Despite the difficult economy, nearly 270 million mobile advertising banners were served in the United States during the third quarter of 2008, according to BuzzCity, a Singapore-based mobile social networking and advertising company.

This means that even in a difficult economy, the number of ads served nationwide since the end of the first quarter this year has increased 96 percent on. Mobile Marketer's Giselle Abramovich interviewed KF Lai, BuzzCity's CEO, on his outlook for mobile advertising. The interview:

What is the current state of mobile advertising?
While mobile advertising is in its infancy in most markets, there are several markets where it is progressing further.

These are South Africa, India, some parts of Western Europe, and to a lesser extent, the United States.

Usually, in the early stages of development, mobile advertising is supported
by mobile content companies and venture-backed companies looking to increase
their own mobile traffic.

When brands begin to move their ad budget into mobile Internet, beyond the "experimental buy", the market begins to mature.

Where do you see it going in 2009?
More markets will move towards maturity.

We expect to see Malaysia and Thailand to turn first, and then probably followed by Indonesia towards the end of 2009 or early 2010.

What can you attribute the growth to in 3Q?
Carriers lowering mobile Internet rates, or introducing flat rates, or quasi-flat rate charging.

Also, increased awareness of the possibilities of the mobile Internet, particularly in the U.S has contributed as well.

More people surfing means more ads served and the corresponding revenue.

How can mobile social networks monetize their offerings?
Advertising will probably continue to be the main method, although mobile social networking will have to deal with relatively low click rates like their online brethren.

Mobile social networks, however, can act as core properties to attract traffic, where traffic is then monetized in "adjacent" media properties that have higher yield.

Mobile social networks can also monetize via sales of virtual items.

But this requires the skill to create desirability of the virtual items, and manage the scarcity.

It is not an easy skill for companies to acquire.

What type of reach does mobile give advertisers?
It depends on the market, and really varies from market-to-market. In markets like South Africa, the population is 40 million, Internet penetration is about 6 million, but mobile handset ownership is almost 100 percent.

Out of these 40 million Internet users, we estimate that more than 6 million are already surfing on the mobile Internet, and the number will rise (one of the major search engines disclosed that they are now seeing more searches coming from the mobile Internet than fixed-line Internet in South Africa).

Over time, we expect the mobile Internet population to surpass the wired
Internet population.

However, the users are likely to be from different demographics.

We expect these to be less desk-bound, knowledge-workers, and more blue-collar in terms of demographic.