Perhaps you’ve noticed the hype about the coming mobile advertising boom. So has BusinessWeek’s Olga Kharif, who tries to pour cold water on the nascent industry: Predictions that the market will go from less than $1 billion today to $10 billion or $14.4 billion by 2010 are wishful thinking at best, she argues.
But as the last boom and bust proved, just because growth projections are overzealous doesn’t mean that there isn’t an underlying truth there: Most of the metrics that drove Web 1.0 investment theories (broadband adoption, size of Internet advertising market, etc.) are panning out – they’ve just taken longer than expected.
Expect the same thing with mobile: As we noted last month, Citi’s Mark Mahaney lays out a persuasive case for much more modest market by 2010: Just one monthly search per each 2010-estimated 4 billion mobile phones would generate mobile search revenue of $2.3B.
That’s plenty big enough to make mobile a focus for the likes of Yahoo and Google. It’s likely not enough to support the dozens of new mobile advertising startups, though: Just like their Web advertising brethern, the most successful will end up as GOOG/YHOO acquisitions.
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