Mobile operators launch phone ad spots
By : Robert Wylot
Poland's largest mobile phone network Era GSM (http://www.eragsm.com.pl) this week plans to launch a cut-price offer for users who agree to a 15-second ad spot during every minute of calls. As part of the deal, users will have a reduced rate of zl. 0.10 per minute, compared to the zl. 1 standard charge.
"The test group of 50,000 users has signed contracts with us and the service in its test version will be launched next week," said Robert Niczewski, spokesman for Polska Telefonia Cyfrowa (PTC), Era's operator, last week. "The test period will last three to five months after which we'll decide whether to expand the user group."
Niczewski said the new offer could be an effective way to reach a broader audience. "The advertisers receive a new medium through which they can reach a defined target group of users who want to receive it," he said.
Meanwhile, PTK Centertel (http://www.idea.pl) has also been testing similar plans since December 2000, with 500 users participating in the project. In PTK's version, callers listen to an ad spot before being connected and receive the first minute of the call free.
"It's a very good idea because it's a new medium," said Konrad Pudlo, co-owner of Wroclaw-based Expert Monitor. "The recipient is concentrating on the ad and can hardly avoid it."
But despite its involvement, PTK remains cautious about the new medium and has yet to decide about expanding the program. "It's uncertain whether this service will attract an interesting target group (of users)," said Jacek Kalinowski, a PTK spokesman. "It could only be people with low income, teenagers for example. In that case, it may prove difficult to find advertisers." As a result, PTK is only offering the service to its more pocket-conscious, pre-paid phone users.
Polkomtel, the third Polish mobile phone operator, is adopting a wait-and-see policy toward the ad scheme. "We have a large share of corporate clients for whom time matters more than price," said Leszek Kaminski, a Polkomtel spokesman. However, the company will be watching the competition. "We have no plans (for mobile advertising), but we are not ruling it out in the future," Kaminski said.
Era chose Polish ad agency Capitol to find advertisers, and contracts with various firms including banks, insurance companies, carmakers and white-goods manufacturers have been signed, Niczewski said.
PTK, which focuses on the fast moving consumer goods sector, is pursuing clients through its own resources but has not ruled out any future cooperation with an agency.
Many in the industry see phone advertising as a new medium, which could a compete with traditional media.
"It is competitive toward other media," Niczewski said. "The trend in advanced technologies is that the operator isn't only focused on its core business (providing telephone infrastructure). In particular in third generation technology (UMTS) we will transmit not only voice, but also video signals. It will be an advertising medium." Pudlo agreed, adding that phones may threaten radio broadcasters' revenues in particular. "It's against radio advertising, (because) it targets the same senses," he said.
According to Expert Monitor, radio broadcasters' overall ad revenue in 2000 was zl. 541 million ($135 million), while broadcaster RMF FM's ad revenue last year was more than zl. 220 million ($55 million). Anna Kozlowska, the station's spokeswoman, said the company was not concerned about competition from phone operators. "I don't think it will affect radio broadcasters' revenues," she said. "I can't imagine phone calls interrupted by advertising spots because that would be just too annoying."
Mobile phone users tend to agree. "Just imagine, they would send me a silly advert while I'm having a private conversation on the phone," one user said.
At least a dozen companies in the world offer the cheaper, ad-laden telephony, to limited degrees of success. Norwegian fixed-line operator GratisTel has attracted only 85,000 customers since its service was launched in May 1998, while Denmark's Sonofon has only 73,000 users after operating for more than two years.
