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Mobile kingpins to marketing mavens: Bonking is brilliant, wanna try?

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Vodafone, O2 and EE sent their respective CEOs to Ronnie Scott's Jazz Club this morning, hoping to seduce the UK's advertising industry with the promise of SMS and banner deliveries across networks, with bonking to follow.

The event was part of Advertising Week Europe, and the operators were pushing their cross-network advertising platform "Weve". Eventually it will host pay-by-bonk vouchers and cards based on NFC, but it is already powering SMS campaigns targeted on the location and profile of the 15 million punters who've opted in to receive messages. The operators are hoping that it will become the default platform for mobile advertising in the UK, and, eventually, the world.

Weve was born out of the realisation that the credit card companies, Visa and Mastercard, were never going to share a cut of payments made using their cards, even if those cards were electronic versions stored in a mobile phone. Denied that most obvious source of NFC revenue, the operators decided there was money to be made running voucher schemes, or hosting them at least, although not if advertisers had to negotiate with each network operator separately. So three of them teamed up to create Weve.

Three, the UK's smallest operator, was not invited to the party. Weve points out that Three is welcome to join up any time, but as a "service user" (aka customer) as opposed to the controlling interest shared between the other operators.

Three isn't the only company concerned about the apparent cartel, Google also raised issues at EU level but was outmanoeuvered by Weve, which had received preemptive approval from Europe with the argument that advertising, on any platform, will remain hugely competitive.

EE's CEO Olaf Swantee was particularly adamant that he'd prefer to compete in the market rather than with lawyers, which is a little ironic considering the way T-Mobile (half of EE) filibustered UK WiMAX for years and still has a legal team fighting to avoid telling the public where its radio transmitters are.

Three aside, Weve lets an advertiser run a campaign which, for example, sends an SMS message to affluent young women walking past a supermarket, as one of the UK's largest supermarkets is already doing. Right now, SMS is the carrier of choice, so Weve is pushing the targeting - both demographic and geographic - to advertisers who can send messages or offers totaling 160 characters.

Next up will be video messaging and banner adverts on operator portals, followed by vouchers using NFC (short-range radio for bonking communications) and, eventually, NFC payment applications such as credit cards and Oyster-style ticketing.

The operators are walking slowly towards that ultimate goal, well aware that SimPay - 2004's attempt by operators to own mobile payments - lasted less then 18 months despite considerable investment.

But moving slowly carries its own risk: Google Wallet uses a secure element in the handset, as opposed to the operator-owned SIM, to host an NFC payment wallet, while Samsung has announced that Visa's payment application will come preinstalled on the (Samung-owned) secure element in the Galaxy S4, in some markets.

The operators won't want over-the-top players grabbing the high ground of pay-by-bonk, but Weve is now a company with its own agenda and, we understand, has had conversations with Samsung about putting Weve into the handset-secure element. That would upset the operator parents, and is unlikely to come to pass, but demonstrates how Weve sees itself as selling advertising space on mobile phones rather than providing a Trojan horse by which to slip pay-by-bonk into consumer pockets.

In that regard Weve cannot fail: space will be consolidated and sold, and money will be made selling it - even if NFC fails entirely. That means we'll never see Weve suffering the embarrassing death of SimPay, but if it doesn't leave network operators owning the element which secures pay-by-bonk transactions, then it won't have completely succeeded. ®

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