Google CEO on mobile search (Why it's different and what to do about it.)

Posted on June 12, 2008 by Dale Larson

This morning Reuters ran an interview with Google CEO Eric Schmidt reinforcing some of what I know about mobile search and making “do no evil” more concrete.

First, the quote on mobile search and advertising, then some additional info and conclusions on working with mobile search.

Speaking of the emerging market for Web-based advertising on mobile phones, Schmidt said the vast majority of Google searches on mobile phones were done on Apple Inc’s year-old iPhones, which prominently feature a Web browser.

“Mobile looks like it will ultimately be the highest of ad rates,” because ads can be targeted by user location, he said.

Since the iPhone has a small fraction of the market, this tells us that few searches are being done on most other phones. Today, buying Google mobile search ads amounts to targeting iPhone users.

As well, it reminds us that mobile searches are different from web searches in another way — they tend to be more locally focused (and that enhanced targeting can be worth paying extra for).

I recently spoke with a potential client who, even with a small test budget, had trouble finding enough mobile AdWords inventory to buy. It wasn’t the first time I’d heard this complaint, so thanks Eric, for reassuring us about why.

Earlier this week Mobile Marketer ran a good piece on why Search doesn’t play a large role in mobile – yet: Crisp CEO that also reflects his comments:

A surprising finding in the first quarter index is that only 7.51 percent of traffic to the publisher sites in Crisp’s network is driven by search engines.

“Search does not play a large role in mobile yet, and it is not increasing much at all.”

Google accounts for 6.4 percent of the total traffic to the Crisp publisher sites, or an 85.2 percent share of the search engine traffic.

Traffic referred by search trends higher within local properties such as local newspapers and local television.

…local newspapers garnered a 27.36 percent… Local news TV was next, accounting for an 11.75 percent share of traffic from search… Categories such as men/sports, autos, online services, business, national news, magazines, TV and entertainment, women’ lifestyle and youth, in that order, accounted for the rest of the traffic from searches.

Note that what we’re really saying here, is that even on the iPhone (accounting for most current search traffic), people use search differently on mobile than on their computer. This is with the most usable device for the mobile web, the game-changing enabler in that space.

Therefore, it is the mobile context, not the device or dataplans, that accounts for these differences seen in use of the mobile web.

You can expect mobile search to grow as more folks get iPhones (or equivalent), but you can’t expect the mobile context and behaviors to change. Plan for these categories to continue driving most mobile searches, with inventory to match.

This is part of learning to Think Mobile. Users will always treat mobile differently from past media, including the desktop web, no matter how advanced the devices get.

Bonus Quote: On Evil and Changing The World
I’ve always loved the idea of Don’t Be Evil (and the Ten things Google has found to be true). Great to hear how it works in practice.

Even better to hear from one of the world’s most successful companies that making money is a side effect of wanting to change the world, not the other way around.

From the same Reuters article:

When he first joined Google as CEO seven years ago, Schmidt acknowledged thinking the “Don’t be evil” phrase was a “joke” being played on him by founders Larry Page and Sergey Brin.

Schmidt recalled sitting in Google’s offices later in 2001 when an engineer interrupted a strategy discussion over a planned advertising product by saying, “That is evil.”

“It is like a bomb goes off in the room. Everything stopped. Everyone had a moral and ethical conversation, which by the way, stopped the product,” Schmidt said.

“So it is a cultural rule, a way of forcing a conversation, especially in areas which are ambiguous,” he said of how the mission statement works in practice at Google.

Schmidt reaffirmed that the company’s primary goal is not to make money selling ads, whether it is banner ads or ads on Web searches, online video, TV and mobile phones.

“The goal of the company is not to monetize everything, the goal is to change the world … We don’t start from monetization. We start from the perspective of what problems do we have,” he said, referring to big, world-class problems.

iChat for iPhone (text and video)!

Posted on June 6, 2008 by Dale Larson

When Steve Jobs delivers the WWDC keynote on Monday morning, will iPhone have new instant messenger features?

I’d love to see an upgrade to the desktop iChat and add an iPhone version of iChat so that both handle SMS text messages as well as instant messages from AIM, Gtalk, Yahoo!, etc.

I want a record of all IM and text messages, so sync all IM and text messages in iChat like my photos sync with iPhoto. That way I have an archive on my computer. Make them all searchable.

Let me view text messages on my laptop screen if my phone is within Bluetooth range.

Let me video chat from my phone via 3g or WiFi.

