Cellphone ads ring up privacy concerns

NEW YORK -- Your cellphone is a potential gold mine for marketers: It can reveal where you are, whom you call and even what music you like.

Considering the phone is usually no more than a few feet away, these are powerful clues for figuring out just the right moment to deliver the right coupon for the store just around the corner.

But first marketers will have to wrest the personal profiles from mobile carriers worried that annoyed subscribers might defect to rivals.

"It's proceed with caution," said Jarvis Coffin, chief executive of advertising distributor Burst Media Corp. "Are consumers going to be spooked by the idea that suddenly their phone goes beep and it's a Starbucks offer, and they are standing next to a Starbucks?"

Carriers are now guarding the data zealously, but many people believe it's only a matter of time — over the next year or two — before marketers can routinely target ads to a potential customer's location and actions.

Imagine getting pitches for rental cars and hotels the moment you land in San Francisco because an analysis of past calls suggests you tend to take week-long trips there. Or if day trips to Boston are your thing, you might get an offer for cab service instead.

"My phone has a lot of very specific and detailed information about myself ... information that isn't always going to be resident when I'm at a number of PC browsers," said Rob Adler, chief executive for mobile Web company go2 Media.

The research firm eMarketer estimates that U.S. spending in mobile ads, at about $900 million in 2007, will grow more than fivefold to nearly $4.8 billion in 2011. By contrast, paid search and other online spending will only double, to about $42 billion in 2011.

Mobile ads today are mostly blasted at the mass audiences, with a few carriers offering limited targeting based on users' age, gender, ZIP code and other characteristics.

That should change. Ever since the Federal Communications Commission ruled in 1996 that wireless carriers must help 911 dispatchers identify a caller's location, technology companies and privacy advocates alike have been speculating about making phones' location information available to commercial services and advertisers.