A major question facing mobile developers today is how to distribute their content — where, in what form, and monetized in what way? Custom-built applications using Java, BREW and other languages, while once the norm, are giving way to mobile Internet deployments. But will the mobile device, like the home computer, become dominated by the web browser and advertising?
Yes and no, the panelists said at today’s “Mobile vs. Web” talk at MobileBeat, moderated by Om Malik of GigaOmni Media. The general consensus seemed to be that applications are being squeezed out by the greater accessibility of the web. “If you’re trying to address a broad audience and you’re choosing between Java and mobile web, at this point I’d say you’re crazy to do Java,” said Skydeck’s Jason Devitt.
There’s a hitch: Applications are favored by many because they’re more easily used to charge monthly fees. “You’d be amazed at how many people are willing to pay $2-3 per month for a premium application,” Myspace’s Brandon Lucas said of his own company’s mobile offerings. And later, he also admitted that those people are a source of long-term recurring revenue because they forget they’re being charged — something Mike Baker of Nokia called the “sleeping dog” business model.
But Myspace is also gearing up a big push into mobile advertising, which works better on web applications. Facebook, too, is expecting significant revenue from mobile ads, despite a lack of information on how advertising really works in mobile. “The industry isn’t spending time figuring out what the value of a click is on a mobile device,” Baker said. Advertising budgets for mobile are steadily fattening, but just as with the web, advertisers will sooner or later demand evidence of results — or else they won’t pay much per view, or click.
Despite the uncertainties, both MySpace and Facebook, represented at the event by Jed Stremel, are betting big on revenue from mobile advertising. Applications aren’t as good for that because ads tend to be hidden deep within the apps, making them less accessible. They’re still useful for conveying a unique, more full-featured experience than the web can offer. But for most mobile startups, web deployments will be the frontier of the future.
And as with the Internet, the economics will be in large scale. “We’re beginning the golden age of mobile,” Stremel said. “People will find a way to get tens of millions, maybe hundreds of millions of users, and monetize them.” Such wide-scale adoption would be nearly impossible for opt-in subscription fees, but ads would fit the bill.
To round out Skydeck’s contribution, the company also used the event to announce that it’s opening its public beta today. Skydeck, in case you’ve forgotten, collects data from your mobile phone about your calls and clearly presents a report (unlike your carrier). The company has its own call-based social network, and an API for third parties to access its information. If you want to check it out more closely, sign up here.