This is the feedback we got at the Microsoft Connected Services Sandbox, where Artilium also showcased several converged applications. Put simply, the Connected Services Sandbox is a development environment that facilitates the rapid creation and deployment of new services that effectively join the cool apps we associate with Web 2.0 with everything else. The program walks the talk, encouraging mashups by bringing together independent software vendors, developers, systems integrators network equipment providers and telecommunications service providers to create and test new communications services.

It’s all about combining the best of the Web with the best of telecoms – and not reinventing the wheel in the process. As Steve Zimba, Managing Director of the Global Telecom Business at Microsoft, put it in a statement: “We see third-party application development powering a new wave of innovation, which in turn provides operators with a plethora of new revenue-generating services.”

This wave has impact. A prime example is the line-up of demos Artilium unveiled at the Sandbox, all featuring our patented Mobile Presence functionality. They included:

• A child monitoring service that allows parents to check the location of their children and their status (if they are on phone, in a lesson, etc…); and make a one-click phone call from the computer desktop to their child within a particular location (school, home, a friend’s house).

• Real-time call control from the desktop allowing users to see an incoming call – regardless of whether it arrives on the mobile, landline or IP phone – via a pop-up display on the computer screen complete with contact details including a photo designated in Microsoft Office Outlook contacts. True to the name this app provides users with options to “control” the call. They can send it to voicemail, forward the call to another number, or choose from a number of other actions.

• A desktop-integrated location-based weather service that delivers dynamic 12-hour weather forecasts in synch with the user’s current location to the device of their choice.

By way of background, the applications showcased in the Microsoft booth were all built using Artilium’s ARTA Mobile Services Platform, an open and modular Next Generation Service Delivery Platform and Intelligent Network designed to enable the rapid creation of new mobile applications. It achieves this by providing open and secure mobile network access to third-party developers, thus creating intelligent mash-ups that combine network capabilities of presence, mobility, location and telephony with Web services including advertising, social networking and search. Artilium’s patented Tri-cell Intelligent Location System rounds out the offer, providing automatic continuous location data for mass market phones without the need for GPS or other specialist equipment.

The idea is not to make a new desktop experience, but to extend it and make it fully mobile (yet device agnostic). The outcome is continuous real-time location and state data that open an infinite variety of possibilities for a new breed of mobile mashups that combine what Artilium calls the Three C’s – Content, Commerce and Community. These are more than service components; they are the must-have ingredients of innovative mashups that were a main attraction at NXTcomm08. The opportunity is at the intersection of these three C’s. That’s where make or buy becomes irrelevant because only mashups can we join the best of the Web with traditional telecoms services, and pave the way for mobile operators to deliver a new generation of services that securely exploit the convergence of location, presence and everything else in between.

Indeed, a recent report by Juniper Research is convinced this ecosystem will deliver benefits. It predicts mobile advertising spending will reach $1 billion this year and rise to $8 billion by 2013. The growth levels we know from Internet advertising have arrived full-force in mobile.

While mobile advertising is viewed as new, the checklist to deliver brand messages to the consumer is a repeat of the checklist we know from other forms of advertising such as TV and press. Put simply, the end-game is about delivering a genuinely useful message. If the advertisement that accompanies the content or service is relevant, the customer listens… If the advertising is off the mark, it’s bothersome noise or, worse, dismissed as spam.

The more relevant the ad, the higher its value. And there is another key benefit to consumers: Advertising subsidizes the cost of the content or service. At the other end of the equation, the ad agency generates revenue for each advert impression or click (in the Internet and on mobile) , and the media provider (mobile operator, broadcast network, Internet Service Provider etc…) makes its money in the middle, supplying both the service and the ads.

But mobile has a huge ace playing in its favor: It is location-aware. This capability, whether supplied by GPS or any number of other technologies, enables companies to target ads to location. This paves the way for ads to be well targeted, and delivered to the right person at the right time and place.

This form of context-aware advertising is powerful and the use cases are compelling. Take the example of a restaurant that has some empty tables in the early evening. It might be a good idea to advertise to people whose profile indicates they would appreciate the restaurant cuisine. It’s an even better offer if the restaurant could deliver their message to people nearby and likely to pop in on-the-fly. In addition, the mobile advertisement could include a call-to-action, such as the opportunity to reserve a table via a WAP site, respond to receive a discount, or pass the offer around to friends who might join the meal. As I said, context-aware advertising is about getting the right advert to the right person at the right place and at the right time. It’s quite literally an offer consumers can’t easily refuse.

