On-deck mobile social networking revenue to reach $412M in 2012: Study
April 29, 2008
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A new study claims that revenue from on-deck mobile social networking services nationwide will reach $412 million in 2012.
Mobile social networking is gaining more support from tier 1 and 2 operators as well as wireless carriers and additional marketing support, according to consultancy Frost & Sullivan.
“While the extension of popular online social networking communities onto mobile phones is a major growth driver, it is unreasonable to expect the same level of functionality as is offered through the PC,” said Vikrant Gandhi, senior analyst at Frost & Sullivan, in a statement.
“Mobile social networking services clearly need to be targeted toward mass-market phones in order to gain traction,” he said.
Three converging trends drive mobile social networking, per Frost & Sullivan: emergence of popular social networking services online; increasing penetration of the mobile Web; and the development of mobile advertising.
The findings were published in Frost & Sullivan’s “An Insight into U.S. Mobile Social Networking Markets” report.
Online social networks such as MySpace, Facebook and LinkedIn now all have mobile versions through the mobile Internet, whose penetration is at 15 percent, the consultancy claims.
Also, mobile advertising is emerging as a key revenue model for off-deck mobile social networking providers.
However, a major challenge is to create dedicated and effective mobile advertising models to offer targeted ads to the mobile social community, Frost & Sullivan said.
What that requires is cooperation between advertising service providers, mobile social networking firms and wireless carriers. Users of mobile social networks should also consent to share more data about themselves.
That said, the ads should be more immersive and not simply banners within mobile social networking sessions, the consultancy said.
But it is the ad model that needs major consideration.
“For instance, the present cost-per-thousand for mobile advertising within mobile social networking services is not very high,” Mr. Gandhi said in the statement. “Similarly, the fill rates or the ability to monetize the available inventory are also low.”