More powerful phones and greater bandwidth are creating a whole host of opportunities for marketers to develop more immersive brand environments - particularly for the highly coveted, but fickle, youth market - and the bar has been raised on the type of advertising that can be carried.
Third-generation dominance may be a way off, with observers talking down the likelihood of a 3G Christmas, but there are plenty of new bells and whistles to play with. Once again, content is king, but what do mobile users want? Given the rapid uptake of mobile devices by younger people, it's no surprise that entertainment is high on the agenda. According to Pamir Gelenbe, director of corporate development at mobile agency Flytxt, it's a market that's already worth £700 million a year.
"For the past four years it has been a black-and-white world that ended at 160 characters," points out Gelenbe. "Now, with 40 per cent market penetration of colour multi-media handsets, it is like reaching an oasis after the desert. And mark-eters are very visual, so it's exciting."
Content owners, in particular, are seeing an opportunity to enter a potentially lucrative arena. EMI joined up with third-generation operator 3 for the release of Robbie Williams' latest video, Misunderstood, before it previewed in any other media. Customers could download or stream the video to their handsets as part of the deal. Danny Van Emden, digital media director at EMI, says the firm is keen to explore all channels.
It also teamed up with Carphone Warehouse to release Williams' Greatest Hits as a memory card album. "Mobile's ubiquity makes this an opportunity," she says. "It is important for content owners to get official material out there. The mobile market has been slightly tarnished by low-quality products, and artists want to see official material they can control."
Entertainment is also a key weapon to counteract churn among operators.
With handset ownership at saturation level, competition in the consumer market shows no sign of abating and loyalty remains low, particularly for the more fickle youth segment.
As music is an important social signifier to this group, it's a great hook for marketing to them. EMI has been working with Samsung to create a point of difference by offering music news and assets to users. "For it to work, you need exclusivity and editorial heart," says Van Emden. "People want to stay in touch, they want to buy things and they want to be first. And you can do that with mobile."
Eric Winbolt, digital media manager at EMI, points out that, because music comes in bite-sized chunks, as tracks or videos, it is particularly suited to the technology and mood of mobile users. "Everybody is looking for entertainment content to drive the market and music is best suited due to the restrictions of connectivity. People don't understand the technology but, through music, they can see how powerful it is," he adds.
EMI aims to assert its stamp of quality on content, continues Winbolt.
An EMI ringtone, for example, should be better quality than a non-official one, as well as being more lucrative. "One of the things about the Robbie deal is that it asserts the value of our content. It is important that people realise it has value."
Other artists such as Starsailor are also extending to mobile internet.
For the band's recent appearance at Glastonbury, the band's mobile web site (www.starsailor.net/mobile) allowed fans to upload their pictures and messages.
Yet, for content providers, it is still a confusing area, admits Winbolt.
"It changes so quickly and there are so many options that it is difficult to know what to back. You can't do everything. We have made sure our mobile strategy fits into our broader strategy and that we are consistent across all platforms."
Consequently, EMI is adopting a cautious approach and the Robbie Williams activity is an experiment. "Right now, the focus is on marketing messages and audio products, but we are also creating a lot of premium content for mobile, like behind-the-scenes documentaries, as well as live and acoustic sets," says Van Emden. "When we're confident with 3G, it'll be ready to go."
Although richer content has been around for the past 12-to-18 months, marketers are still fighting shy, says Gelenbe. Partly due to an understandable 'wait and see' attitude in the face of a rapidly changing sector, but cost is also a factor. One brand that has taken the plunge is Volvo. Last year it backed the pan-European launch of its new S40 model with a 3G push through Mobile 365 and Mindshare. In keeping with the inscrutable nature of its 'Mystery of Dalaro' campaign, teaser posters invited users to text 'mystery' to a shortcode. Device recognition determined the user's type of handset and replied in kind. Users of 3G phones were sent a text inviting them to download the appropriate viewer to see a clip of the ad. Others were asked to send their email address to receive a link.
According to Federico Bolza, consultant in the telecoms, entertainment and media division of Cap Gemini, the Volvo campaign shows the viral power of mobile video. However, he adds that not all campaigns would be as clever.
"Mobile marketers should be realistic about what works at the moment. User experience still lags in terms of look and feel. The benchmark is now broadband internet. People have great expectations and their sophistication has gone up hugely."
The mobile content market is still in the first phase, says Bolza, and personalisation is the key driver, so ringtones, skins and wallpapers are in. "In the next phase, users will affiliate themselves with brands related to compelling content and, ultimately, that will lead to interactive services." In line with some observers, he reckons 3G will not kick in for at least a year.