Are we there yet? I would suggest that many of the factors are already in place to make context-aware advertising on mobile devices a success.

First, consumers are already familiar with personalized advertising based on data gathered about their habits and preferences.  Retail loyalty cards, such as Sainsbury’s Nectar and Tesco’s Club Card, are classic examples. It’s a mindset that translates easily to mobile.

Second, the consumption of media content on mobile devices (music, video clips, games, ringtones, mobile TV, etc...) is on the rise. In fact, Juniper Research estimates that mobile advertising linked to mobile TV content and consumption will soar by 2010. We happily accept advertising on TV in our living rooms. Surely we won’t mind it on mobile.

Finally, some mobile operators and companies are already building successful businesses on the premise that consumers will accept advertising in return for free mobile services such as mobile email and calls/texts. Blyk - the MVNO on the network belonging to Orange UK - and Virgin Mobile USA are two recent examples.

With all the pieces falling into place we can ask ourselves two questions:
1) Is the consumer ready for context-aware mobile advertising?
2) Is there technology ready to deliver advertising seamlessly integrated with content and services?

We believe the answers are:
1) Yes
2) No, but it is getting closer.

It took some time, but operators are beginning to understand that insisting on strict control over what happens on their networks comes at a heavy cost and may lead, in some instances, to outcomes quite contrary to their interests.

Take Vodafone, for example. Its decision last week to offer unlimited Internet access as a standard feature of its new monthly mobile price plans is more than just a new flat rate policy. It’s a clear recognition that users require - and will continue to demand - access to their pick of services, apps and social networking sites. In fact, we have it direct from Vodafone that the top three Internet sites on Vodafone Mobile Internet are Facebook, Google, and the BBC. The top three searches by customers are Facebook, Bebo and eBay.

A new flat rate policy fuels the use of Internet on mobile phones, an additional revenue stream that Vodafone needs to grow in a saturated market. Gone are the fears that Vodafone may be relegated to a mere pipe. In its coordinate-and-cultivate role, Vodafone understands it can’t lock customers into a version of the Web it controls; its role - and the source of its competitive advantage - revolves around providing its customers no-brainer access to the Internet and the off-portal destinations they want most.  In short, being open.

(To be fair, the “unlimited” offer has a catch: a 500 megabyte cap on usage. Still, it’s a shift in operator thinking that will give the mobile Web the shot in the arm it sorely needs. As Paolo Pescatore, Director of Operator Strategy at CCS Insight, a telecoms consultancy, said in this article: “It will be interesting to see how this is marketed as this means it is not a truly unlimited service. But it is a step in the right direction in terms of the integration of data into existing tariffs and a greater level of simplicity.")

But it’s not only about providing access to the open Web; network operators must also overcome their reluctance to open up their networks to third-party application developers and service providers. KPN is one operator that understands this all too well. It recently opened its mobile network to create an ecosystem of user-generated applications.  The software enabling this transformation is Artilium’s ARTA Mobile Services Platform, designed to facilitate rapid creation of new mobile applications, packaged as services.

Fortunately for us all, other mobile operators around the globe are adopting a similar mindset.
An encouraging - and little-reported - example comes from delegates representing a range of tier 1 European network operators at the recent IMS 2.0 World Forum event organized by Informa. This summary post makes it clear: Mobile operators are “no longer wondering whether they should expose network resources to third parties, but rather what the best way of doing it is.”

An operator that stood out is Spain’s Telefonica. The address delivered by Luis Angel Galindo, senior manager for mobile services strategy and innovation, spoke volumes about the operator’s commitment to providing APIs that expose some fundamental network resources to third parties.

“What has become clear is that in Web 2.0, the user is central to the development of content and services,” he said. “This is the age of personalization. People want to design their own services, and there are a large number of players out there who are developing the tools to enable them to do it. We must invite clients to participate in the service design process.” To this end, Telefonica has set up a portal called OpenMovil Forum, from which developers can download a range of APIs.

Speaking at the same conference, Mario Bonnet, Telecom Italia’s innovation project manager, told delegates that the operator had also been working on a series of APIs, effectively enabling third-party service development based on network resources. Bonnet was quoted as saying that, within another six months, the operator expected “to have at least seven or eight APIs available to third-party developers.”

