US advertising spending on mobile media will total more than $700 million by 2012, up from nearly $88 million in 2008, according to Screen Digest's "Mobile Media Advertising Opportunities: The Market for Advertising on TV, Video and Games" report.
The research company predicted that the far-more developed mobile markets in Japan and South Korea would each have higher ad revenues this year for mobile TV, gaming, user-generated content and video on demand than the US.
"Data pricing structures, handset and mobile web
usability, content quality and the lack of audience metrics to measure effectiveness are preventing mobile advertising from reaching its
market potential,"
said Julien Theys, who wrote the report for Screen Digest.
"Although we expect these hurdles to be overcome in the coming years, mobile media advertising will have to compete with
search, display, messaging advertising as well as many innovative uses of mobile in marketing campaigns," Mr. Theys said.
Another reason the US lags in mobile media ad spending is that Japan and South Korea both have free-to-air mobile TV broadcasts. Such content usually requires a paid subscription in North America and most of Europe, and this makes for slower audience growth.
eMarketer's own US mobile ad spending estimates focus on messaging, display and search. Mobile media ads represent a fraction of mobile display ads.
Although the promise of millions of iPhones and other devices to deliver a mass mobile media audiencein the US is great, it remains more promise than mainstream reality.
Only 15% of responding ad executives in the Screen Digest study said that they had used mobile advertising. Similarly, more than six out of 10 responding agency executives in a December 2007 study by iMedia said they would not put a large portion of their 2008 online budgets into mobile.
"There remain clear growing pains ahead for mobile advertising," said John du Pre Gauntt, senior analyst at eMarketer. "There are sticky
disagreements concerning mobile customer information among mobile
operators, Web portals, brands and agencies.
"All agree that better
contextual targeting (for example, location, time, history) is a
prerequisite for mobile advertising to succeed. But how to get there in
the short-term remains an open question."