Others are more optimistic and Gelenbe believes the release of 3's pre-pay package may mean that it won't be long before third-generation demand reaches critical mass. Meanwhile, he predicts an explosion in branded WAP sites. "It was all but dead four years ago, but figures show page impressions are doubling every six months. You will be expected to have a presence."
Desirable content will be that which appeals to a younger demographic looking for material to share - the quirkier, the better. Flytxt helped to add a mobile element to Pot Noodle's current web campaign with glue London. Respondents are ask-ed to submit pictures of themselves 'noodling' in odd places, in a spoof of 'dogging', while another Flytxt push, for Cornetto Love Potion special editions, shows how value can be added to standard text-and-win through a multimedia message.
Personalisation was at the heart of a recent deal between Buongiorno and TV company FremantleMedia to provide mobile content for 'tween' brand Mysti. Fans of the UK can download specially developed ringtones and sounds from the dedicated Mysti site (www.mysti.co.uk), together with logos and pictures with which to personalise their mobile phones.
Matt Cotton, director at content aggregator Mobile 365, says this kind of content is a CRM manager's dream as it allows them to reward users for providing information and keeps them coming back. "You only have to look at how Coke is focusing on film and music to drive sales. It is looking at ways to push content to consumers to learn more about them."
Mobile 365 was behind a mobile promotion for Fox's launch of Alien vs Predator in October. The firm created exclusive wallpaper and Alien tones, and users could vote on who would win the battle of the monsters. Those with colour handsets received free wallpaper and could buy other content.
"It's giving something back to consumers in a way you don't get from Big Brother, for example. It engages people and keeps them interested," says Cotton. But the options don't end there. Cotton points to celebrity voices as the next fad to help engage users. Nike used four Olympians for a 'Get Fit For Summer' campaign this year. Visitors to a web page nominated someone to take the challenge and an athlete's message was sent to their voicebox.
Ray Anderson, chief executive officer of Bango.net, which enables and supplies mobile content, feels 3G is bringing credibility to the sector as big brands put a stamp of quality on content. Bango is working with Carphone Warehouse to help it build its Play Mobile brand. "We're moving towards more transparent pricing and people knowing who they are dealing with."
However, Jonathan Smyth, head of digital music marketing at Buongiorno, says the explosion of legal music-download sites has opened up scope for non-music brands to maximise the medium's marketing power. "Mobile phones provide another channel to market, enabling consumers to receive and buy tracks on their handsets," he says. "The advent of digital music has widened the marketing possibilities more than most of us could probably have imagined a few years ago. Everyone has the opportunity to get involved in the growth of digital music."
Slam TV, which only formed last year to supply audio and video content to mobiles, already has access to 300,000 audio tracks and 220,000 videos.
Managing director Gavin Wiseman says partners are realising the value of this content. "We supply ringtones and wallpapers but, increasingly, we will be moving people to full multimedia. We're already live to allow access to 2.5G audio and video and user experience will just get better."
Since September, Slam TV has provided content for download service Wippit's wireless offering, whose chief executive, Paul Myers, says is an obvious progression from ringtones. "Downloading direct to your mobile is the logical next step of the path we've been treading since launch. We've been waiting for the handset and network capability to catch up. Now it has."
Wiseman expects many others to follow next year, especially retail brands.
"In certain cases, brands will need a mobile platform as that's their audience's comfortable environment."
Observers may dispute the timescale, but they do agree that change will radically alter what mobile can offer. For Shazam, this means moving the brand closer to being the music gateway it has always aspired to. Marketing director Tim Porter says: "We offer a ringtone for an artist, but in the next six-to-18 months we may be able to let you download the track, see the video or get a discount on the album. That's where we want to be."
LEVI'S CREATES SONG COMPOSER
Ever since Nick Kamen stripped to I heard it through the grapevine, Levi's has been synonymous with music, but now it's asking mobile users to supply the soundtrack.
Its pan-European push with Lateral lets users download a special mobile audio mixer (MAX) Java application, with which they can compose tunes and remix others that have been uploaded to the European site (www.eu.levi.com). The tunes can then be used as ringtones.
Helene Venge, Levi's head of digital marketing for Europe, says: "This will appeal to the opinion formers and early adopters we want to reach.
We view mobile as a 'pull' medium that lends itself to narrow segments."
Simon Crab, creative director of Lateral, says the strategy is "edgy" in keeping with the brand's values.
"A lot of brands try to own music by pouring money into it. But, if you let people make their own music, it is much more powerful than trying to buy your way in, and more cost-effective."
He reckons nothing has matched the sophistication of MAX. Users create tracks from scratch, which can be shared, giving a community aspect. Levi's plans more applications next year.