UPDATE 9/16/08:
Steve still hasn’t given me any of these features, but last week at CTIA Yahoo! launched OneConnect which does let me see Email, SMS and IM for a given contact in a a unified view, and gives me a socially connected address book. Pretty cool!

Newly launched startup Xumii.com also looks promising as a way to do something similar through the mobile web rather than an iPhone app.

New iPhone Monday: Winning Combination

Posted on June 6, 2008 by Dale Larson

One of the great things about new product announcements is that we get to play “second guess the Product Manager” on feature lists.

Fortunately, Apple design is typically more concerned with overall user experience than narrow focus on a feature list, but let that not stop us from enjoying our game.

Current set of tradeoffs in the iPhone contributed to its phenomenal success, and any new version should strike a similar balance. Development resources are limited. An extra chip adds to the price and decreases battery life. A software feature adds interface complexity or affects another desirable feature.

So it’s just not an option to make a list of “all the things missing” and add those to the product. Still, it’s nice to have a wishlist, and this is Monday Morning Quarterbacking, afterall. I’m sure I’ve forgotten some things I’ve wanted over the last year of using an iPhone. What would you add?

cut and paste
search (the contents of my iPhone)
SMS Forwarding
instant messaging
3G
GPS
MMS
video capture
stereo Bluetooth
bookmark something to browse on my desktop when I next sync (it’s flash or too long or otherwise desirable to have there)
allow allocating more memory to store text messages or email
make it easier to send things to my desktop via Bluetooth (like a URL or photo)
wireless sync’ing

Some I just don’t get. I often want to forward an SMS, and it seems like that would be a fairly trivial feature to add, and something long available on other handsets.

Others, like cut and paste, solve many problems, but certainly present interesting interface challenges. It may have been a reasonable strategy to intentionally introduce the simplest iPhone first and then to introduce new gestures with future releases.

Many of them, while folks say they want them and the geeks clamor for them, I wonder if they’re really worth the costs. GPS, for example.

The location feature using triangulation with cell towers offers something that is good enough for many uses, but without the expense, size and battery issues GPS might add. If I had to choose between 3G support and GPS support, you can guess which one I’d take. Do you need to break out GPS into separate devices and pricepoints targetted to different markets? Or does it need to be available on all devices to grow the market for location-based applications?

Other features, you need one or the other, but can live without both. My biggest problem with no MMS support is when someone sends me a photo from their phone. I get a text message like this, created by AT&T but delivered from the sender:

I sent you a multimedia message. You can view my message w/in the next 7 days via the web at http://www.viewmymessage.com using MSG ID pn0otzx Password jans8move

If I had cut and paste, it wouldn’t be so painful, but as it is now, I have to write down the ID and password before browsing to the link, or try to remember to do it when I next sit down at my computer.

Or, how much do I really need to be able to search the contents of my email if I can only store 200 messages on my phone? Instead, I browse to Gmail online and search there. But I’d love to use the memory on my phone for messages rather than music, and if I could do that, search would become incredibly useful (it’d be nice if it searched my text and IMs as well).

Aside from design and engineering tradeoffs, how do you get the best information about the market in regards to features? How do you find out from users and potential customers about their wishlist items and what mix and what experience are going to sell the most upgrades and new phones?

If you go to existing iPhone users like me, you get a great list of new features that I think might make my life easier. The problem is, I already bought one of these. Are any of those new features ones that would have gotten someone new to buy one? For that matter, how much am I willing to pay to upgrade for my desired features?

After we’ve talked about the features in isolation, you may pick the mixes that you’ll have me try out in mockups and prototypes to get a better sense for how they all work together. Each combination requires so much investment in design work that you can’t try them all.

I’d love to know how Apple has worked over the last year to solve these problems, or even to hear more about the research and design that went into the original release.

I think one of the reasons that so few companies do a good job of designing an overall user experience is that it is so much more difficult than the business task of picking features. Apple keeps showing the business win for going to that extra effort, and I look forward to seeing their latest effort on Monday.

Jobs announces Mac App Store?

Posted on June 5, 2008 by Dale Larson

At MacWorld in January, Jobs had announced iPhone AppStore, movie rental for iTunes and then the MacBook Air. He went on to explain how the Air didn’t need many ports or a DVD drive because you could do everything over the network, even watching movies.

I felt sure I knew what “and one more thing” would be.

Instead, he ended that keynote without “one more thing.”

