Nokia's Microsoft Deal Could Drive Mobile Ad Growth

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Nokia has thrown in the towel in the smartphone operating system race, choosing Microsoft's Windows Phone 7 platform to power the majority of its new handsets in a partnership that could significantly accelerate the growth of the newly launched platform.

That growth could have positive implications for the bourgeoning mobile ad market too, potentially accelerating the uptake of smartphone devices and providing another channel through which advertisers can reach consumers on the move.

"The Microsoft and Nokia announcement illustrates the magnitude of what is at stake in the mobile ad ecosystem… As consumer behavior shifts from PC Web to portable mobile devices, mobile advertising will eclipse traditional PC ads very quickly," Paran Johar, chief marketing officer of mobile ad network Jumptap, told ClickZ.

Following the Microsoft arrangement Nokia will effectively cease development of the Symbian platform that previously powered its smartphone devices. Although mobile networks and ad tech firms do enable the serving of ads to Symbian devices, much of the attention garnered by the mobile ad space over the past twelve months has been focused on opportunities on Apple's iOS and Google's Android platform. Apple's iAd product is a prime example of this.

"Clearly Apple and Google have taken leadership positions along with some of the independent ad networks," said Johar, in reference to progress the mobile ad market made in 2010. However, he predicts the teaming of Microsoft and Nokia could help the pair "catch up in this exploding business."

Besides growing the reach of its mobile OS, Microsoft also stands to make significant progress in the mobile search market thanks to Nokia. The partnership will see Microsoft's Bing engine power search services across the manufacturer's devices, and subsequently selling ads against search results via its adCenter platform.

As Google executives expressed yesterday, mobile search has exploded over the past year, with queries from mobile devices on Google.com growing 300 percent in that period. Microsoft recognizes the potential of mobile search, it appears, as well as mobile display advertising following the launch of its Advertising Exchange for Mobile in October.

Elsewhere in the mobile ad space U.S.-based network and Jumptap competitor Greystripe announced its official launch in Europe today. Through partnerships with other networks including Hi-media, madvertise and Mobile Ventures, the company plans to take its mobile rich media offering to the U.K., Germany, France, Italy, Spain and the Netherlands.