Wednesday, April 30, 2008


I have been saying that cell phones are the ultimate form of SNS because the phonebooks being real social graphs. If that's the case, all the development we see in the PC based web are going to apply to the cell phone space in the near future, especially new types of ad technologies such as social ads. What's more, cell phone being a bridge between virtual and real worlds, possibility of the cell phone web can go well beyond the PC web. That' why I have been keeping an eye on new developments in the cell phone SNS space.
One of the fascinating success stories in the space is Moba-ge-town run by DeNA, a net auction company in Japan. The site started as a free game site. Isao Moriyasu who is in charge of the site, told me that he had known Moba-ge-town would be successful. He knew users would flock to the site, because at that time most game sites in the cell phone space charged a fee to play a game. "But I didn't expect we would be this popular at such an early stage," said Moriyasu.
Moriyasu made a couple of fantastic moves. The first is that he made a site a SNS. Atracting young users with free games, Moba-ge-town then let users form communities. After establishing one of the largest SNS in the cell phone space, Moriyasu is transforming the site into a portal. "Rival is Yahoo!" says Moriyasu.
Another fascinating move he made was having both contents and a monetization process ready from the beginning. DeNA, being an auction and affiliate service provider, had a cell phone affiliate service called "Pocket Affiliate" ready and going when Moba-ge-town opened in 2006. Therefore form the first year of operation, Moba-ge-town was in black. Many contents providers I know tend to think "You build it, then money Will come." But usually it won't.
The third fascinating move is TV ads. Some Internet moguls criticised Moba-ge-town when it started running TV and magazine ads, saying the mobile users and TV viewers are demographically different. All the Internet businesses that run TV ads in the past lost their ad money, they said. However Moriyasu said advertisement pays off in terms of gaining new users. Also one online ad executive hails it is a marvelous move. "More and more national ad clients know that legacy media cannot reach teenagers. Even the Internet portals cannot reach them. They know teenagers' main medium is the cell phone. But they know nothing about cell phone web, except Moba-ge-town. National clients know the name because of Moba-ge-town's TV ads. Moba-ge-town is getting almost all the ad money that national clients have for the cell phone space" he said.
DeNA' financial statement of 2007 Q3 confirmed the ad executive's contention. "Advertisement by national clients growing continuously," the statement says.

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