Vodafone, Yahoo Join Forces for UK Mobile Ad Business

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Vodafone and Yahoo have formed a strategic alliance this week to pool their expertise and create a mobile advertising business to enhance the customer experience on mobile phones while providing new revenue streams for the respective companies.

With this partnership, Yahoo is now Vodafone’s exclusive display advertising partner in the UK.

The plans dictate that customers who opt-in to accept carefully targeted display advertisements can reap the benefits and savings of certain Vodafone services. In turn, this offering could extend to Vodafone mobile assets including the Vodafone live! portal, games, television and picture messaging services.

“Since we announced our intention to develop revenue from mobile advertising as part of our mobile plus strategy unveiled in May, we have carried out extensive customer trials,” said Nick Read, chief executive of Vodafone UK, in a statement. “We will now use the experience to determine with Yahoo! how best to ensure customers, who choose to receive targeted messages, get better value as well as a richer mobile experience. This will also ensure that advertisers are given a compelling proposition.”

With a rollout target date set for the first half of 2007, the Yahoo deal should hopefully turn things around for Vodafone, which according to Red Herring, also announced today a loss of $8.6 billion during the first of 2006–partly due to an €8.1-million ($15.5 billion) charge related to the mobile operator’s German and Italian operations, citing tax issues and competitive pressures.

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