GigaOM » Millennial Media

Development strategies for the app-developer community

Thu, 27 Sep 2012 06:55:21 +0000

App developers are the cornerstones of the multibillion-dollar app market, supplying the talent behind the creation of the millions of apps on the market today. However, the developer community — composed mainly of individuals or very small companies — remains largely unknown and often underrepresented in the app market. And many developers view apps as projects rather than products, making monetization difficult. Given these challenges, those organizations and companies that can bring tools, resources, and a collective voice to this group will be an important factor in the evolution of mobile-app development.

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A look back at mobile in Q1

Tue, 17 Apr 2012 06:55:53 +0000

The first three months of 2012 proved eventful for the mobile space. Smartphone sales surged both in the U.S. and worldwide, carriers struggled to cope with the ever-increasing consumption of mobile data, and the fight for spectrum remained front and center. Apple continued its lead in the tablet space with the launch of the iPad 3, though Android is gaining traction, thanks largely to the Kindle Fire. New developments also abounded, with Millennial Media’s IPO as well as carriers’ building out their LTE networks. And as Microsoft and Nokia prepare to bring Windows Phone to the next level with an impressive new version of the operating system that could challenge iOS and Android, we are primed for a dynamic 2012. We analyze these trends and more in this report, as well as provide a near-term outlook for the next few months and beyond.

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2012 Mobile Ad Spend Revised Up To $2.6 Billion, Google Fueling The Machine

Ingrid Lunden — Thu, 26 Jan 2012 00:00:51 +0000

A big endorsement today for mobile advertising from eMarketer: their analysts today said they were revising up their forecasts for U.S. mobile ad spend to $2.61 billion, from their previous estimates of $1.8 billion. Why the rise? Google’s “exceptional” mobile advertising performance in mobile search advertising, and more reliable market data.

eMarketer were the same analyst house that last year revised up their mobile ad forecasts to over $1 billion — the first time a company had made that proclamation. In the event, those revenues reached $1.45 billion, they said, nearly double what they were in 2010. Their 2012 figure represents a rise of 80 percent on last year.

Yesterday Yahoo’s new CEO Scott Thompson claimed that there wasn’t yet a clear leader in mobile advertising, and that it was still an open field. That may be the case in that there is still a lot of room for growth, but there is actually a company dominating the mobile ad business at the moment: Google (NSDQ: GOOG).

In 2011 eMarketer says that Google had about 51.7 percent of all mobile ad revenues, with sales of $750 million. The second-two biggest platforms were far behind it. Apple’s iAd took in $92.4 million for a 6.4 percent share; while Millennial earned $90.9 million for a 6.3 percent stake.

Google totally dominated the mobile search category — an area where Apple (NSDQ: AAPL) and Millennial currently do not play — with some 95 percent of all revenues. Google was not shabby in display, either, leading in that category, too — although not as comprehensively, with only 24.8 percent of the market, with Millennial Media and Apple’s iAd very close to each other for second place.

As a sign of how fragmented mobile display advertising remains, “other” was the biggest category of all with 39.6 percent of all sales.

How different mediums will grow. eMarketer predicts that spend in mobile search will double in 2012, with $1.28 billion spent in the medium compared to $652.5 million in 2011. Higher-value display and rich-media ads will see less investment — which could either be a sign that mobile is still working to earn its stripes as a credible medium with big brands, or a tacit belief that these formats simply are not working as effectively as search at the moment.

Display will be worth $861.7 million, a rise of 93.5 percent on 2011; video will be worth $151.5 million, a very respectable rise of 122 percent.

Very usefully for those of us who take forecasts with a grain of salt, eMarketer has also published a kind of leader board for how much different research groups believe mobile ads will bring in the year ahead. eMarketer is coming out at the top end with some of the more bullish predictions.

Mobile marketing and advertising services have also attracted the attention of venture capitalists: it was one of the big draws in a record-breaking year for mobile investment, according to research from the investment bank Rutberg & Co.

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Mobile Ads Join The IPO Boom As Millennial Looks For Public Investment

Tom Krazit — Fri, 06 Jan 2012 06:13:40 +0000

Mobile ad company Millennial Media is going to try its hand in the public markets, filing papers Thursday for a $75 million initial public offering in hopes of raising cash to compete at a higher level. Registration documents show the company isn’t profitable but it posted a huge revenue increase over the last year as mobile app downloads soared.

