Is Google Getting into the Cell Phone Business? - The Cell Phone as Platform

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The longer answer was hinted at by Schmidt at the D: All Things Digital conference in May. "What's interesting about the ads in the mobile phone is that they are twice as profitable or more than the nonmobile phone ads because they're more personal," he said. Google's goal has been to get its ads to people at the right place and the right time so that they'll be receptive; that's the whole point of search advertising, after all. Ads that are "more personal" can only further this objective.

When asked about the project, a Google spokesperson would only say that "We are partnering with almost all of the carriers and manufacturers to get Google Search and other Google applications onto their devices and networks." Given what cell phones currently offer users, and what applications might be useful on a mobile platform, these applications probably include Gmail, Google Maps, the standard Google search, and others - perhaps Google Notebook so you can clip interesting items while you're web surfing, Google video search, and Google Calendar.

Whichever applications Google chooses to include in the specs for its handset, you can bet they'll be shown off to their best advantage. But users will probably have to listen to ads. Indeed, the Wall Street Journal notes that "Google even envisions a phone service one day that is free of monthly subscription charges and supported entirely through ad revenue" and quotes its source simply as "people familiar with the plans."

Google clearly thinks this is a worthwhile market. The numbers aren't there yet, but they will be. eMarketer said that global spending on mobile phone advertising was only $1.5 billion. This number includes placement of ads in text messages, web pages, video, and all other content. But that figure is projected to grow more than 50 percent a year, to nearly $14 billion by 2011. That's enough money to make even Google pause - and invest in the future.

But Google faces some serious hurdles along the way. One of these is the wireless operators themselves. Another one, potentially, is the FCC.

Next: Wireless Roadblocks >>
 

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