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Nokia Enters Madhouse

(23 Oct 2008, BWCS Staff)

Finnish handset maker Nokia is to invest in Chinese mobile advertising company Madhouse, in a bid to secure future ad revenues in the Chinese market. The investment wing of Nokia, Nokia Growth Partners, has poured an undisclosed amount of money into the Shanghai-based outfit which operates a network for advertising on wireless application protocol sites. According to Madhouse, the network, known simply as MadNetwork, covers three quarters of China's total mobile internet traffic. The company claims to have over 1,100 major sites on its roster.

Nokia, which recently announced weaker than expected third quarter profits due largely to slow sales in Europe, believes that demand is increasing for sophisticated services in emerging markets such as China and India. Paul Asel, managing partner of Nokia's fund in China, said in a statement "It costs one-fifth the amount to develop a company here. It allows for more efficient innovation."

Earlier this month Google, which is also making a big play for mobile advertising revenues, announced that it had lined up China Mobile to be the first Asian operator to sell phones complete with Google's Android software. According to various press reports the Chinese mobile giant, which boasts some 410 million customers, will sign a deal giving it the rights to distribute an Android phone. China Mobile had earlier tried to sign a deal with HTC to get an Android device on the market before the end of this year. The Chinese company, along with NTT DoCoMo and Japanese telco KDDI, is a member of the Open Handset Alliance, which has made a big push for Android.

In June of this year advertising backed mobile operator Blyk, announced it is set to enter the German, Spanish and Belgian markets in 2009. The company's service is based on advertising revenues and will allow users to make calls and send texts for free in return for having mobile advertisements delivered directly to their phones. The Finnish-British operator which already offers services in the UK says it will continue to target 16 to 24 year olds in the new markets. In April 2007 Blyk, announced that it had signed a deal with Nokia Siemens Networks to supply, build and host its core mobile network.

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