With reports suggesting that Amazon wants to join other hardware makers such as Apple, Google and Samsung in owning a platform for selling and serving mobile ads, independent mobile ad networks are facing growing competition.

The word on the street is that Amazon wants to acquire its own mobile ad network. This would put the Kindle Fire maker in good company with Apple, Google and Samsung also either acquiring or building their own mobile advertising platforms.

"The phenomenon you are seeing with Amazon, Apple and Samsung is that they are no longer just a hardware manufacturer or just an ecommerce platform," said Noah Elkin, principal analyst at eMarketer, New York.

"To truly compete today, not just in mobile, they have to cover all of these bases. It is really a question of the whole being more than the sum of the parts," he said.

Mobile ad growth
These companies are trying capitalize on the significant growth in mobile advertising, which is estimated to reach $20.6 billion by 2015.

However, hardware manufacturers want to incorporate ad networks into their operations not just because this would be a new revenue stream but also because it could attract developers to their platform by creating a new payment mechanism. Amazon, like the other hardware manufacturers, needs apps to support its ecosystem.

Samsung is also eyeing mobile advertisingn and will introduce a mobile private ad exchange later this year. The Samsung AdHub Market, which is being developed with OpenX, will enable advertisers to purchase mobile inventory from mobile developers and Samsung Electronics (see story).

Facebook is also rumored to be looking to further its aspirations by acquiring mobile operating system Opera, a move that could allow it to run mobile ad products more predictably across more devices (see story).

The appeal to brands of working direclty with hardware makers to serve ads is that ads can be more closely aligned to that platform's capabilities.

Brands can also often leverage the data a hardware manufacturer has about its users to better target its messaging.

For example, iAd takes into account people's purchases of music and other digital content in their targeting.

"Apple and Google may have access to data that an independent developer does not have access to," said Harry Kargman, CEO/founder of Kargo, New York.

"If they can leverage their access and successfully block third parties from accessing similar data that may offset the limitations in cross-platform reach," he said.

Scale an issue
The drawbacks include scale, as ads are typically only served in the hardware maker's own platform. Independent ad networks, in contrast, typically deliver ads across a variety of devices.

When Apple bought Quattro and Google acquired AdMob, these platforms went from being independent and working across platforms to serving ads only in the corresponding platform. If Amazon does something similar were it to buy and integrate and ad network, it may limit the impact such a move would have on the remaining independent ad networks.

"Given this constraint, independent ad networks can be more competitive as they have the freedom to run ads everywhere - fully cross platform," Mr. Kargman said.

"This reach is more compelling for an advertiser than just being constrained to a single platform or app type," he said.

Mobile Web
Another advantage independent ad networks have over hardware manufacturers' ad platforms is that they serve ads onto the mobile Web.

"Both iAd and now Google Mobile Ads (Admob) don't serve onto the mobile Web  ? arguably the fastest growing segment of mobile, although Google is working on integrating mobile AdSense," Mr. Kargman said.

"As brand marketers and agencies get more sophisticated, I believe that this constraint on the hardware-owned advertising platform will put them at a disadvantage," he said.

Despite the relative pros and cons of each kind of mobile ad platform, in the end what matters for agencies and brands is how effective the ads are.

As brands continue to experiment with mobile and find success, they are pouring more of their advertising budget into mobile, a trend that is likely to benefit both hardware makers and indepedent ad networks in the short-term, at least.

"From where we sit, it doesn't matter who owns the ad network," said New York City-based Chia Chen, senior vice president of the mobile practice for Digitas, Boston.

"At an industry level, what does matter is whether the ad networks are advancing the state of the art and making mobile display media buying more accountable, targeted and easier," he said. "And doing that at scale.

"Having hardware makers own mobile ad networks hasn't really diminished the independents. In fact, you could make a good argument that Apple's iAd really jump started the whole industry."