Why the growing interest among mobile operators in tearing down the walls and throwing open the networks and network resources to other companies and stakeholders in their business ecosystem?  Because change here - like everywhere - is inevitable.  Operators can either take charge of change - or be crushed by it.  Bonnet put it best: “The challenge with Web 2.0 is to turn threat into opportunity.”

From Hi!, an offer aimed at Holland’s youth and “young, trendy, cool people,” to ethnic focused MVNO Ay Yildiz (a brand that appeals to Germany’s Turkish community), KPN commands a roster of customer-focused MVNOs that represent some of the most progressive thinking in mobile marketing today.

KPN “gets” it – which is why the operator is reaping the advantage. Muriel Arts, KPN’s CMO responsible for its consumer markets in the Netherlands, is quoted as saying: “We have found that you can get more market share by differentiating than building one brand.” She continues: “Consumers don’t all have the same needs. Really knowing their needs and tailoring the customer segments to meet their needs has given us significant advantage.”

More remarkable than KPN’s strong position on the benefits of multiple brands (and segmentation) is the lack of operators willing/able to follow KPN’s lead. Current Analysis’ Emma Mohr-McClune hits the nail on the head when she observes: “I’m quite astonished that no one else has picked up on this in a big way.”

Indeed, KPN has a head start on its competitors in understanding (and acting on) the fact that it’s Marketing 101 all over again: delight the customer with customization, meaningful segmentation and marvellous service.

Retailers have spoilt consumers with choice, and now it’s the operators’ turn. A long overdue shift if we consider that the operator plays a pivotal role in our personal lives. They are the key company that delivers consumers their most personalized services (communications, content, commerce) to their most personal devices (their mobile phones).

Against this backdrop, the Total Telecom feature speaks volumes about the current mobile operator dilemma (a problem for players except for KPN, that is) and the obvious solution.

Mobile operators must accept that they are no longer selling minutes to mass markets; they are expected to create new brands and differentiated offerings rapidly, securely and with real-time management. Their success depends upon their ability to offer the communications services portfolio that fits their target demographic.

In a game where winning is about delivering a wide variety of differentiated (translated: personal) communications offerings to a virtual Long Tail of niche customer segments, a multi-brand strategy is table stakes.

Current Analysis’ Mohr-McClune connects the dots to predict that “this year will be the year of multiple brands.” Operators that haven’t already will need to get their multi-branding strategies on track – or risk that their customers will be the ones walking.

As report author and wireless analyst John du Pre Gauntt astutely points out, the contest at the moment is between the mobile operators, who own the customer data through their direct billing relationship, and the many mobile companies, search engine providers, brands, advertising agencies and vendors who also want to connect with the customer.

Against this backdrop, an “area of intense jockeying will be how location is baked into mobile marketing,” Gauntt writes in his report. The stakes are indeed high as we consider how important a factor location has become in a slew of services – of which mobile advertising is just the tip of the iceberg.

The end-game is literally about delivering consumers “an offer they can’t refuse” because it is so well aligned with their location, presence and context. Mobile operators clearly have what it takes to deliver this new breed of “aware” services, but they are, as Gauntt points out, increasingly under attack from other companies to their left and right in the value chain that correctly sense a huge business opportunity. Today’s partnership between European operator KPN and Artilium recognizes this tension and therefore tips the scales that extra bit in KPN’s favour, allowing it to enable a vast range of new mobile commerce, advertising and social networking services.

At a basic level the partnership between our companies opens KPN’s mobile networks to create an ecosystem of user-generated applications. The software enabling this transformation is Artilium’s ARTA Connected Mobile Services architecture, designed to facilitate rapid creation of new mobile applications, packaged as services. (By way of background ARTA is an open, modular and highly extensible Service-Oriented Architecture that includes a Service Creation Environment, a real-time Service Delivery Platform including Intelligent Network, and a Mobile Presence Server. The Mobile Presence Sever combines highly accurate, continuous real-time location and state awareness to enable the deployment of services that are in synch and in tune with consumers’ and prosumers’ lives and lifestyles on the fly.)

As KPN Mobile Chief Executive Officer, Stan Miller put in this release: “Artilium software allows KPN to surge to the forefront of mobile/Web innovation. We are able to open our network to developer communities worldwide to deliver an infinite range of differentiated services and an exciting new level of personalization and interactivity for subscribers. In doing so, we begin to transform the very essence of our business creating new service-centric business models across a broad value chain that includes developers, advertisers and our commercial partners.”