Will he announce it in his keynote this time at the Apple WWDC Monday?

The one thing you can’t still do with an Air without a DVD drive somewhere is to install most commercial applications. I need to do that on my Air just like I need to do it on my iPhone.

A perfect “and one more thing” would be to announce that iTunes would support application sales for Mac and Windows.

iTunes struck compromises that revolutionized the business of promoting, distributing and selling music. It wasn’t perfect, but it solved enough of the problems of labels, artists and listeners to build with iPod into a perfect storm. It could do the same for applications.

iTunes made it easy to find all the music you want in one place.
Made it easy to buy, even at $.99 price point — owning a song is just a click away.
With iTunes Digital Rights Management (DRM), you could share, but only so far, and you could authorize and de-authorize computers as needed.

This sounds like what I need with my software applications. A way to get them all from one place, instantly, easy to buy at any pricepoint, and no hassles figuring out what computers I’m allowed to use them on.

Likewise, publishers of smaller applications have difficulties marketing and collecting relatively small payments. Larger applications will have problems distributing their wares if Air starts a trend to more diskless machines. Both have issues of wanting to protect their software against unauthorized copying, and the kind of universal system and compromises in iTunes could work with software.

Can I rent software like I can rent a movie? It may not make sense when a single publisher tries to do it, but if it were supported universally from one interface, perhaps there are applications that I only need for a week at a time.

What about software in the cloud? Many web apps can only monitize themselves through ad-supported models. What if I could pay $.99 and up (one time or monthly) for Software as a Service? I’d use iTunes to find and rate apps, the iTunes payment system to start an account, and to manage my subscriptions.

Would you like to buy and sell software over the air? Would iTunes/App Store make a good model?

UPDATE 12-Jun-08: Apps are the New Singles: Betting on AppStore Revenue.

Verizon buys Alltel to pass AT&T

Posted on June 5, 2008 by Dale Larson

Reuters reports today that adding Alltel’s 13 million subscribers puts Verizon at 80 million, surpassing AT&T’s 71 million. The deal is valued at $28 billion.

Smart move for Verizon.

With US mobile subscribers approaching saturation, there are few options for growth. Verizon moves into rural markets they don’t already operate in. If their estimates are right, the deal is cash flow positive from the first year and saves $9 billion in operating and capital savings over the next three years.

What about cell phone users?

I love having choices in carriers, but the consolidation seems inevitable, and like it benefits me.

The expenses of building scalable networks and systems, of supporting them and of matching pricing is just too large for lots of smaller players to stay competitive.

The failure of the MVNOs shows us how subscribers see wireless as commodity wireless market, and how competitition in this market won’t tolerate any additional layer of overhead.

Ultimately, it should be a good thing for consumers when carriers grow. Economies of scale allow continued downward pressure on wireless prices at the same time as more R&D and infrastructure investment.

Big companies don’t always act in the consumer interest that way, especially when they become a (near) monopoly. However, both Verizon and AT&T are far from being a monopoly. Competing with each other is likely to continue to drive value for the consumer.

Who knows, maybe Sprint will even become competitive again…

before AT&T acquires them to take back #1.

SMS/Mobile Web promotion for In Plain Sight

Posted on June 3, 2008 by Dale Larson

Today’s Mobile Marketer has a long article about promotion for the a new USA Network series:

“This [In Plain Sight] program relied a lot less on our technical ability and more on our creative and strategic ability,” Ms. Lawrence said. “So, from conception to execution, the content of the [mobile] campaign was created by the Hyperfactory with collaboration with the USA Network.”

I’d love it if they had shared more of the thinking behind the strategy and the creative. The article also doesn’t detail the working of the program, but I like to try as many of these as I can.

Turns out, It doesn’t work on my iPhone, and it doesn’t seem to be well-promoted.

Still, it’s an interesting project, the problems are fixable, or at least worth learning from.

I haven’t seen TV spots for this promotion, but I hope they include them during the show and throughout the week. Mobile programs only work as well as the promotion for them.

You start by browsing to a website (online or mobile) where they ask for your phone number. They send you a text message.

Why not let me start by sending in a text message? Isn’t that faster to explain in a TV ad anyway?

Plus, that would save me a step.

It’s still difficult on the majority of handsets to browse to a specific URL. It takes even longer to go get on a laptop and find where to sign up for this mobile promotion on the USA Network website. Plus, I have to know what WAP is, since that’s the name they use in a list of games.

