Heavyweights Invest in Mobile Ad Company

Telefonica and Vodafone are reportedly both investing in a US-based mobile advertising company in a bid to fend off the threats from online companies such as Google and Yahoo muscling into the mobile market. The two mobile powerhouses said they had taken minority stakes in mobile ad solutions company Amobee. The San Francisco-based technology company has already been working with Vodafone in Greece, the Czech Republic and Spain.

Amobee, was founded in May 2005, and provides an advertising platform for the mobile Internet, as well as games, video and messaging services. Both operators are keen to add extra revenues streams as they face up to rising competition in developed markets. Vodafone described the rise of mobile advertising as a "tremendous opportunity" for brands to target customers directly.

Last month Telefonica reported on the success of a new mobile search and advertising platform which it had commissioned from JumpTap. According to the Madrid-based giant the new application developer fully implemented a platform that delivers contextual banner ads on the operator's Movistar Emocion portal. The service works in much the same way as Google does with online and mobile searches.

Telefonica reported that in the first two months of operations it managed to sell the full inventory of mobile ads available via the JumpTap solution. According to the platform developer this is a rarity in mobile advertising circles, however, neither company gave any indication of how much they were charging for the advertising space and whether it could be considered to accurately reflect market conditions.