The partnership includes a licensing agreement allowing KPN deployment of ARTA as a platform for next-generation converged services across its growing base of over 27 million mobile subscribers in the Benelux, Germany and Spain. (The partnership also builds on the successful relationship between Artilium and BASE, the KPN mobile operator in Belgium. Artilium’s ARTA platform currently provides the foundation supporting the more than 30 MVNOs on the BASE network, allowing the operator and its brand partners to provide a broad range of mobile services targeted to diverse consumer groups.)

At one level we can say it’s all about the ability to deliver personalized apps and services that dovetail with users’ locations, presence and even moods (as indicated by their browsing patterns and level of interaction with their mobile devices). But, as this announcement shows, real success depends on the creation of an open and equitable ecosystem that allows operators to lead developers, advertisers and commercial partners in the creation and delivery of context-aware services that unite mobile commerce, mobile advertising and social networking.

Consumers and prosumers alike must be empowered to experience communications on their own terms. That means having a say in how they communicate, with whom, and under what circumstances. Location is a part of this, but so is presence (the availability of the individual at the place and time to take part in an exchange in the first place).

The pivotal role of presence was explored in this post and podcast from MSearchGroove. The audio interview with Simon Wood, Artilium VP of Program Management, discusses presence and the systems that will manage it.

As Simon pointed out: the current crop of location-based services makes a huge and incorrect assumption. From mobile advertising to find-the-nearest-buddy services, they are built from the ground up to deliver services related to a user’s location, when in fact they should be architected to deliver services in an intelligent manner that matches the user’s status, mode and personal requirements.

Put simply, services could be delivered differently depending on context and the company a user keeps. As Simon summed it up: “At certain times of the day, I might want certain calls from certain groups of people to be handled in one way, and another time of day in a different way.” The same goes for content, apps and advertising. The user’s availability and receptability, if you will, must be considered as factors in service delivery.

To automate this, Artilium is exploring ways to rate and rank and effectively “decide” which expressions of presence are more relevant than others, and what actions this knowledge about the user and their circumstances/communications/preferences should trigger. Imagine a scenario in which a user is officially “offline” on Skype but in reality very much present and eager to engage in conversation with certain business colleagues via mobile.

Moving forward, providers will not only need to have the capabilities mix to deliver on the promise of Unified Communications (UC); they will need the intelligent systems that “know” which expression of presence is a mere statement of fact and which one really determines the rules for handling incoming messages, calls, content, and so on.

Against this backdrop, it’s clear the concept of a killer app is passé. This year will not be the year of location-based services. Nor will it be a banner year for mobile search, or mark a quantum leap in mobile advertising. Not even the much-hyped trend to mobile social networking will end up leading the pack. It will be the year of “all of the above” and competitive advantage will be based on the ability to provide a holistic and useful mix of these services that is “presence-capable” and “context-aware.”

Indeed, the race is on to provide a complete suite of applications built on the convergence of services as varied as location-based services, social networking, mobile search, and web 3.0 technologies. The end-game is about offering connected multimedia experiences including information, entertainment, social networks, and navigation. The same approach applies to the enterprise and prosumer segments. Just swap out content sources (say, content providers’ databases for intranet repositories) and shift the focus from linking social networks of friends to enabling communities of expertise.

The list of companies jockeying for position in this space is impressive and growing. It includes nimble newcomers ranging from MobilePeople, SuperLocal, and GeoSentric to established players including Yahoo, Google, and Nokia. In fact, Nokia is probably the most vocal about the impact of “location-aware” services on the future of personal mobility. At a recent mobile search conference organized by Visiongain, Jussi-Pekka Partanen, Nokia’s head of mobile search, outlined his company’s strategy to deliver a slew of services – based around location capabilities such as GPS – that effectively unite the physical, virtual and social worlds we live in.

Put another way, presence and location sit at the centre of how we will experience and organize our lives. In Nokia’s vision, which predictably has the mobile device at its core, users use full-featured phones to map their physical world and the individual social graph of the people and peers who matter most. This creates a framework that will allow them to interact seamlessly with each other and with the content and information all around them.

Granted, the device is a big part of this, but it’s the suite of converged services around presence and location that will make this dream a reality. The pieces will fall into place when the industry begins this year to understand and unleash the power of presence and location to create a sustainable edge (for themselves and their customers), and seamlessly combine and deliver products and services that empower users and combine our physical and virtual worlds.

