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Mobile Advertising Set to Explode. Are You With That Program?

March 8, 2011

by Kerry Brewer

It looks like the Google Android platform is pulling ahead of the competition. The latest Nielsen study shows the Android as the number 1 operating system, followed by iPhone and BlackBerry. As many know, iPhone was the 800 pound gorilla for the last couple of years, but leave it to Google to play catch up in a hurry. In comparison to the rest of the Apple universe, iPods and iPads, Google is still behind in total units, but dont forget that the Android operating system runs on a lot of other competing devices as well, like the Motorola Xoom tablet, for instance.

The iPhone app store now boasts over 350,000 apps, and according to the Android Forums, there are now over 250,000 Android apps, and growing faster than the federal budget deficit at that rate. There were approximately 50,000 Android apps this time last year, according to MobileCrunch. Studies by Research2Guidance show the total download app market for Android and iPhone will reach a whopping $15 billion by 2013.

According to some recent numbers from Nielsen, 40.8 percent of smart phones purchased in the last six months were running Android OS, followed by 26.9 percent that were running Apple iOS and 19.2 percent that were running RIM BlackBerry OS. And a news flash from Cisco states that mobile data traffic is expected to increase by over 20-fold in the next 5 years. If this is indeed true, then many businesses and marketers will be jumping on the bandwagon.

It looks as though the mobile advertising market is set to become the next big market for businesses and marketers. Along with that, we should expect to see increasing mobile network speeds and capacity as the market continues to build out over the next 10+ years. This will be a necessity in order to keep up with demand. Mobile broadband and WiFi will have to increase their capacities by a similar multiple factor if we are all going to eventually enjoy a fast and mobile life on the web.

In-app advertising is becoming all too easy and simple to set up, with companies like Googles AdMob, Apples iAds and other agencies like Millennial providing easy-to-use SDKs (Software Development Kits) driven by APIs (Application Programming System) using jquery and json, the latest javascript programming formats. Companies like AdLarge, TargetSpot and Ando Media, traditional  providers of in-stream ads for desktop, are also starting to develop APIs for mobile devices as well.

The biggest problem right now in the mobile market is that there are so many apps coming on the market that are being monetized by in-stream ads, that there is more supply than demand, leading to low fill rates in many cases. In fact, Apple just dropped their buy-in rate for advertisers from a cool million to $500,000. Apple iAd customers have recently reported fill rates as low as 8 14%, so there is a huge demand for advertisers to fill the space created by so many new publishers.

Not only are smartphones becoming as common as a PC, but more and more people are coming to realize and accept that advertising will drive the mobile streaming market and online music, just like it drives print, radio, TV, Facebook . . . well, you get the point.

As we like to say, you better get onboard the train, cuz its leaving the station!

Kerry Brewer is Sr. Managing Director at Securenet Systems. He can be reached at  kbrewer@securenetsystems.net

 

 



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