Why Advertisers Could Pay Your Entire Phone Bill By The End Of Next Year
With more and more people using their smartphones to play games, read the news, and watch video, mobile phones are being used as content devices more than they're being used to actually call people.
But while the content devices we've used in the past — like television and radio — have all required people to listen to or look at copious amounts of advertising in order to use them, mobile screens have yet to see advertising at the scale you'd expect for a device that is now accounting for nearly one-fifth of U.S. media consumption. If they like, people can use their mobile devices without even having to run into an ad.
Russell Glass, the CEO of the B2B marketing company Bizo, says that is going to change. In a column published by AdExchanger, Glass writes that by the end of next year, there will be a phone whose hardware and data costs are paid entirely by content providers and advertisers looking to reach consumers who now check their phones more than 100 times each day.
In exchange for a free phone, Glass suggests that users will allow advertiser access to their mobile home screen, in addition to location and purchase information that would help marketers better target users with relevant advertising. Phone hardware is already cheap enough to produce that companies like AT&T offer certain phones for free to customers who sign up for phone and data service.
"The benefits to the market are endless," Glass said. "First, the cost of manufacturing a mobile device is relatively low compared to the value of this volume of rich, digital user impressions. With some simple math, you could see how a company could profitably fund a person’s device and supporting services just via serving home-screen advertisements."
Glass says this is because the 1.3 billion people who own mobile devices offer enough advertising opportunities that renting their eyeballs to advertisers is more profitable than selling them a phone, in much the same that it's more affordable for ABC to sell ads on Modern Family than to charge people to watch it. And in the era of big data, those advertising opportunities are exponentially more valuable.
Already, Glass points out, Facebook has attempted to turn the mobile home screen into a content mechanism with its Facebook Home customization for Android, which puts Facebook content and apps on the home unlock screen. The start-up Locket has also made inroads toward monetizing the home screen by paying Android users a small stipend to run ads on their unlock screens.
Still, it remains to be seen whether Glass's prediction will come to fruition. After all, given how attached everyone is to their mobile devices, it's entirely possible that device manufacturers could make money from home-screen advertisers and continue profiting from device sales to consumers.