Are mobile ads the next big thing?

We’ve all seen the growth of Facebook, buy information pills
especially those that have seen our bandwidth (and in some cases productivity) in the office take a hit in recent years. Many also knew that the company became cash positive in 2009 thanks to a blog post by Facebook CEO Mark Zuckerberg in September.

Would you have expected the company to have revenues approaching the billion mark? Reuters is quoting two sources saying that the company’s 2009 revenue was between $700 million and $800 million.

There is increased buzz about the company getting ready for an IPO but the question is why? It does not appear that they are holding back any substantial growth due to a need for capital. Their current financial position should allow any debt to be paid off. Investors will want an exit strategy at some point, but there are also great advantages to remaining private.

Will we see a Facebook IPO before the end of 2011?
Kevin Ryan, hygiene
the former CEO of online-ad company DoubleClick, said he doesn’t see mobile advertising delivering on huge promises talked about by Google, Apple and others. He talks about how there is almost no mobile advertising today, how e-commerce sites get very little of their sales from mobile and the limited screen size. See the WSJ blog post:

Where do you see the future of mobile advertising going? Does location based advertising change the game, or is an enhancement to a portion of the overall mobile advertising experience?

In my opinion, the current state of mobile advertising does not predict its future. There are two main areas of potential growth within mobile advertising:

1) Target Market: We are just now beginning to reach critical mass (in terms of targetable demographics) in the U.S. and many countries in Europe. We all see and hear the talk about the iPhone and smart phones, but the fact is that these still make up a small portion of overall mobile users. We will see smart phones with active data plans increasing as a percentage of the install base, but this will take time until the prices for data plans drop by another 50% to 75%.

2) Technology Advances: Many of the technologies that allow the advertising experience on mobile devices to capitalize on the mobile experience are new and are still developing. As an example, we have only recently begun to see location based advertising enter the market and advertisers (agencies) are still working to understand the best way to use this technology. What else can make the mobile advertising experience more beneficial to both advertisers and users? How can we better tie the mobile experience into the physical and fixed internet worlds?

Let’s not rule out the future of mobile advertising based on current technology. This is where companies that are able to truly leverage the ideas of employees and encourage innovation shine in the marketplace.

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