Google Patent Watching: Signs Of MoLo Development

Summary

Examining patent filings has become something of a beat, in the blogospheric reporting of online media. ZDNet’s Russel Shaw takes a look at a fresh Google patent application for a new mobile local search app. The long term potential of mobile advertising could be huge given the size of the mobile user population. However, small businesses advertisers (constituting the lion’s share of local ad dollars) haven’t yet come around to mobile advertising in a meaningful way. This is at odds with the goal to build comprehensive local ad coverage in mobile search – towards the end of having a quality user experience.

Analysis

Mobile Local Search application development has picked up a lot in the past 12 months, but many challenges still stand in the way such as carrier control, smart phone adoption, lack of GPS ubiquity, and advertiser and user adoption. These factors affect each others’ progress and have all lingered in a 5-way chicken and egg scenario.

For these reasons, SMS is by far the most prevalent form of mobile local search as it doesn’t require a smart phone, it is a common standard across carriers, and it suits the proclivities of lots of mobile users (especially teens and twenty-somethings) who text message on a daily basis. Google and many others have already gotten on board SMS based local search and there are some interesting developments there, (including the verticalization trend examined in a past post).

There have also been interesting monetization strategies to be examined and modeled after including the U.K. partnership of Miva and 118 118 which text messages complimentary and same-category text ads along with SMS search results. Others in the local space that have told TKG they are developing similar mobile monetization strategies include NearbyNow.

Coming down the pike to join SMS is the increasingly popular wireless voice search (Free DA). Google’s and Microsoft’s entrance to this space will serve to push adoption forward by shedding mainstream light and awareness on the simple (but largely unrealized) fact that there are easy free alternatives to paying a few bucks for a carrier delivered 411 call. Convergence with voice and SMS (multimodal capability) led mostly by Tellme, will further push this utility and adoption forward.

But what about more robust and feature rich mobile search, akin to the map based interface in Google’s patent application today (see ZDNet column for patent art and screen mockups)? Though lots of users are coming around to more robust search platforms (data from Pew), given rising smartphone adoption, falling prices, and the beginnings of GPS ubiquity, one big gating factor to MoLo growth and realization of monetization potential, continues to be advertiser adoption.

But counter intuitively, greater advertiser adoption could improve the user experience with a more comprehensive corpus of local search content. The potential for monetization that greater advertiser adoption will bring, will also stimulate more innovation and product development in both applications and devices — and around and around we go. eMarketer data suggest that a large scale mobile advertising shift is imminent.

Carrier control still stands as an obstacle but there are some interesting strategies developing to sidestep this such as wi-fi enabled VoIP phones (dependent on widespread municipal wireless to be compelling at all), but that’s a whole different story.