Will WAP wipe out banner ads?

The wide deployment of wireless application protocol-enabled mobile phones will change the business model of advertising on the Internet, according to loyalty program provider SurfGold.com.

The trend will be away from banner advertising and towards instantly rewarding surfers for accessing services via WAP-enabled mobile phones, managing director Eugene Lee said here on Wednesday at the official launch of SurfGold.com's loyalty program.

SurfGold.com offers loyalty points to consumers for registering at its site, for volunteering information about their personal preferences, and for shopping at the 30 international and local merchants that are part of the program.

"You cannot get a full-page screen on a WAP phone so banner advertising will become irrelevant as a marketing concept," Lee said. "When you have a WAP phone, merchants will pay to reach you."

Phones Rule

Twice as many mobile phones are in use worldwide as PCs, and the ratio will be five to one--roughly 1 billion mobile phones to 200 million PCs--within three years, Lee said.

"Mobile phones are going to become pervasive," he said. "And it is extremely important that WAP has emerged as an open standard."

WAP phones will make redeeming points earned through loyalty programs much easier, Lee said. Instead of receiving a printed voucher from a supplier or through the post, subscribers dial into their SurfGold.com accounts and their loyalty points balance will show up on screen for a merchant to verify, according to Lee.

"These applications give instant redemption and therefore instant gratification to the consumer," he said.

Banks will also be fast adopters of WAP applications, due to the extra convenience and cost savings of phone banking, according to Lee.

"Instead of spending money conducting face-to-face bank transactions, banks want to spend money to push customers online," he said. "The banks will use WAP to modify customer behavior from offline to online."

Launching in Asia

SurfGold.com will launch its WAP applications in Singapore in the middle of next month, shortly after the network providers and mobile phone suppliers start commercial WAP services, Lee said.

SurfGold.com currently runs Web-based surf and shop loyalty programs in Hong Kong, Korea, Singapore, and Taiwan. By June, it expects to have begun operations in Australia, China, India, Japan, and Malaysia.

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