It’s still very early days for mobile advertising, but the money tends to follow the eyeballs, and consumers are still snapping up smartphones and downloading mobile apps with aplomb. Millennial Media is second only to Google’s AdMob when it comes to putting ads on mobile screens, a business that earned it $69.1 million in revenue during the first nine months of 2011, according to the financial statements included with the registration papers.

The company is essentially breaking even, losing about $400,000 over that nine-month period but making money if you ignore pesky things like taxes and depreciation. Ads served through its technology reached 200 million unique users worldwide in December, and 100 million in the U.S.

As it does with several forms of digital advertising, Google (NSDQ: GOOG) dominates the mobile field with its AdMob holding. But mobile advertising is a game that is changing quite rapidly, eyed hungrily by those envious of how much time we spend engaged with our mobile devices.

And Millennial holds a bit of a trump card for those worried about the influence of Apple (NSDQ: AAPL) and Google over their mobile strategies: “We are the only one of the three principal mobile advertising platform companies that is not affiliated with a particular mobile operating system or set of devices,” Millennial said in its filing.

According to a source speaking to BusinessWeek, Millennial’s IPO could value it at between $750 million and $1 billion.

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Mobile ad network Millennial Media files for IPO

Ryan Kim — Thu, 05 Jan 2012 23:23:49 +0000

Millennial Media, the largest independent mobile ad network in the U.S., has filed to go public to raise a maximum of $75 million. The company is looking to capitalize on the big shift in advertising toward mobile devices, a market that is expected to grow rapidly in the coming years as smartphones and tablets proliferate.

Millennial’s platform serves up 40 billion ad impressions per month and reaches 200 million people worldwide through more than 28,000 apps that use Millennial’s network. IDC said last month that it has 16.7 percent market share in the U.S. behind only Google and ahead of Apple.

The company in the last nine months of 2011 generated $69.1 million in revenue, up from $29.1 million for the same period in 2010. It narrowed its net loss from $5.4 million to $417,000 over the same period while adjusted earnings before interest, taxes, depreciation, and amortization improved from a loss of $4.9 million to earnings of $650,000.

Millennial is poised to become a major player in mobile advertising, which is expected to grow to $20.6 billion in 2015 worldwide, according to Gartner. The company has a bigger opportunity as it expands internationally. Only 10 percent of its revenue comes from overseas markets.

To date, the Baltimore company has raised $65 million from Bessemer Venture Partners, Charles River Ventures, Columbia Capital and New Enterprise Associates. There were reports in 2010 that Research in Motion was interested in buying up Millennial, but the talks apparently broke down over the value of Millennial. The company is now poised to be an even stronger independent challenger to Google and Apple and can also put more distance between it and a gaggle of over other smaller competitors.

But the company has incurred losses since it was founded and it said it doesn’t know when it will achieve profitability. And Millennial acknowledged that even after going public, it may still struggle against bigger rivals. A lot will also depend on continuing to win over developers and on international expansion, which opens up opportunities but more risks as well. But having extra capital will also help Millennial acquire smaller companies and build up its marketshare.

As I’ve mentioned before, mobile advertising has a big upside because the devices they appear on are very personal and can use a lot of different signals to deliver very targeted advertisements to users at any time, no matter where they are. Mobile advertising is still small compared to display advertising but it’s going to be big as the world increasingly goes mobile.

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2012: Data, spectrum and the race to LTE

Thu, 29 Dec 2011 08:01:37 +0000

The past year in mobile has been even more eventful than most of us would have predicted. Our appetite for mobile data grew dramatically; Google’s Android continued its march to worldwide dominance; Amazon joined the tablet bandwagon; and AT&T tried and failed to acquire T-Mobile USA, among many other things. All of that activity lays the groundwork for a very promising — and very challenging — 2012. This research note serves both as a review of the major trends and events of 2011 as well as a forecast for the coming year. Companies mentioned in this report include Millennial Media, Quattro Wireless and Samsung. For a full list of companies, and to read the full research note, sign up for a free trial.

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Millennial Media Says Kindle Fire Impressions Growing 19 Percent Each Day

Ingrid Lunden — Tue, 20 Dec 2011 17:00:34 +0000

We still don’t have any exact figures from Amazon (NSDQ: AMZN) for how many Kindle Fire tablets it has sold, but the latest figures out from mobile ad network Millennial Media are the latest to suggest that it is selling very well, and that people are using the device to consume ad-based content.

