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Experts predict cell phone revolution

Image: Eric Schmidt, CEO of Google
Eric Schmidt, CEO of Google, addresses a panel session on mobile technology during the annual meeting of the World Economic Forum in Davos, Switzerland.Alessandro Della Valle / EPA
/ Source: The Associated Press

Top technology executives at the World Economic Forum on Friday said mobile Internet will eventually let advertisers tailor messages based on a user's location.

"After all, they know where you are. You're driving along and it says, 'Eric, you had pizza yesterday and there's a hamburger stand on the right.' In theory location-based advertising will be a very good business and useful to the end user," said Google CEO Eric Schmidt.

Schmidt was joined on the panel by the heads of Sony Corp., NBC Universal and China Mobile Communications Corp.

Schmidt was upbeat about the changing industry, predicting "a huge revolution."

"It seems obvious that advertising, that works so well on the traditional Internet, should also work well on the mobile Internet," Schmidt said.

Moderator David Kirkpatrick noted the number of people with cell phones far outnumbers those with personal computers.

"It will not be long before we are all carrying video (transmitting) cell phones. What we now call the cell phone is becoming the de facto Internet device. The technology industry is rapidly becoming the mobile technology industry," said Kirkpatrick, who is the senior editor for Internet and technology at Fortune Magazine.

Wang Jianzhou, whose company is the largest mobile provider in China, noted China boasts a half billion mobile users and is adding to the number at a rate of 6 million per month. The future, he said, was with "location advertising" enabled by the devices' global positioning system.

SONY CEO Howard Stringer was more skeptical, saying young users of mobile phones don't like advertising.

Moderator Kirkpatrick cited estimates that the U.S. mobile advertising market is just under $1 billion annually for at least four years more, a paltry sum.

But Schmidt said the estimates would be adjusted upward once the business reaches a "tipping point," which will be ushered in by new technologies.

"We need to create that framework in which the really creative people can build (mobile) applications that none of us can even imagine. That is the recreation of the Internet, the recreation of the PC story and it's very exciting. It'll happen in the next year. It will be big."

U.S. congressman Edward Markey, a Massachusetts Democrat, meanwhile noted that the prospect of advertisers knowing where users are through GPS was "bone-chilling."

"It does raise significant privacy concerns," agreed Kevin Martin, chairman of the U.S. Federal Communications Commission, which regulates the industry.