’re playing with mobile apps, we suggest you move beyond one big idea. Don’t do a single app. Do a hundred. Create a campaign calendar and fill up the timeline with scores of mobile buttons launching like soldiers going to war.

Image: William Hook

A little app problem for mobile marketing

Much has been written about mobile advertising, usually “it’s almost here! really!”, yet one basic challenge remains — handsets are cluttered with multiple web interfaces, and the problem is growing exponentially as new smart phones such as the iPhone allow anyone to load thousands of app buttons to get services online.

So many doorways. How will advertisers intercept them?

To understand the challenge, consider that the common web browser for computers created a single doorway that allowed certain advertising companies to thrive. The reason Google was able to gain a stronghold on internet advertising is that personal computers have only one interface to get online — the web browser. Google could become a popular search portal because everyone could easily find it within the common browser.

Ah, but mobile is different. The iPhone and Google’s own Android system enable users to load cell phones with apps — software applications for checking stocks, the weather, directions, retail store prices — and each button is a separate on-ramp to the internet. How will advertisers intercept users if users are taking a million different doorways online?

Brian Wieser, global director of forecasting for Magna, recently said U.S. advertisers will spend $229 million on mobile marketing in 2009 vs. $169 million in 2008. But he noted the market remains a “highly fragmented group of divergent advertising models collectively organized around portable media.” Exactly.

Photo: Sigalakos

Google, mobile, and the erosion of 95% of ad inventory

So. What happens to Google if consumers really move to cell phones for internet searches, and 10 out of 11 prime ad slots disappear? What would happen to your business if you had to kiss 10 out of 11 customers good-bye?

It’s pretty obvious, folks. Cell phone screens are small. About 95% tinier than the big window on your desk you now use to access the web. Now think, how does Google make money? By selling pay-per-click “sponsored link” ads on its search results home page. The typical Google page has 11 slots for advertisers. The typical mobile phone Google page has one slot. (Yes, there are “next page” positions, but most consumers never click there.)

This is no pie-in-the-sky threat. Vic Gundotra, chief of Google’s mobile operations, said yesterday that web searches from mobile phones should outnumber web searches from traditional computer screens in just a few years. Google made $16.5 billion in revenue in 2007 largely from pay-per-click internet searches, and it still has no viable mobile model in sight. Gundotra also noted that Google has seen 50 times more searches from iPhones than any other mobile handset — meaning touchscreen devices are the tipping point for consumers learning to really adopt the internet via cell phones.

Investors are currently stoked that Google is pushing Android, above, a consortium to develop a touchscreen mobile interface. We think Google is leaping into mobile OS in pure defense, desperately trying to figure out how to get more ad slots onto tiny glassy cell screens. Search will still work brilliantly from your handset. But you’ll find fewer paid results from advertisers when your screen is 95% smaller, and that cuts to the core of Google’s business. Expect to see a new mobile interface soon in which users can flick through a series of horizontal “pages” … and expect to see more visual real estate on mobile get eaten up by ad inventory. Google’s life depends on it.

The big trouble with Google’s little mobile ads

See that little iPhone “sponsored link” ad at top? That’s all you get with Google’s new iPhone app. Google redesigned its iPhone web interface yesterday. Instead of the “real web” — the actual HTML screen you’d find on your personal computer — Google has mobile-fied a new version just for iPhones, with larger type, a cleaner search window, no need to zoom in, and five friendly tabs for home, Gmail, calendar, Reader, and “more.”

Trouble is, this clean new design shrinks the space allocated for competing advertisers. On regular Google web pages, there are three slots at top and several more down the right side for advertisers to jockey for position with PPC text ads. Hunt for “kitchen cabinets” or “bariatrics surgery” and 9 or 10 providers vie for your attention. With this new iPhone app, we see … one little slot.

There’s lots of talk about the Google redesign, including some hinting that Google is dumbing down the iPhone interface to make way for its Android consortium in the near future. We think the real story is Google is strangling the very channel that made it successful by limiting advertising slots. This design move may have been unavoidable as consumers move to smaller internet screens … but if inventory gets too tight, advertisers may search elsewhere.

Game over: 3 reasons why Google Android will fail

Google has released the SDK software development kit for its mobile application, the first images hit CNET — and it sucks. The screen shot above shows a prototype for the Google cell phone software, poised on an old, circa 2007 cell phone with plastic buttons. Sure, it’s early in the game, but we see a man down on the field. In fact, the field is on fire and the crowd in the stadium is running for the door. Here are the 3 looming failures.

1. Hardware design counts. And Google can’t do hardware. Mobile phones are migrating to 4-inch-by-2-inch touchscreens, and there is only so much you can do with a GUI that size. Google is a genius at indexing and sorting content, but that is not why consumers lust for cell phones. The image inside the screen is only half the battle; the rest is the cool yin and yang of plastic and glass in our hands. We buy them for the same reason we purchase $3 coffee or $300 jeans or $30,000 cars — because some products project our identity, and with phones we want the coolest integrated mobile gizmo of all. Motorola’s Razr didn’t take off because it had a killer interface. The original Razr screen stunk, riddled with broken pixels and poor resolution. But it was thin, it had little hard edges that resonated on the thumb and index finger, and when you flipped it, it swiped open with a wrist-resonating thunk. The interface was thought through, and it felt right in the hand, like a pistol on the range in Montana or the rubber tip of your pencil on the first day of school.

2. Microsoft will be back. And Microsoft is ticked off. Redmond, Washington has been absent from this recent dialogue over new cell formats, but you better believe with the future billions of mobile ad dollars at stake, Gates & Co. are revving up a new, improved Vista Mobile for cell phone systems. The current Vista is a joke, chocking PCs with its GUI gumbo, but we have to believe Microsoft will not cede mobile communications to Apple and Google. Microsoft has screwed up royally, relying on PC software (soon to be obsolete) and dragging out a horrible release of its new OS. In the magical Potter-esque tale of technology, you know Lord Micromort will be back.

3. Apple is ahead of the pack. And Apple runs fast. Cell phones require content and look and feel. Look and feel are most important. That’s why your kid owns a Razr and you still want the iPhone. Design is not about consensus, it’s about vision. Some say Steve Jobs is a jerk, but he’s also a genius, because somehow he pushes design through.

Good luck Google, with the design consortium. But here’s betting your stock doesn’t hit $1,000 and that we never use your cell phone.