The typical mobile community/social network has a high number of page impressions per user. So your total inventory could be pretty impressive. But can you make money from it? Probably not enough. 

Advertisers want to reach many unique users rather than high frequency of the same messages to the users. When I ask around it also becomes clear that many advertisers are not happy to advertise on peer-to-peer and user generated content type sites. They prefer a strict editorial site with a big brand. That is poor code for that they want a seriously controlled environment. They do not trust their prospective and existing clients in a free social and interacting environment. That distrust is of course questionable and subject of a whole row of other posts. I leave them for now. At the end of the day, the advertisers do not fancy mobile social networks all that much.

But even if you have a great site and everything figured out there are too many business plans chasing very few advertising dollars. On that note there is a great article in the recent Economist. Read it here. And one of the editorials as well in the same issue. Read that one here It’s a summary over that last six years in Silicon Valley at large but applies very well to this. 

So,what to do then? Premium subscriptions, microbilling, advertising? The key here is to think critically about what you really are offering and why. The only rule is to have the guts to ask your users to part with their money (or enough attention so an advertiser wants to pay). But hey, your service is great, right? Then your users would value it enough and feel they get a bang for their buck. So go ahead. Ask them for their money. If you don’t you are running a charity without a cause and I am afraid I have to call you reckless.

Don’t forget the option to mix models. Free ad-funded with a few extra features you have to pay for. I guess this is what many call “freemium” model. Again, here you have to have some pretty good features that you know enough users will pay for. This is when you should count yourself lucky. Because you are in the mobile world. The mobile phone have some unique features that beat the PC. Things like it always being on (the number of people never turning off their mobile is increasing by the day), always with you and always there at the moment of inspiration are features you can monetize if you package it right.

Then you have to pick your fights of course. Don’t be the umptieth service of the same kind in the same market. Speaking of market. The current chaos in the world can be your best friend. Your services are probably not that expensive so make them fun and relevant enough for your users and they will stay with you and bring in new customers for you. In a downturn people seek low cost rewards, treats, closeness to others and comfort. Why do you think sales of chocolate bars, lipstick and condoms seldom dip in a downturn? Some companies will go bust and others will scale back marketing budgets. This means you have less noise to cut through with your campaign, viral guerilla stuff or whater you call your sales and marketing.

So what will you do? Take a brutally honest look at your business. Adjust it. Look your customers in the eye and ask them kindly to put their money on the table if they want to play with you. Hope to see you around this time next year.

I see that as a sign of maturity for our industry. As in any industry that matures each party specialise more and try to build on their competitive advantages. Mobile operators have made huge strides in this direction as well. They have practically given up to become the DreamWorks for mobile content and apps. Their USP is pretty weak compared to the entertainment industry. But EMI or the Guardian are not that strong in offering access to the internet, do the billing or provide localisation data either.

Lynette Luna at Fierce Wireless develops this theme very well in her recent post. Just as I mentioned the other day there are some anomalies hanging around though. Hope that some encounters and discussions outside the MWC09 bubble will make Nokia and some others scrap some plans that just seem a bit too far away from their core. Even though the mobile internet is new, cool, hip and part of a paradigm shift normal business and marketing laws (and even gravity!) applies. Few think Nokia or Samsung when they think social networking. But as a tool to get to the social network of choice Nokia, Samsung and all the others have a great opportunity to be in the game.

However efforts like Ovi Store and others (thanks Steve Jobs for letting the Genie out of the bottle). The Ovi publisher model copying Apple’s 70/30 model makes a case for content developers to actually develop new innovative services instead of porting licensed properties to mobile. On the distribution side Ovi also has the potential for mass market reach, even though downloading a store app to the phone before I can purchase things over the air seems a huge impediment. Is this really going to be the case? I am looking for more details following yesterday’s announcement at the Nokia press gathering at MWC09 in Barcelona.

Another observation to support the statement that the industry is maturing is the growth in the B2B mobile solutions niche. We see mobile solutions companies beyond premium sms providers is growing their business across the board. Maybe some caution is relevant if we include mobile advertising. But the general trend that existing media businesses are mobilising themselves seems to be valid. Here the companies that depend less on advertsing revenue are the ones I expect to take the lead out of the recession. In a short few years I am convinced we will be baffled over how primitive and insecure our baby the mobile web was back in 2009. Yes, I remain the optimist.

Related articles by Zemanta

• Nokia Unveils Ovi Store, Application Sales To Debut In May (techcrunch.com)
• Going mobile in Barcelona (bbc.co.uk)

Isn’t the market much bigger among the users in the “Mobile-Only-Internet-Generation” (Do we have room for yet another acronym? – MOIG). The big dragons Facebook & Co. will/are of course taking a large chunk of the mobile user pie. We start to see some really neat interfaces to the big web players’ communities. And I am not even including  the iPhone interfaces here since they still have to be considered fairly marginal still. But not for long.

Back to the segments that access the Internet only from their mobile (did MOIG work for you?). The drivers for this behaviour are multiple. I guess one driver is directly related to computer penetration in a market. This would explain mobile internet access in South Africa and India to a large extent.

Then we have the more fundamental lack of patience and need for immediacy that is prevalent in many user segments today. A computer is just too slow to boot and you do not have it with you at all times. The mobile is there at almost every moment of inspiration.

A third driver is the privacy coupled with the possibility to be anonymous. Yes you can fake your nickname from a PC as well. However, the small screen and proximity to your face makes the phone the most private media channel we have. I would claim that this enhances the feeling of being anonymous. Even though the opposite is often true since the traceability is much better with an MSISDN than an IP-address at an ISP somewhere.

I should stop exploring the human mind and behaviour now since I am not an expert in this field. I am a human though and frequent interaction with users of various mobile social networks, chat and dating services provides some solid ground for me to stand on here.

On top of this two commercial constraints have disappeared to a large extent: Flat rate mobile data is here to stay (and get cheaper!) and advertising funding allows for distribution and monetization freed of the strong grip of the mobile operators.

My key points then?

1. A closed mobile social network is a dead duck from the word go for obvious reasons.

2. The big web players Facebook & Co. will become big IF they let themselves go of the computer experience and focus on the strenghts of the mobile phone interface and how it can enhance the overall experience of their service.

3. Mobile only players are/will be a big group in the future. We already now see players like itsmy.com, Lifestylers (I am involved here) and others having large user bases.

If you want to discuss this in person and have the opportunity let’s hook up at Wireless Developer Forum in Cambridge 10 March where I am speaking on this subject. The producers have been kind enough to offer  me 100 pounds off the entrance fee to anyone using this link.

Have a nice weekend!