Millennium, which bases its monthly data on mobile ads distributed across its multi-platform network, says that ad impressions on the Kindle Fire have been steadily growing since launch, at a rate of about 19 percent daily. While 19 percent doesn’t sound like a dramatic number, that works out to hundreds of millions of ad impressions every month, said the ad company.

Millennial also noted that the Fire tablet’s ad impressions has “slightly outpaced” impressions on the iPad when it first launched, in early 2010.

That could imply that the Kindle is more popular than the iPad, but in reality the comparison is not entirely like-for-like: the iPad was effectively the first tablet product on the market; two years on and not only are developers creating more content for these devices, but peoples’ tablet consumption habits have also evolved.

Elsewhere, Millennial’s numbers reflect a lot of the same trends that we’ve seen in previous months: Apple’s iOS is currently growing at a rate of seven percent, but it continues to lag behind Android in terms of impressions. Still, the iPhone stands out as the most popular single device on the ad network, accounting for nearly 14 percent of all ad impressions. The BlackBerry Curve ranks in second position, but several percentage points behind the iPhone, with the others trailing closely behind.

Notably, not one Windows Phone 7 device made it to the top-20 list:

http://david-smith.org/blog/2011/12/17/estimating-kindle-sales/

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Mobile Ad Figures Show Android Has Secured Its OS Lead, Apple A Device Lead

Ingrid Lunden — Tue, 22 Nov 2011 20:15:55 +0000

Monthly figures out from Millennial Media once again show that Android is the most dominant OS on its mobile ad network — the mobile platform from Google (NSDQ: GOOG) has held that distinction for 11 months now as dozens of Android-based smartphones continue to proliferate the market. But while there are definitely a good handful of handset makers that are benefitting from that Android popularity — HTC and Samsung among them — the handset maker that is still topping the charts for single most-popular device is Apple.

Millennial notes that in October, Android’s lead as the most popular platform on its mobile advertising network has grown, but not by much. It’s currently at 56 percent, compared to 54 percent two months ago.

That slight growth does not appear to have been at the expense of Apple and RIM (NSDQ: RIMM), which respectively have 28 and 13 percent platform shares. Those remained steady, while “other” decline by two percentage points. (Windows Phone and Symbian, for what it is worth, have held steady at one percent each.)

Apple, too, has held on to the lead it has maintained for more than year now: it is still the top mobile device maker, and still has the top mobile device, the iPhone. And its share remained steady as well, at 24 percent.

But it’s worth pointing out that Apple’s lead against other handset makers appears to be narrowing. Again, comparing this month’s results to those from two months ago, Apple has grown its share by 0.4 percent to 23.5 percent of all devices. The second-largest, HTC, is now at 18.11 percent, compared to 16.33 percent two months ago. And number-three Samsung has also grown its share to 17.24 percent compared to 14.55 percent previously.

What’s to explain that narrowed lead? It could be the continuous launches of new devices from the Android makers, against only one new device from Apple (NSDQ: AAPL). Or it could be to do with evolving user habits and the customer base grows. It could be simply a question of volume of devices on the market: that decline was also reflected in Apple’s last quarterly report, which noted a lower number of iPhones sold than some analysts had expected, even though it still reported sales of 17 million iPhones and 11 million iPads.

Mobile ad spend. Although iOS is behind Android by nearly 30 percent in terms of usage on the network, interestingly when it comes to ad spend, iOS continues to get a disproportionate amount of revenues, although they are slowly coming in line with the platform’s wider market share. Millennial notes that iOS gets 40 percent of ad spend, compared to Android’s 50 percent, with RIM at only six percent and the rest falling into the “other” category at four percent.

Media and entertainment remained the most-popular categories for mobile ads on both the Android and iOS platforms.

The very small shares given to RIM and “others”, including Windows Phone, raises some questions over whether those figures are actually universal, or whether they are do to with Millennial focusing its activities on Android and iOS.

But considering that Millennial is one of the bigger mobile ad networks, and given that mobile advertising remains one of the key revenue streams for mobile content — mobile ads are expected to bring in $1 billion in revenue this year — that doesn’t bode well for platforms like Microsoft’s Windows Phone, in terms of the message it sends to developers.

Depending on one’s risk-aversity, that could either spell a dead end, or an opportunity.

