Media Dojo

Mobile app stores are in the midst of an algae bloom. Gartner is throwing out (throwing up?) numbers suggesting 4.5 billion downloads in 2010, $6.2 billion in global revenue, and 82% of all apps being free to the consumer. A multi-billion $ paid market off 18% of the available inventory would get most anyone hot under the collar.

That said, the new opportunities have created nearly as many headaches. Remember the giant pain in the ass just to format mobile content for multiple devices? Well, you can blow that figure up by several orders of magnitude once you kick in all the new engagement models with various calls-to-action. Then, think about the various app store policies for uploading, approval and distribution. Make no mistake. This is a much better world than the days when deck placement made or broke companies. At the same time, we’re playing for real money now.

We spoke with Goldspot Media, one of the newer players out there trying to bring some order to the app store chaos on behalf of creatives in publishing and marketing shops. Goldspot offers a web-based drag and drop studio called miApp that enables that fabled write once/distribute everywhere on any device for any app store. For the one-pager on Goldspot’s corporate vital stats, check out the MD Tear Sheet_Goldspot Media.

I caught up with Srini Dharmaji, Goldspot’s founder and CEO, just before taking off for Europe to talk about how this model plays out in the realm of mobile video advertising.

Media Dojo: What’s the end-game for Goldspot Media?

Srini Dharmaji: What we are trying to take to market is a video ad network for mobile applications, focusing strictly on mobile apps across the board for smartphone platforms. Our main objective is to enable mobile applications to do more than just work on display oriented mobile content pages. We are launching an ad network that is focused on delivering in-app mobile video advertisements.

MD: How does this work in practice?

SD: The idea is that so far video adverts were being rendered only as video content. The ad is spliced into the content stream in whatever sequence the publisher and marketer agree. This is part of the paradigm of manipulating pages of content but it does very little to add to the experience of a mobile video application. We’ve come up with some mobile app native formats, such as that the video ad will play while the application is starting up. So while the page is loading the video ad is overlaid on top. The app publisher might also split some of the screen real estate in which part of it is used to render the ad while the video application is displaying the content or asking the user to take some kind of action. The key thing here is how well and fast you render the mobile video ad.

MD: Staying on the business side before we dive under the hood, how are you taking this to market?

SD: Publishers, brands and agency creatives join the video advertising network and part of that includes access to the drag and drop design studio called miApp. We give them a set of APIs that unlocks the interactive assets they want to add to their original video content. The content originators then use the studio to add pre/post/mid rolls, in-stream ads, shrink & surround ads, overlays, animated Gifs, ad bugs and so forth to their source content. The two points to remember is that A.) control over everything from concept to deployment can stay with the creative person and B.) once they’ve decided on what they want, they can one-click deploy to any smartphone device across all app stores.

MD: Fair enough, now let’s talk performance. How do you make your video ads work better than what’s on offer from the usual suspects like an Admob or Millenial Media?

SD: The difference is that the big ad networks stream the video ads from the network. We place the ads on the device using what we call opportunistic downloads. So when the device is connected to Wi-Fi for example, we download all the campaigns that are running for the month. So that ads are sitting on the device ready to go. If you look at the latency improvement by using this method and our APIs, by the time an Admob video ad is rendered by Tap Tap or some other mobile video game, you need to wait between 10-15 sec depending on the bandwidth. In the time it takes for Admob to pull the stream from the cloud, Goldspot will have already played the ad.

If you look at it from a marketing standpoint, the big networks are taking a high quality video ad from a brand and re-encoding it to play for different bit rates depending on whether the device is tuned for an EDGE, 3G or Wi-Fi network. I’m not sure if I’m a brand and I’ve just spent many tens of thousands on creating that high quality video ad that I want a technology limitation to butcher the quality of my ad. That is something we believe is a big negative as far as rendering ads as it’s done today.

MD: For the moment, let’s take the secular growth of mobile media and advertising as given, where will the new markets and new devices arise?

SD: Rather than talk about specific devices, let’s look at the more broad use case in which you have networked devices which aren’t mobile phones. If you think about something like iPod Touch, which has sold many more units than iPhone, it’s not always in contact with a Wi-Fi network. Chances are the demographic playing the game might be a good candidate for an advertiser but s/he’s not connected to the network. What do you do? Because we’re able to render and download adverts to pre-cache them on the device while connected to Wi-Fi, we can then show the adverts when the user is offline. There are already some standards brewing for offline decoding on the advertising content for networked devices that deal with sporadic connectivity. We think that’s a major growth area.

MD: Certainly a lot of moving parts. Last question then. How do you define success?

SD: All the publishers care about is show me the money. All the brands care about is show me the engagement. You’re dealing with two different animals here. The way I define success is make the whole ecosystem happy and sustainable.

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