Why not speak in the user’s language and call it “mobile” or “cell phone” instead of “WAP Witness Challenge”?

Once I found the site online, I pick one of four characters to play, then entered my cell number. In a few mintues, I got a text message to my iPhone, replied, then got another:

49737: IPS: Welcome to WITSEC! To confirm your witness, please reply Y to this message.
me: Y
49737: IPS: Ur all set.U’ll reeive 1 msg/wk.Text STOP to end msgs. Follow the link to help Terry in his 1st situation. http://game.inplainsight.mobi/k.jsp?k=14

I wanted to know where the shortcode was hosted, so before I went on with the game, I also sent the ‘help’ command that carriers require:

me: help
49737: Nintendo T&C’s: http://professorlayton.msite.tv Max of 5 SMS/month. To stop, txt STOP. Std rates apply.

Hmm. Looks like this still needs to be updated and the shortcode is being re-used from a prior promotion, whoever is hosting it.

I went back to the earlier message and clicked the link in the text message. My iPhone browser loaded http://game.inplainsight.mobi/te.do.

This rendered a blank screen!

I reloaded and got the same blank screen again.

I copied it into a browser window on my laptop and was able to see the web page I couldn’t see on my iPhone.

It explained a simple scenario and offered me three choices.

The text seemed like it could be tighter, and I don’t understand why this refers to my witness, Terry, as “them” and “they.” Why pick a witness character at all if the following text would be generic?

I tried each of the three choices, each leading to a screen explaining the complications resulting from my actions.

My life as a Witness Protection agent sounds difficult.

All three screens end with the text:

Thanks for playing the IPS Protect Your Witness Game! Continue to secure the safety of your witness by making the best decisions to keep them alive to see another week. Good luck!

So I can look forward to another text message next week, hopefully this time it will render correctly on my iPhone.

Presumably they might also want to send me messaging reminding me of the air time for the next episode.

I like the idea of having a simple game to play along with a series. Getting a weekly text message along with the weekly show makes sense, especially if it serves as a reminder of the airdate.

To ensure the game stays interesting, all witness situations are rotated to make sure that no two witnesses receive the same question each week.

Also, the witness status is completely customized to a particular witness and the answer that the players chose. In essence, there are more than 290 different witness statuses that the players can uncover.

This part of the program doesn’t make sense to me and makes it sound like the program is more complicated than it needs to be to meet the strategic goals or to be creatively compelling.

It doesn’t look like the complexity actually enhances gameplay.

What is the strategic or creative imporance behind having players choose from between several witnesses anyway? Is the suggestion that someone might play this game with more than one witness (or more than once)? Isn’t the whole point to create a mobile subscription list and provide short, compelling content once a week to provide a airdate reminder and that little engagement extra?

I don’t see why this game wouldn’t be good to implement with a text-only option, dropping WAP altogether. The descriptions are text, the choices are text and the result is text. The only picture is of my character.

Sure, it’d take some fancy editing to cut down text to 160 characters, but it looks to me like that might result in an improvement. Mobile thinking requires focus that gets across the most important points and drops the rest.

We like mobile for it’s forced brevity: make things clear and respect our time.

As well, few mobile users in the US consistently browse the mobile web (latest public M:Metrics numbers: less than 15% access it in a given month), so that would have a major impact on potential reach of this promotion. Did they have a strategic reason to accept limiting the demographics targeted to mostly to those with smartphones and the few other regular mobile web users?

Taking that with the quote from the beginning of the article, it sounds like Hyperfactory avoided complex custom programming for SMS in favor of building all the complexity into WAP, and got a little carried away with the creative beyond what would enhance the actual user’s experience.

A different set of compromises could have stayed on strategy, increased reach, maintained creative integrity and been implementable on a budget with many mobile platforms without custom programming.

Wii Fit and Guru Meditation

Posted on May 31, 2008 by Dale Larson

Saw a commercial for the Wii Fit and thought immediately of the Guru Meditation.

(It feels like several lifetimes ago that I was a Software Engineer at Commodore-Amiga. Well before my time that the original Amiga team released the Joyboard controller.)

My recollection of the lore:

The controller was produced both to ensure they had some revenues and to provide a “cover” for the top secret system they were working on.
A simple Guru Meditation game required you to sit on the controller and balance perfectly. They often did so during long compiles.
The system error message with debugging information was named “Guru Meditation” since it would mean fixing code and waiting through another compile.

