Informa Telecoms & Media (News - Alert), a U.K.-based provider of events, research and training to the global telecoms and media community, forecasted that from $707.6 million in 2011, the in-app advertising market on mobile phones will jump to $10.2 billion in 2016.
According to Informa, in-app advertising is the fastest growing part of the mobile advertising market, as display advertising on mobile sites and paid mobile search is bigger. Brands and advertisers still spend less on wireless than on personal computers, TV, print and radio.
Informa forecasts that from $8 billion this year, the global mobile advertising market will generate revenue of $12.8 billion in 2013.
"In-app advertising has experienced the strongest growth in recent years. The main driver for in-app advertising is the growing number of smartphone users, particularly Android (News - Alert) users who are now spending more time using apps than browsing,” said Shailendra Pandey, Informa analyst, in an e-mail.
He added that most mobile ad networks are seeing the majority of its ad impressions on smartphones and an increasing proportion of those ads are being served in mobile apps. In order to drive the in-app market for building websites and mobile apps, the emergence of HTML5 as a new standard programming language will definitely help.
On all types of mobile Internet devices, it’s believed that HTML5 can help by making it easier to deliver ads. On the iPhone (News - Alert), HTML5 will also help to deliver high-quality ads in rich-media formats, which due to iPhone's inability to run flash, has been difficult so far.
According to Informa, wireless service providers such as Vodafone (News - Alert) and AT&T will likely struggle to make money from mobile advertising. Pandey concluded by stating that from mobile Internet advertising, mobile operators can only expect a very small share of revenue.
But from messaging and voice-based mobile ad campaigns, they will continue to take a large share of revenue.
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Edited by Braden Becker