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The latest Technology Review has an interesting article about social network business and how social networks still have a lot of challenges to monetize their communities. New models, but also new solutions, are needed. And a key issue is to get advertising work properly in the social media.

Technology Review summarizes the new technologies to get advertising work in social media: “Startups that help advertisers and marketers better target the users of social-networking sites are fashionable investments for venture capitalists in North America and Europe. Such startups hope to sell advertisers detailed information about individual social networkers. They include the brand-new 33Across (which we profile in our list of 10 notable startups, which begins on page 50) and the more established Finnish company Xtract, which counts Vodafone, T-Mobile, and Blyk among its customers and has begun selling its software to advertising agencies and online marketers and publishers. ”

Jason Pontin, Editor in Chief and Publisher of Technology Review, commented in the Millenium Prize event that our solution is the most complete solution he has seen for solving “the multi-billion dollar problem.” It is nice to see that we have really found a way to build solutions to monetize digital communities.

Yesterday we had the privilege to listen to Dr. Andrew J. Viterbi give an interesting presentation on the Science, Technology and Business of Digital Communications. He has been working in the middle of the mobile communications revolution and has left his mark in the field in many ways. Does the Viterbi algorithm sound familiar?

Dr. Viterbi is one of the Millennium Technology Prize Laureates for 2008. His lecture was a part of the Finalist Symposium that was held at the Helsinki University of Technology in Espoo, Finland. This year, the main Millennium Technology Prize, the largest technology prize in the world, was presented to Robert Langer from MIT for developing innovative biomaterials for controlled drug release.

The organizers of the symposium had also invited three promising Finnish companies to introduce themselves. All three companies combine science and technology with communication and are making solid business that aims “to someday repeat the success of Qualcomm”, as the organizers put it. One of these companies was Xtract and Jouko Ahvenainen gave the presentation that you can see below.

The presentation was about how to monetize digital communications and to deliver more relevant advertisements to end users at the same time guaranteeing more returns for the advertisers. In the audience was also Jason Pontin, Editor in Chief and Publisher of MIT Technology Review. He commented that our solution is the most complete solution he has seen for solving “the multi-billion dollar problem.” Afterwards we had some good conversations around the subject over some coffee and other refreshments.

Google has published their mobile and social network platform plans during the last week. Not so many surprises.

OpenSocial is quite natural next move from a company that wants to collect a lot of data. Social networking platform is a valuable source of behavior and social network data. And it is much more than have one or two social sites. The main concept with mobile has similar objectives. Who will dominate mobile usage and social data in the future. And finally who will prevail in digital media marketing.

But is it so simple that one company can prevail all relevant data in the future. Is it even possible that one company can collect all data when there will be more and more data all the time everywhere? I believe they can collect a lot of data. But on the other hand I believe that the services and data will be much more de-centralized in the future.

Intelligence comes nearer users and user devices. Smart analytics, customer profiling, and social intelligence come also to terminals (PC or mobile). The best solution to challenge Google is not to try to collect more data, but to have more intelligence to utilize the data. And this kind of analytics and advertising solutions help media and mobile companies to challenge Google.

2007 was the year of “social networks”. But wait a second: I joined a fringe “common interest-based” mailing-list in 1997, which became in 2000 a Yahoo!group. There are 950 members, the flow of e-mails is still enormous (give or take 1500 messages per month–without spam), discussions are sometimes fierce… and we are supposed to participate only in our free time. There was a seminal spin-off in 1999, when a e-mail-based RPG was created, which is still active. And discussions are fiercer, because each of us is supposed to be a country leader. Other spin-offs included local versions of the groups. No, we are not transferring it into any of the “hip” Social Network Sites (SNS). But the point is: already 10 years ago there were indeed vibrant communities. Now it is much easier to create them, adding content, and administrate them. What in a way puzzles me is that only in 2007 it became mainstream.

2007 was also the year of “mobile internet”. Someone was mentioning that “we’re finally going to make significant progress on mobile search (…) now we have .mobi domains”, but why use the word “mobile” in this context?
Internet is “mobile” by definition!
In the “good old days”, it was less mobile, because laptops were not widespread. Nor 3G phones. But it could be accessed anywhere at any time already in the 1990’s, provided one had a compliant device and infrastructure.
In short, the same way as today.
So “.mobi” sites will be easier to use in small screens. Great. But HTML and CSS has already features to adapt the webpage to a specific device since at least 2000. The significant progress is going to be done, not on the search by itself, but on the search combined with the user’s communication data records (from the operator perspective) and usage of the phone (from the network perspective). Guess who is doing it already, preparing the “next big thing“! Yes, we are. I might add that another benefit for the advertisers is combining that search with GPS positioning, for instance looking for a restaurant. The answer could be (literally) just around the corner!

2008 will be the year of “community marketing intelligence”.
So finally something new! It was about time!

An international mobile operator in Spain decided to launch a new kind of bet: by sending a 1,45 euro text message before a Formula 1 Grand Prix with the name of the local pilot (whose team they sponsor), one can win 1.000 free call minutes.

Well, they sponsor the guy, so they are paying two times, right? They´re actually building another point of contact with the brand. Yet one gets intrigued:

The driver in question is running for the Championship, so the probability that he wins the race is quite high–albeit sometimes
being humiliated by his newcomer team mate and the Ferrari guys (go Kimi!).

For the enthusiastic Spanish F1 (read Alonso) fans, it´s almost as good as straightforward “buy 1.000 minutes for 1,5 euros”. In any case, one can anticipate that those 1.000 minutes cost the operator less than 1 euro. Obviously. Mobile operators are not charity organisations.

The question is: why don´t others do the same? Since it costs them nothing, don´t they have anything to gain by putting up these “freebies”? Also, customers think “1,5 euro for 1.000 minutes on a 90% sure deal? Wow! Cheap!”

And since they think it´s “such a good deal”, they will spread the word through their social networks! And people like to join operators that offer freebies. It´s a known fact! How much they like to join?

Well, that´s for us at Xtract to find out!