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June 28, 2010

In the last few days, rumors have started surfacing that Microsoft has plans to position its upcoming Windows Phone 7 device as an ad-serving machine. Just a rumor for now, but there are some that have apparently overheard officials at the software giant say that Microsoft really wants to move ahead with the idea of serving ads on a mobile phone.

Microsoft marketing executive Kostas Mallios described the Mobile 7 operating system to an audience that could be expected to approve of Windows Phone 7's taking a starring role in the mobile-advertising segment.

That would be attendees at the Cannes Lions International Advertising Festival that will soon be held in France.

It probably won't come as a surprise to anybody that the first level of ad-serving will be app-based. Overall, app-based ads can be either static or can be updated on-the-fly by advertisers attempting to build an ongoing conversation with potentially new customers who have chosen to download their apps, providing product and service news, offers, coupons, etc.

But the next two ad-serving themes on an entirely new level, although some wireless industry observers may argue that it may not be such a good idea.

One is based on Windows Phone 7's concept of "tiles", which are graphic elements that reside on the home screen as do icons and folder in iOS, or icons, folders, and widgets in Android. Windows 7's Tiles can be created from mobile apps that can be pinned onto a location of the user's choice on the home screen, and be updated dynamically with advertising content.

Microsoft's smartphone operating system will provide advertisers with three levels of ad-serving opportunities in addition to standard browser-based ads, and in a radical departure from the concept taken by either Apple's app-based iAds, scheduled to launch July 1st, or Google's browser-centric world, two of Windows Phone 7's ad-delivery systems will enable ads to be sent outside of either apps or the browser.

Some are now saying that Windows Phone 7 scheme appears to be exploring new frontiers in advertising intrusiveness, and that's not a very good thing... If Microsoft doesn't make it easy and transparent to opt out of 'toast', that word might well describe the fate of its upcoming "ad-serving machine."

Friend or foe? You be the judge...

"Windows 7's Tiles is actually a dynamic tile that you're now able to push information to as an advertiser, and stay in touch with your customer or audience. It's a dynamic relationship that's created. It provides for an ongoing dialogue with a consumer or wireless user," says Microsoft's Mallios.

Exactly how ads are actually pushed onto the home screen of your smartphone is a "dialogue", Mallios said, without providing detailed examples.

But what if the mobile app isn't running? You may think, Mallios explained, that you've "severed the relationship" with the customer.

"We have a third concept called 'toast'," Mallios said. "So now we have applications that are actually dynamic that you can download, that you can 'pin' in a new concept called 'tiles' — those tiles are another communications stream between you and your audience. And if neither of those are running — if the app is not loaded, if the pinning doesn't happen — we have another way to reach your customers called toast."

Windows 7's "Toast" allows mobile advertisers to push ads onto your Windows Phone 7 smartphone whether you have an associated app on it running or not. The advertiser sends your phone an ad, your phone receives and displays it, you view it and presumably you tap 'n' buy whatever the advertiser is promoting.

"Of course, any customer can opt out of all of this if he wishes to, or they can opt in — it depends on how creative we are in gathering their attention and wanting to keep them engaged as an advertiser," added Mallios.

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Source: Microsoft Corp.