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Safety in numbers

Ciena aiming to make service selection and delivery a smooth process for enterprise.

Was it one in the eye for Google when Nokia struck a global deal with Yahoo? Not quite, if only because the search giant refuses to stand still long enough to take a hit.

Two of Google’s greatest rivals, Nokia and Yahoo, joined forces in late May. Not, for once, was such a move designed to stem the web giant’s relentless encroachment into the mobile space; this time the motivation was to confront Google on its own turf.

There’s no denying the fact that an allegiance between the world’s biggest handset vendor and one of the internet’s heftiest web portals is a bid to play catch-up with the mighty Google on the search and mapping fronts. The idea is to offer a more compelling package to consumers, by allowing Nokia to broaden the reach of its mapping and navigation service, Ovi Maps, and increase its potential to attract advertising revenue through Yahoo’s local search capabilities.

Under the partnership, Nokia will be the exclusive provider of Yahoo’s maps and navigation services, integrating Ovi Maps across Yahoo properties, which will now be branded as “powered by Ovi.” Yahoo meanwhile, will become the exclusive provider of Nokia’s Ovi Mail and Ovi Chat services, which will be branded as “Ovi Mail / Ovi Chat powered by Yahoo!”

The two firms will also work on ID federation between their services, with the aim of making it easy for people to use their Ovi user IDs across select Yahoo properties. Co-branded service offerings are expected to become available from the second half of 2010, with global availability expected in 2011.

Nokia was forced to make Ovi Maps free in January in order to try and remain competitive with Google’s free mapping service on phones. But although Google has a well oiled machine to make money from users searching for local services on Google Maps, Ovi Maps is far more geared toward getting users from A to B than toward linking them to nearby services that have paid money to be discovered. The Yahoo Local service should help fill that gap.

According to Guillermo Escofet, principal analyst at Informa Telecoms & Media, Nokia has ambitions to offer Ovi Maps on all handsets, not just its own, so it needs to develop a monetisation model that relies on more than just pushing up handset sales via the mapping application. The alliance with Yahoo also enables Nokia to strengthen the capabilities of its Ovi Mail service, which will now be powered by Yahoo’s messaging platform. Although details of how the two partners will integrate services are scant, Escofet posits that Yahoo could bring capabilities such as unlimited storage and improved anti spam defences to Ovi Mail.

Yahoo will benefit by being able to enhance users’ experience of its local search service with Ovi Maps, which offers richer capabilities than Yahoo’s own mapping offering, especially in a mobile environment. The pair already have some common ground—Yahoo licenses its mapping data from Nokia-owned Navteq—from which Ovi Maps also gets its data. So Yahoo will effectively be getting the same data packaged in a more compelling way.

“The partnership makes sense. But it is going to be difficult to erode the lead that Google has already achieved as a first port of call for mapping and local searches both online and on mobile,” says Escofet.

On the subject of Google’s leadership, the search and advertising giant is seeking to increase the distance between itself and the following pack by further developing its ability to turn mobile activity into money. On the same day that Nokia and Yahoo announced their frontal assault on Google’s territory, US watchdog the Federal Trade Commission closed its investigation of Google’s proposed acquisition of mobile advertising network AdMob, concluding that the deal is unlikely to harm competition in the nascent mobile advertising market.

The decision came as a surprise to some, as it will give Google some serious oomph in the mobile advertising space. And, curiously, Google has another of its main detractors— Apple—to thank for the FTC’s verdict.

“Although the combination of the two leading mobile advertising networks raised serious antitrust issues, the agency’s concerns ultimately were overshadowed by recent developments in the market, most notably a move by Apple Computer Inc.— the maker of the iPhone—to launch its own, competing mobile ad network,” the FTC said in a statement. In addition, the watchdog noted that a number of other firms, “appear to be developing or acquiring smartphone platforms to better compete against Apple’s iPhone and Google’s Android, and these firms would have a strong incentive to facilitate competition among mobile advertising networks.

“As a result of Apple’s entry (into the market), AdMob’s success to date on the iPhone platform is unlikely to be an accurate predictor of AdMob’s competitive significance going forward, whether AdMob is owned by Google or not,” the Commission’s statement explaines.

But as a recent campaigner against Google’s proposed acquisition of AdMob, Simon Buckingham, CEO of Appitalism, believes the move will dramatically increase the cost of advertising for app developers, especially given the fact that Quattro has been acquired by Apple.

“The FTC’s decision to allow Google’s acquisition of AdMob allows the clear number one and two players in the mobile advertising market to merge. This means that advertisers really have no place to go to buy mobile advertising on non- Apple platforms other than Google as Quattro focuses more and more on iAds,” Buckingham said.

  • Nokia Corporation


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