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Android leads in mobile ads; iPad ads jump 456 percent

Erica Ogg — Tue, 25 Oct 2011 14:06:34 +0000

Android OS, with its dozens of manufacturer partners, saw more total ad impressions than any other mobile OS in the third quarter of 2011. Android accounted for 56 percent of all impressions, according to Millennial Media’s Q3 Mobile Mix 2011 report out Tuesday. Apple’s iOS accounted for 28 percent of ads across all connected devices. But don’t count Apple out: From a single manufacturer perspective, its devices have the largest share of mobile ads.

Apple may have lost its crown as the most widely distributed mobile OS to Android, but it’s a the leading platform for developers and apparently advertisers, too. Though the iPhone has been largely responsible for that, the iPad has also seen skyrocketing growth for mobile ads in the last year.

As you can see in the chart, Apple devices represented 23 percent of mobile ads, the largest share of the 15 biggest mobile device makers, according to Millennial Media. The iPhone was responsible for a little over half of those impressions, and the iPad and iPod touch accounted for the rest, though Millennial didn’t breakdown the exact share of Apple’s tablet and touchscreen iPod.

Each Apple device still continues to grow too. In the last year, mobile ad impressions on the iPhone grew 60 percent, they grew 30 percent on the iPod touch, and a whopping 456 percent on the iPad.

As far as the competition goes, while Apple led all manufacturers with mobile ad share, HTC actually had the most devices on the list with six in the top 20 devices getting the most ad impressions. Each of those six devices are Android phones; Android accounted for 15 of the total top 20.

Across all platforms, the most popular app category in which to buy ads in was games, which grew to 34 percent of all application ad impressions.

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5 trends that will shape the future of mobile advertising

Neil Strother — Mon, 10 Oct 2011 21:24:55 +0000

Spending in the mobile advertising space will be approximately $4 billion worldwide this year, so despite some perceptions to the contrary, we can safely assume it’s an area to watch in the coming years.

To get a clearer picture of mobile advertising’s future, it helps to first explore the current landscape. Five trends in particular stand out:

More-relevant behavioral targeting. Currently, mobile advertisers use traditional methods of ad targeting: device, demographic group or context. But in five years, mobile ad targeting will become more relevant to a person’s behavior and current location. For instance, online advertising network Adverline has an AdNext server that builds a prediction model of spatial and temporal relevance for delivering ads to mobile users. The company has tested this with the COEX Mall in South Korea, and it found a 70 percent confidence level that ads displayed are spatially and temporally relevant.

Growing mobile search. Mobile search advertising is already a big driver of ad spending; this is where Google currently makes much of its money in mobile. In five years, this will still be the case, as people continue to use mobile devices to search for products and services. What will change is that, coupled with better targeting, search advertisers will deliver more relevant ads based not only on location and relevant keywords but also on more accurate predictability engines.

Better analytics. Right now, the tools for measuring mobile ad campaigns lack the sophistication that advertisers expect. The Mobile Marketing Association and other groups, such as the Interactive Advertising Bureau, have set up good guidelines. But these are still evolving, and not everyone plays by the same rules. In five years, the standards will have matured. Companies will agree more about what gets measured, and analyzing mobile campaign effectiveness will not be as big of a hurdle.

Greater interactivity. Most mobile ads today are delivered as relatively simple text or banner formats. They are clickable but not very interactive. Rich-media ads are available, too, but they are not as widely deployed for a variety of reasons: more cost, and not all devices render them well. In five years, interactive ads will be common, and users will be expanding, collapsing and manipulating them in ways that are still unfolding. This will unleash creative minds to show off their capabilities. Also, technology like augmented reality will make the interaction with brands and the world around consumers more interactive: Imagine looking at your mobile screen and playing a Zynga game sponsored by Coca-Cola, based on your physical surroundings.

Mobile-social as the “personal cloud.” Today the mobile and social worlds already collide with services like Foursquare and Gowalla. In five years, though, this functionality will likely evolve into what some Stanford researchers suggest is the personal cloud, which will be personal data that surrounds us wherever we go. It will also be shareable with whomever we choose and will be used to make purchases, among other things. Savvy advertisers will leverage this trend with relevant offers that provide value but still respect user privacy.

Meanwhile, companies like Google, Apple and Millennial Media currently rule the mobile advertising space, and while some of those will continue to have an impact over the next five years, others leading the way today will fade away or be acquired. To read about these, as well as more trends to watch, please see “The future of mobile advertising, 2011-2016” at GigaOM Pro (subscription required).

Image courtesy of Foursquare.

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