The latest Global Mobile Media forecast from Strategy Analytics has predicted that consumers will increase their spending on mobile media by a further 13.4 per cent from $121.8bn in 2011 to $138.2bn in 2012.
Cellular-news.com, on Saturday, said 2011 was the first year that global consumer spending on media content, apps and services for mobile phones broke through the $100bn barrier.
In contrast, advertiser spend on mobile media is expected to almost double (85.4 per cent) from $6.3bn to $11.6bn, resulting in the total mobile media economy reaching $149.8bn in revenue in 2012 — a 17.0 per cent increase on 2011.
Whilst the lion’s share of consumer spend (60.2 per cent) is on data plans and web browsing – making mobile operators the key beneficiaries to the tune of $82.8bn in 2012, up 9.5 per cent on 2011 – a key driver of growth is the apps market on smartphones, such as the iPhone and Android devices.
Over 23 billion apps were downloaded globally in 2011, increasing by 38 per cent to over 32 billion in 2012. Apps are now the second largest category for revenues — for both consumer and advertiser spend – and are becoming the key distribution mechanism for media on mobile phones.
Apps are expected to account for 18.9 perc ent of global consumer spend in 2012 — $26.1bn, up 30.7 per cent on 2011 — but the strength of the apps ecosystem is also demonstrated by advertiser spend. For example, across the United States and major Western European markets as a whole, revenue from display ads on the mobile web ($934.5m) has been overtaken by in-app advertising ($1.7bn).
The Strategy Analytics’ Director of Wireless Media Strategies, Mr. David MacQueen, said, “Advertisers chase eyeballs so the fact that brands spend more on in-app advertising than the mobile web is a clear sign that apps are what consumers are glued to for an increasing range of activities. In the eyes of many advertisers, web browsing on the smartphone is playing second fiddle to the app economy.”
Despite remaining relatively flat in terms of spend, Music remains one of the top mobile media categories — accounting for $16.0bn or 11.6 per cent of 2012 consumer spend.
However, the way consumers’ access and pay for music is changing. Ringtones are declining fast, but streaming music services such as Spotify, Pandora and Deezer – paid for by subscription or through advertising – are gaining good traction in Western Europe and the USA.
As with apps, growth of mobile video usage is increasing dramatically; 108 billion videos were watched on mobile phones in 2011, almost trebling to 280 billion in 2012. However, unlike apps, this isn’t translating into symbiotic revenue levels. Despite a 23.8 per cent revenue growth, Video is likely to account for a mere 2.4 per cent ($3.6bn) of total mobile media revenues in 2012.
MacQueen said, “Low revenues are down to many major mobile video services being free to the end user, either funded by advertising (such as YouTube) or “bundled” without additional cost by pay TV providers, such as Sky Go around Europe or AT&T U-verse in the USA. Despite the huge audience of 271 million users, ad revenues from mobile video are tiny – a meager $223m globally in 2011. While ad revenues will more than triple to $726 million in 2012, it is still clearly challenging for advertisers looking to reach consumers through video ads on smartphones.”
Revenue related to Social Networking content, apps and services is expected to increase by 16.1 per cent to $17.6bn — accounting for 11.8 per cent of all mobile media revenues.
The United Kingdom mobile media economy is expected to outperform the global 17.0 per cent growth figure, increasing by 21.9 per cent to almost £2.5bn in 2012. UK consumer spending is also expected to outperform the global rate (16.6 per cent vs. 13.4 per cent) to just under £2.2 bn although advertiser spend will increase slightly less (81.1 per cent vs. 85.4 per cent globally) to £305.4m.
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