Apple has been getting a lot of press lately regarding its mobile advertising practices and policies. Today was no different with The Wall Street Journal’s Jennifer Valentino-DeVries reporting on Apple changing its privacy policy to collect location data:
As it rolls out a new iPhone operating system and an advertising platform, Apple is changing its privacy policy to allow collection and sharing of “precise location data,” including “real-time geographic location” of devices.
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Many analysts view location targeting as a possible boon for the mobile-advertising industry, allowing businesses to direct ads to people who are within a certain distance of a store or who frequent a particular area. It could open mobile advertising to smaller local businesses and make ads more valuable — important developments for Apple as it gets into the advertising game with iAd.
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But location is a category particularly fraught with pitfalls when it comes to privacy. More than data on Web-browsing habits or social networks, this location information is tied to a user physically. And increasingly, mobile devices have the ability to gather location data continuously, even if the user isn’t in an application that obviously uses it. With Apple’s new iPhone operating system, for example, applications can track location even after a user has left the program.
Apple is aware of the concerns. When it announced its new operating system and iAd, executives were quick to point out that the company takes privacy seriously and has added new privacy controls for users. (The folks at PCWorld have some good images of what iPhone users can expect to see with these controls.) To collect location data, an application must first get the user’s permission. Users in earlier iPhone operating systems could turn off location services completely on the location-services control panel, and now they can turn them off for certain applications as well. And when an application is collecting location information, a little arrow now appears telling users they’re being tracked.
It will be very important for Apple to stay vocal and open about this subject. Location-based services and advertising will be tremendous, especially for smaller, local establishments such as restaurants, as the charts in this link indicate. Because the iPhone plays such a key role in attracting users to try new services, the last thing the industry would want is for consumers to run the other way due to privacy concerns.
Crowded Mobile Networks
It’s really very fascinating to see the different ways people are using mobile to enhance everyday activities, and search seems to be a big component of that. For example, if you are out and about in an unfamiliar area, you can download apps to help you see what’s around or just use “old fashioned” search engines via mobile web.
The same applies for retail. Julia Tang of the Google Retail Team recently posted a snippet of video from Google’s “Future of Multi-Channel” panel in which Alex Barza, Google’s Mobile Ad Sales Lead, and Surojit Chatterjee, Google’s Product Manager, discussed examples of why mobile is the next ‘big bet.’
The segment is rather short, but they do get in some key points, including “54% of users who researched online but bought offline used their mobile device to conduct their search.” They also cited growth of augmented reality as a part of searches. Also, they stated that 20% of consumers are using smartphones, which plays a key role in such dynamic search adoption.
With such promising and interesting growth in terms of ways smartphones are used beyond calls and texting, I’m led to my next point: actual usage. For every mobile advance that gets adopted, the “OMG TOO MANY USERS” seems to come up. For instance, USA Today reported that new subscribers to AT&T that have smartphones will not be able to get unlimited data packages.
Newcomers will have two options: Under the DataPlus plan, subscribers can pay $15 a month for 200 megabytes of data; that would handle about 400 photos or 100 minutes of streaming video. The DataPro plan offers 10 times that capacity, 2 gigabytes, for $25.
Here’s the part I found most interesting:
AT&T says 65% of its smartphone customers use less than 200 MB a month, and 98% use less than 2 GB.
But, largely due to the success of the iPhone, AT&T “has the most loaded and most used data network in the U.S.,” says Roger Entner, head of telecom research at Nielsen.
And just 3% of AT&T’s smartphone customers account for as much as 40% of its data traffic, contributing to slow transmissions and dropped calls. AT&T must control heavy users, or at least get them to pay more, Entner says.
In a February GigaOm article, streaming video is cited as the biggest bandwidth hog, causing carriers to drive up these price plans. So I wonder then, why not address that problem directly? There seems to be quite a few solutions the carriers can take advantage of right away:
If the pipes are too small and what’s going through them too big — which is the case on many mobile data networks (hey AT&T, how’s that iPhone traffic treating you?) — then wouldn’t it make sense to add some compression algorithms to the mix?
It makes sense certainly, and something operators — not to mention mobile phone users — have experimented with. On the vendor side, players like OpenWave and Bytemobile offer network-based solutions that operators can deploy to “optimize” mobile data delivery via a variety of techniques. Meanwhile, a handful of mobile Web browsers, such as Skyfire, have tried to drive compression right down to the handset, utilizing proxy servers and compression algorithms on the back-end and specialty browser clients on the phone.
So, will other carriers follow AT&T? Or will they look for other answers that aren’t going to hurt consumers and stifle mobile growth in areas like retail? Hopefully they will before getting in over their heads much like AT&T did with the iPhone.
But of course, like everything else, we’ll have to see how this all plays out.
Typically I write about industry issues and company news pertaining to Moblico, but today is the start of something that is a little different and holds a lot of personal importance to me. A short while ago we placed a billboard on our headquarters that officially launched our “Mobile Responsibly” initiative:
Our intent is to heighten awareness around some of the issues that accompany mobile technology adoption. Moblico is constantly announcing new and exciting mobile solutions, but we wholeheartedly believe that it is our duty to promote proper and intelligent usage along with it. Afterall, success and safety/respect go hand in hand.
Or as we put it, “With empowering technology comes great responsibility.”
In the months to come we will be announcing efforts that support all of the areas we feel are a part of responsible mobile use. But for now, “Don’t text and drive!”
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