With mobile marketing on the rise and data-enabled phones working their way up the market's food chain, the opportunity for carriers to implement ad-funded mobile email is right around the corner.

The question lies in whether or not consumers would accept a line of targeted advertising inside their emails in exchange for free mobile email services. Mobile Marketer's Jordan Crook interviewed Carsten Brinkschulte, CEO at Synchronica PLC, London, who believes that ad-funded email is a strong enough value proposition to become widely adopted by the consumer market. Here's what he had to say:

What is the current state of ad sponsored mobile email?
Ad-funded mobile email is still very much in its infancy. So far, mobile email has been focused on the high-end of the market, predominantly the business user. Typically, ad-funded mobile email is not expected to be successful in the business user space. It's much more applicable to the consumer space. Consumer mobile email is still in its early stage; however it is expanding much quicker than the business mobile email market. There have been some experiments with ad-funded mobile email, and it's working technically. Commercially, however, I am not aware of any high-volume implementations.

Where is it going in the next year or so?
I expect ad-funded mobile email to have a substantial take-up rate over the next couple of years. Mobile email is rapidly expanding into the mass market and into the consumer space. The concept of ad-funded mobile email will be much more successful than it has been in the past. There is a huge potential for it in the coming years. When you think about it, free mobile email is a concept that works well and is attractive to consumers, but it only works if someone pays for it. Ad-funded mobile email is a way for carriers to monetize mobile email in the consumer space without having to charge the end-user for it. This is something that can help to dramatically increase the take-up rate of mobile email in the mass-market, and help advertisers target consumers.

Can you think of any campaigns in this area?
I can't think of any mass implementation by a carrier that's been highly successful to date. However, there are a few experiments out there. At Synchronica, we license our Mobile Gateway software to carriers, which are then offering it as a subscription service to the end-users. Normally, an end user would have to pay to use Mobile Gateway, but now some of our carriers are considering introducing ad-funded mobile email and offering the service completely for free to the end-user.
We're running trials and experiments with the ad-funded mobile email and we have more than a dozen carriers in live operation of the regular version of our Mobile Gateway, but most are still charging the end-user for using the service. We are talking to some of them about using an ad-funded version of our products to accelerate the expansion into the mass market.

What will ad-funded email look like in the inbox of the end user?
In the ad-funded version of Mobile Gateway end users will continue to receive their email in the same way they do with our standard product. Every email arrives in the inbox on the phone and users can then read, respond and compose new emails. If you subscribe to the ad-funded version, we will add a tag - a single text line either at the beginning or the end of the email you receive. The carrier can choose whether we prepend or append the ad to the message. If you browse the Internet and search a page - say you search for furniture - and Google shows you the content, on the right side there will be little text ads - very simple non-intrusive text ads that can be from the local furniture shop on the corner who is advertising a sale. That's the same way that ad-funded mobile email works. At the beginning or end of the email, it will insert an ad for something that is relevant and relates to the email you are reading. That is the power of ad-funded mobile email. It is a marketer's dream. You can tailor the ads we insert into the text and pick relevant ads to add to the email being received. So for example, if you open an email where a friend is complaining about her car breaking down, the relevance-ranking engine much like Google's can automatically find an ad that matches the email?s content and will then place it right into the email's body.

What will this look like from an advertiser's standpoint?
We do a lot of work with advertisers directly, or rather, we work with advertising aggregators. Google is one of the largest advertising agencies right now and Google is a great way to source ads and place them into emails. If you have a Web page, you can embed Google ads into your Web page and you will be paid for showing Google's ads. Operators could use the same mechanisms to be paid for those ads in mobile email. So the carrier can enter into a contract with Google or other advertising aggregators and Synchronica's Mobile Gateway will act as the delivery man. We work with ad engines provided by Google and others that actually manage the ad content and select the relevant ads.

If ads are relevant, won't that make privacy an issue?
Privacy is absolutely a factor. Our Mobile Gateway handles and looks at the content of your mail. However, email is not necessarily a media where you have privacy or security anyways. Every email you send and receive travels unencrypted over the Internet. Many people can get their hands on your email before it reaches you. If you are a Yahoo! or Google mail user, you are already being presented with ads that are relevant to your email in your Web browser. We just take that concept and apply it to mobile email. I don't see a major problem for privacy. I also think that in the consumer space, this may not be as important as it is in the business user space. And of course, when people subscribe to free mobile email, they will have to accept the terms and conditions that state that the carrier may look at the content of the mail and potentially place relevant ads. But those are similar to the same terms and conditions for MSN, Yahoo! and Google mail. It's not uncommon that companies who offer free service in turn use your data in an advertising context.

Would subscribers be willing to receive ads in exchange for mobile email?
Yes, in exchange for free email. That's the point. Subscribers won't be open to emails and ads if they have to pay for the service. If your carrier gives you free push email and you don't have to pay for it at all, then I think many consumers would be willing to accept a little text ad in every email they send or receive. It's not intrusive. There are no big banner ads being thrown at you. We're talking about one line of text inserted when you read it. If the service is being run correctly -- meaning it's non-intrusive and users can receive it for free - then I think most consumers will accept it.

Who are the big players in this space? Who do you expect will rise in this space in the coming years?
The carriers are in a very good position because they control the billing to the mobile user. I think the carriers are in a much better position than the ISP's like Google or Yahoo!. Google might be able to put ads into their mobile service, but the user will still have to pay the carrier for the data traffic when receiving the email. The carriers are in the best position to introduce ad-funded mobile email, because they have the power to drop the price to zero in exchange for ad-funding and only they have the power to do that. Google still plays a big part because they can manage the ads. I don't think that carriers themselves will manage the ads. You've got a cooperation of several parties that will make it happen and make it big. Carriers will do the billing and operate mobile email middleware services like Synchronica's Mobile Gateway. Mobile Gateway is the middle man; it takes email from your email account and pushes it to your phone. And then you have the ad engines provided by Google, Microsoft and others which have the relationship with the advertisers - that is the value chain.

Why do you see this being a revenue earner now and in the future?
I think ad-funded mobile email will be a very relevant revenue generator when combined with the concept of free. It will be very attractive and can be highly successful because most people are interested in free services in the consumer space. The concept of free ad-funded mobile email will enable mobile email to become a mass market service. There is a lot of potential - look at Google's revenue, it's already coming from ads in free services. The interesting aspect of email is that you have high volumes and you have repetitive access to the service. Mobile email lends itself very well for advertising because you use it several times a day and it requires close attention of the end user - you don't glance at it, you read it - and therefore it will be highly successful for advertisers. There is a lot of revenue to be made for carriers and the rest of the supply chain.