Mobile ad spending to grow 80% in 2012; grew 82% for music, video, game services in 2011

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Issue Date: 
Jan 26 2012 - 8:00am

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eMarketer's predictions for mobile ad spending over the next few yearsThe U.S. mobile advertising market is "growing far faster than expected," according to new predictions from eMarketer. Users may be happy to accept these ads as long as the mobile app or service is free.

eMarketer now predicts that mobile ad spending will grow 80% in 2012, reaching $2.61 billion. That's an upgrade from their earlier prediction of $1.8 billion. It predicts display advertising will grow 93.5% and video ads will increase 122%. "By 2015," eMarketer writes, "ad-supported mobile content revenues in the U.S. will surpass $1 billion, with growth rates slower but still strongly in the double digits."

Looking specifically at ad-supported mobile music, games and video services, eMarketer predicts ad revenues will grow 52.7% in 2012 (reaching $433.8 million) after growing 81.9% in 2011. By 2015, eMarketer estimates around 30% of mobile music, video and gaming revenues will come from ads. 

Borrell Associates recently predicted that mobile audio ad spending would reach $667 million by 2016 (RAIN coverage here).

Moreover, mobile users seem to approve. Nielsen's State of the Media report for 2011 found that 51% of mobile users are happy to accept mobile ads, as long as the app is free. The report also found that 45% of tablet and smartphone users downloaded a music app in a 30-day period. And 27% of users paid for a music app.

Mobile devicesThis all may be great news for Internet radio. Monetization of mobile listening is reportedly less than that of desktop listeners for some webcasters -- even as mobile becomes the dominant way to tune in to web radio.

For example, in October 2011 a Morgan Stanley analyst claimed that Pandora's desktop listeners generate nine times the revenue of the service's mobile users (RAIN coverage here).

You can find eMarketer's predictions here and here. Ars Technica has more coverage on the Nielsen report here.


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