Data protection will be next hurdle for m-commerce

27 Nov 2007

The same battles over privacy and the use of cookies currently being waged by Google and MSN will impact future providers of mobile content, John O’Shea of Zamano said yesterday following his company’s €24.4m acquisition of Red Circle.

Digital Hub-based Zamano’s acquisition of Dun Laoghaire-based Red Circle will grow Zamano’s headcount to 68 people through the addition of 28 Red Circle staff.

As a result of the acquisition, Zamano is on the path to revenues of €60m in the year ahead.

The acquisition is Zamano’s second major deal this year after it acquired mobile entertainment firm Eirborne Text Promotions for €8.5m in April.

O’Shea described the acquisition as “transformational” for Zamano. “It more than doubles our revenues and extends our geographical footprint to include the US.”

Red Circle competes head on with premium SMS firms like Jamster and Partymob for consumers, offering everything from ringtones to wallpaper and video content for their mobile phones.

Typical brands Red Circle partners with include Saatchi & Saatchi’s Global Urban Media Division as well as leading men’s magazines Loaded, FHM, Nuts Magazine and Maxim.

The company, which last year reported revenue of €31m, delivered a profit of €3.3m after tax. The company has over 500,000 active subscribers in the UK, Australia, the US and Ireland.

O’Shea said it is an exciting time for the mobile internet because very little web content is available on handsets, but this is about to change in a big way. “We expect considerable upside in terms of content and interactivity.”

However, as advertising opportunities emerge on mobile, O’Shea predicts a similar issue over data protection and the use of cookies as advertisers try to track users. “Until now players like Zamano have been active in the messaging space but over time when people visit WAP (web application protocol) sites advertisers will seek to gain access to who they are.

“This will obviously place an enormous responsibility on service providers to retain records and it is important that this can be managed in a positive way and of benefit to the consumer,” O’Shea said.

By John Kennedy