The growing mobile advertising market in Europe could face one of its stiffest challenges to date after the Hutchison Whampoa-owned telecommunications company Three begins a trial to block mobile advertising on its network.
The company has announced that it is trialling the initiative in Italy with a view to rolling it out in other markets. The Israeli company Shine Technologies, which is working with Three, has developed technology that will prevent ads from being served to mobile users by blocking them across cellular networks. If successful, Three could roll-out of the technology to all other Three Group operators in Europe, which also includes Austria, Denmark, Ireland and Sweden.
According to Three, it says it does not want to eliminate mobile advertising altogether. Instead it said it wanted to “give customers more control, choice and greater transparency over what they receive.”
“Irrelevant and excessive mobile ads annoy customers and affect their overall network experience. We don’t believe customers should have to pay for data usage driven by mobile ads. The industry has to work together to give customers mobile ads they want and benefit from,” according to Tom Malleschitz, Three UK’s chief marketing officer.
It remains to be seen whether Three intends to serve its own advertising to its mobile customers, a move which has been mooted by other telco operators. Some telecommunications companies are understood to be interested in exploring other advertising related opportunities on their networks, including possible revenue sharing arrangements with companies like Google in return for effectively carrying their advertising traffic.
The mobile industry also views a number of social apps like WhatsApp and Facebook messenger as a threat to their business models as they have eroded income from their traditional SMS and voice offerings. In addition, OTT players like Google and Facebook benefit from considerable mobile advertising revenues, yet do not invest in or contribute to the mobile networks that distribute their products and services.