Googling “Guru Meditation Wii” brought me immediately to the Wikipedia entries for Guru Meditation and the Joyboard, as well as to Ian Bogost’s new Guru Meditation game. (I was lucky enough to have briefly met Iain and enjoyed a group lunch with him at Mobile Persuasion 2007 . His work is amazing.)

UPDATED 9-Jun-08:
OK, now I want a Wii Fit — they did build in a meditation game!

How to do Mobile Marketing Fast and Cheap

Posted on May 30, 2008 by Dale Larson

Text messaging programs with a shortcode often involve complexities requiring good sized budgets and months of lead time to set up. I’ve certainly wished this weren’t the case as I’ve managed many of these initiatives.

Sometimes there are effective shortcuts.

Coors Light recently added an interactive element to ads with a simple text messaging program. Fans txt’d “coorslight” to 44636, opting in for SMS updates on the NFL draft. Subscribers received a series of 31 messages which came as each NFL team made its top pick.

Agency DraftFCB handled the text messaging part of the program, implemented with a free text service. 4Info lets you publish via SMS for free. They are ad supported, selling text ad space at the end of published text messages.

This approach can only handle a small subset of text programs, but is effective marketers who only need simple publishing.

Tradeoffs include:

avoid the considerable time and expense of a new branded shortcode
loose flexibility in sharing the 4Info (44636) shortcode
avoid most of the other costs of a text messaging program
your messages may include ads from other brands
few options for programing, interactivity, integration, and control

Here’s what the program looks like to subscribe:

me: coorslight
44636: Coors Light, the official beer of the NFL is proud to provide NFL Draft Results. To confim you’re 21 & receive alerts, reply PICK + TEAM NAME ex. PICK JETS
me: pick niners
44636: NFL SF@OAK 8/8 10p Reply 1 for NFL San Francisco 49ers score alerts *Courtyard by Marriot. Reply CTYD

I didn’t get a chance to see the TV commercial for this — if anyone has a link, please share in the comments.

Thanks to Mobile Marketer for the article bringing this campaign to my attention. The New York Times has an interesting article on the broader Coors Light campaign including the social media elements.

Comscore buys M:Metrics

Posted on May 28, 2008 by Dale Larson

An web strategy/analyst friend asked on Twitter what I thought of this afternoon’s news that Comscore had purchased M:Metrics.

In more than three years I’ve been doing mobile, M:Metrics has been invaluable for industry usage statistics to give me information in the US and worldwide for facts and figures like what percentage of US subscribers have sent a text message in the last month, or how many have a full keyboard. Their ~120 customers have been large players in the mobile space including mostly carriers and handset manufactures, perhaps some entertainment heavyweights selling ringtones and games in mobile.

According to M:Metrics, of 226 million US subscribers, only 13.5% Accessed news/info via browser in February 2008. They’ve stopped publicly releasing the percentage who text each month, but it’s likely more than 50% at this point. For comparison, they indicate that over 20% play a downloaded game or send/receive a photo.

Thus, smart mobile marketing has included the more common modes to be able to reach as many handsets as possible: voice, text, ringtones, etc., and the best often give users options with one or more.

Mobile web still has limited reach.

Still, M:Metrics recognized the growing buzz around mobile advertising, and thus mobile web, adding products in this market outside what was previously its core anticipating the market.

It seems like more buzz, more startups and more investment has been shifting this way. learly the move paid off for M:Metrics in terms of an acquisition. Comscore is likely in a much better position to sell those services than M:Metrics was.

So is this smart buzz and a smart move for Comscore?

Comscore focuses on web metrics. They want M:Metrics for mobile web metrics.

Honestly, I’m not sure what it would have cost Comscore to build out the mobile web piece it’s buying in M:Metrics. I suspect it might be cheaper to build much of that technology than to integrate it, but I’m just not familiar with the details.

As well, I believe the majority of M:Metrics revenues have come from the rest of its business. I wonder what will come of that part of the business with the Comscore acquisition.

Anyway, back to the mobile web, and mobile advertising.

M:Metrics reports that “smartphone users to spend an average of four hours and thirty-eight minutes per month browsing the mobile Web in the United States.” It seems inevitable that devices and networks will add more capabilities and speed so that the mobile web becomes usable for most mobile subscribers, so that 13.5% number should go through the roof, right? And mobile advertising should go through the roof with it just like the buzz says?

My thoughts on this will have to wait for a later post…

Dale Larson

Adventures in Startups: Tech, Business, and Leadership

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