'India's mobile advertising to ring in $8-13 billion in 3 years'

'India's mobile advertising to ring in $8-13 billion in 3 years'

Tom Henriksson, global head of Nokia interactive advertising, Nokia Services and Software, says the company is expecting the services business to grow significantly out of India. In an interaction with fe's Rachana Khanzode, he speaks about the Indian market, the challenges in this market and its association with Airtel.

How important is the services business for Nokia at the moment?

Nokia has largely been a device solutions provider to the consumers but it services solutions business is equally important for the company. The consumer service's is already a significant business for us and is into billions. Interactive advertising is one way to leverage these services and the expectations are big. The device business has been dominant for a long time and now we want to monetise the services business too.

How big is the Indian market for the interactive advertising business of Nokia?

In October 2007, we bought N-pockets in US and simultaneously incorporated relation with Bharti Airtel in India. That is how we brought the two skills of delivering content, selling advertisements to advertisers and consumers in India. We are doing big investments into India and we are early entrants into this space, therefore we feel we are at the edge. We have launched similar interactive advertising services in US and five major countries in Europe. The advertising market in India is just Rs 22,000 crore and mobile and digital advertising is currently fraction of this market, therefore we believe that we have a huge scope in this market. As of now the real revenues are small but they are performing revenues.

What are the challenges that you are experiencing at the moment?

Mobile advertising is in its nascent stage in India and therefore there is larger demand to educate agencies and advertisers. There are challenges in making consumers use these services. Data services are also not huge in India. So initially consumers may demand for free services and this will bring attention towards information. The third generation (3G) spectrum has been further delayed. We therefore feel once it comes to place the data usage will go up drastically and then we have big expectations from this business.

What kind of engagement do you have with Airtel at the moment? How are you leveraging it?

Typically in this industry, the revenues between the selling and service provider of advertisements (Nokia) and the publisher of these advertisement (Airtel) are split in a way that a publisher ends up getting 50-70%, depending on its size. Currently, through our relationship with Airtel, we bring display of advertisements on the web through Nokia and Airtel services and through mobile applications like maps, games and sponsorships. We have currently tied up with brands like Sony Ericsson, Samsung, PandG, Ford, and Lufthansa amongst others.