Industry focus on more enhanced and contextually-relevant mobile services has grown over the last months, boosted by a slew of M&A that involves location (Nokia & Navteq), mapping (Microsoft & Multimap) and personal mobility (Google & Jaiku). Location, or rather location “awareness,” is also a hot topic at mobile search & advertising conferences - even though it was not the intention of organizers to turn the discussion to presence. Mobile Search & Advertising Forum 2008, an invitation-only conference organized by the Wireless World Forum that took place in London just this Monday, is an excellent case in point.

There the debate quickly shifted to mobile local search and the plethora of apps and services that have presence at the core of their value proposition. The consensus: Location is a must-have ingredient of all mobile content and services, including search and advertising. What’s more, offerings that can harness location, presence and the assortment of clues users leave behind as they browse the Web and other information repositories - such as profiles, preferences, purchasing patterns and indications of their social graph -

Put all that together, and companies - mobile operators included - can cover the bases to deliver a new breed of enhanced mobility services that are truly customized and contextually-aware. But the real crowd-pleaser would be the flexibility to move between communications environments as the need and the situation merits: instant messaging for immediate discussions when both parties know they are present and in “chat mode;” Twitter-like services for updates on-the-move; voice-to-text for quick blog updates or voicemails; and the list goes on.

One better - and a feature that would ultimately benefit companies in the search & advertising space - would be the ability to combine this functionality with a self-learning system that would connect the dots to predict my communication needs based on my past behavior. This was a lively discussion point during the forum. Matt Snyder, Founder & CEO of ADObjects, an advertising strategy and consulting firm, coined the term “information roaming.”

As he put it: Users can already roam from network to network, so why can’t they “roam” from communication scenario to communication scenario (fixed, mobile and all the permutations in-between)? It would be even better if the other information around interaction, such as the numbers we call, the people we communicate with, even the search queries we make, could somehow be a part of the mix. Then we would literally be able to take it with us - wherever we go regardless of device/platform/situation.

The audience had some food for thought, and you could hear the “click” as a few service providers connected the dots in their mind. Information roaming is more than a nirvana for prosumers and the companies that have built their bottom line of new ways to serve them up content and services (even commerce and advertising) tailored to their individual needs; it’s a potentially lucrative business model companies can embrace today through the spread of Unified Communication (UC) and advances in personal mobility services.

FYI: Their definition of a UC system is complex, but comprehensive. It includes “elements of presence, instant messaging, IP telephony, audio conferencing, web conferencing or data collaboration, unified messaging (a common message store for voicemail, email and faxes), mobility, and/or video conferencing—all accessible through a single client interface or within an embedded application interface.

“UC is the lifeblood of the connected company, the vast majority of today’s enterprises whose survival depends on real-time communication with their extended organization of partners, shareholders, stakeholders, and anyone else who brings value to the ecosystem. There is a competitive need to streamline the flow of knowledge and information worker expertise throughout the organization, and UC provides a framework for accomplishing just that.

Against this backdrop, the research estimates the entire unified communications products and services market will be $22.6 billion in 2007, growing to $48.7 billion by 2012. Compound annual growth rate over the forecast period will be 13.7 percent.

As David Lemelin, In-Stat analyst, puts it: “The way in which individuals communicate and collaborate in the business setting has changed dramatically in the last few years, but we are just on the cusp of even more dramatic change. Employees will increasingly have intuitive tools that allow them to control communications and presence, while expanding their access to critical information.

“It raises some fascinating questions, which this post pursues in an interview with Dr. E. Brent Kelly, senior analyst and partner at Wainhouse Research. He argues that instant messaging services will become increasingly important as UC grows in to a larger market. The value proposition revolves around the ability of workers to see and reach out to colleagues and co-workers at the critical moment when they need answers or assistance.

Kelly adds: “Since they’re also presence-enabled, end-users don’t have to reach out to somebody and find they’re not there. They can check to see the best method to contact somebody at any given time. Presence is the dial tone of the 21st Century.

“UC is clearly front and center of customers’ minds, and presence certainly tops the list of the elements businesses will likely roll out first. Kelly confirms this, hinting that instant messaging, IP telephony and audio conferencing are “almost universal” – although it’s quite unlikely it will be a feature on every desktop. As with all services, these elements should only be deployed where it makes business sense.

The takeaway: UC is at the foundation of strategies that will allow companies to capitalize on, and adapt to, change moving forward. To succeed, the enterprise must absorb mobility and presence into its way of doing business. Not only is access to the right information at the right time essential to running an efficient and informed enterprise; reaching the right person at the time is a competitive differentiator.