| Google CEO Eric Schmidt made a comment | | | | of Japan's telephone networks, where shopping |
| speaking at Stanford's School of Business a few | | | | via the cell phone screen has become a reality. |
| weeks ago that has rattled teacups all across the | | | | According to Schmidt, however, Google has no |
| communications industry. Schmidt commented | | | | current plans to give away phones and he is |
| that he could see a future that included free cell | | | | unaware of any effort by phone manufacturers, |
| phones provided to users who accept watching | | | | cell phone service providers or Internet phone |
| targeted advertising. | | | | services to do so. |
| His observation was that mobile phones are | | | | However it is a mistake to ever take offhand |
| adopting more and more characteristics that bring | | | | remarks from Google executives lightly. While the |
| them closer to handheld computer status. Their | | | | question of phone availability either at low cost or |
| functionality has expanded to text messaging, | | | | cost free remains an open one, the specter of |
| email and web access. Schmidt referenced | | | | advertising on cell phones is no longer a question |
| research that predicted a rise in cell phone use to | | | | at all. Cell phones will soon be able to provide the |
| as much as eight to 10 hours a day for purposes | | | | targeting data for advertising that computer clicks |
| of talking, texting and using the Web. With a | | | | provide now. When advertisers are able to |
| device so thoroughly integrated into personal daily | | | | harness that data, the cell phone advertising |
| life, advertising becomes a viable form of revenue | | | | market is going to become increasingly enticing. |
| - and hence, a source of subsidy for free phone | | | | An analysis of Google's acquisition of YouTube |
| distribution. | | | | included the observation that with the fragmenting |
| With a nod to reality, Schmidt observed that | | | | of broadcast television, there were $67 billion in |
| mobile phones may never be completely free. He | | | | annual advertising dollars out there in the hands of |
| noted that newspapers have had a financial model | | | | people who are uncertain where to place them. |
| based on advertising for a century, but have | | | | This particular analysis speculated on the possibility |
| never been free - although they are certainly | | | | of Google's ability to guide some of those dollars |
| inexpensive. Actually, some of the more | | | | to YouTube. |
| successful newspaper ventures remaining are the | | | | Google's notion of utilizing the cell phone as an |
| free neighborhood weeklies that land on your | | | | advertising vehicle should be considered in the |
| doorstep. On the other hand, television empires | | | | same vein. It may not be on the radar screen |
| were built on advertising and the networks have | | | | currently, but that doesn't mean that a company |
| never been known to subsidize TV distribution. | | | | with the money, the power and the talent of a |
| Google has been experimenting with providing | | | | Google can't put a major blip on that screen in |
| text and video ads to cell phones with LCD | | | | short order. |
| screens. They have developed alliances with some | | | | |