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Publicis Acquires Mobile Shop

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NEW YORK Publicis Groupe hopes to jump-start its mobile capabilities with the purchase of European mobile shop Phonevalley.

The seven-year-old, 60-person shop runs mobile campaigns for advertisers in five European markets. It does both creative and media buying, handling over 1,000 campaigns last year, Publicis said. Clients include Colgate Palmolive, Air France and Paramount. Its campaigns include text messaging, running banner and text ads on mobile sites and creating mobile applications.

Paris-based Phonevalley will become the mobile unit of Publicis Groupe Media, comprised of Starcom Mediavest Group and ZenithOptimedia. It will continue operating as a separate company, working with Publicis agencies and others.

Terms of the acquisition were not disclosed.

Alexandre Mars, the company's 32-year-old founder, will become head of mobile for Publicis Groupe Media in Europe, charged with educating Publicis agencies about including mobile marketing in their campaigns.

"Digital is not only the Web," he said. "It's now the Web plus mobile."

"What we need and other digital agencies need are technical expertise and to have people that can properly integrate with the carriers and other platforms for things like mobile search," said Nick Pahade, executive director of digital development for Publicis Groupe Media.

Mobile marketing is still a small market, particularly in the U.S., but is expected to grow exponentially. ZenithOptimedia anticipates worldwide mobile ad revenue will rise from $871 million last year to $1.4 billion in 2007.

Other holding companies are bulking up their mobile offerings. Earlier this year, Aegis Group acquired Marvellous Mobile, a United Kingdom-based shop that worked with fellow Isobar agencies to create the Sprite Yard, an ambitious mobile social network Coca-Cola rolled out in China and the United States this summer. Omnicom Group bought mobile shop Ipsh two years ago.

Other holding companies held talks to acquire Phonevalley, Mars said.

The company hopes to expand to other geographies, including the U.S. and Asia, he said.

"We want first to build a strong foundation in Europe," he said.

Publicis CEO Maurice Lévy has tabbed digital as an area of expansion for the holding company. It paid $1.3 billion for Digitas last December, then added French digital shop Business Interactif in June.