Mobile operators are entering the mobile advertising business in a big way. Telefonica and Sprint have formed a mobile advertising alliance to provide a platform for brands to target the two operators’ 370 million mobile subscribers worldwide. The deal is a tie-up between Telefonica Digital, the Spanish-based operator’s digital arm, and Pinsight Media+, US operator Sprint’s recently-launched advertising arm. Spain’s Telefonica is also the owner of Terra, a web portal and internet access provider in the U.S., Spain, and 16 Latin American countries.
Targeting the U.S. and Latin AmericaBoth companies have said that they will “explore efficient ways of providing global advertisers and agencies with new and easier options to plan multi country mobile campaigns”.
Selling U.S. based advertisers into Europe and Latin America
The initiative will initially target the US (via Sprint) and European and Latin American markets (Telefonica) but plans to grow “further in scale, particularly to include Asia”. “Through this alliance, we are seeking to efficiently expand our capabilities to deliver mobile marketing solutions for US-based advertisers into Europe and Latin America, while Telefonica Digital aims to do the same for their regional customers in the United States,” said Mike Cooley, vice president of New Ventures at Sprint.
Revenue earned from the network will be split among the Sprint and Telefonica based upon how much of each company’s ad inventory is being used for a particular marketing campaign.
Mobile advertising exploded in 2012, with eMarketer projecting in December that U.S. mobile ad spend would nearly triple to $4 billion for the year. Much of this growth is due to Facebook and Google, both experiencing huge growth in revenue from their mobile ad products in 2012.