Blog Post

Beyond AdMob: There’s Plenty More Mobile Ad Networks To Go Around

The federal government is expected to rule any day now on whether Google’s acquisition of AdMob should be approved.

The concern is that the two companies will create a monopoly in the space before it even gets off the ground. We’ve made the case before on why the FTC should approve the deal, but one point that has gotten lost in the shuffle is that despite AdMob’s size, it is not the only mobile ad network with revenues, market share or a top-notch client list.

In fact, that’s far from the truth. To demonstrate, I was able to drum up a couple of lists, outlining revenues for the top U.S. mobile ad networks and market share by clicks. While AdMob and Google (NSDQ: GOOG) together would easily top both charts, there’s several players that could still become market-leading forces despite their relative obscurity.

The first chart estimates U.S. mobile advertising revenues in 2009, according to IDC Analyst Karsten Weide. As you can see, if Google and AdMob’s revenues were added together, it would be the largest ad network with $59 million in revenues and a 21 percent market share. But if the acquisition is rejected, Millennial Media is the largest with $35 million in revenues and a market share of 12 percent. (Note: Millennial Media’s strength is in the U.S., whereas AdMob has a large international presence, as well).

In the second chart, mobile research firm Ground Truth abstracted data from its sources to find out the leading ad networks based on the number of clicks an ad receives. The data was taken from a recent week in April and from a sample set of three million users. Whereas the first chart ranked revenues, this chart better shows the ad network’s reach. AdMob is listed as having a jaw-dropping 62 percent market share. Quattro Wireless, which was purchased by Apple (NSDQ: AAPL), has an 11.4 percent market share, and Millennial Media is in third with a 9.5 percent market share.

The one thing that really sticks out on both of these lists is the number of ad networks in general — in fact, start-ups have been able to compete successfully along side internet power-houses, like Google, Microsoft (NSDQ: MSFT) and Yahoo (NSDQ: YHOO) for some time. If Google does indeed gobble up AdMob, there seems to be plenty of more players for future acquisitions by others or even for a roll-up by investors with deep pockets.

5 Responses to “Beyond AdMob: There’s Plenty More Mobile Ad Networks To Go Around”

  1. mobithinking

    No one really knows the market share of any mobile ad network, because they do not reveal revenues (and estimating revenues from the limited amount of data available is very tricky, so we should all be grateful to IDC for their efforts). However it is difficult to see networks refusing to give revenue details to the FTC, assuming of course the FTC had the wherewithal to work out who the dozen or so main players are in the US and ask them.
    The Ground Truth number is surprising. But what are you referring to as ‘clicks’, is it page impressions or click-thru-rate? You’d expect AdMob to be big on impressions because it’s a mass-market, self-service, blind network. This means ads are mostly cost-per-click (CPC), so advertisers don’t pay anything unless the user interacts. If it is click-through then it’s more interesting, but even though you need to know how much is being charged per click, this can be as low as $0.01 a click on blind networks.
    Assuming that other US-centric networks are more focused on premium publishers, with more brand advertising (i.e. CPM) and higher charges for performance advertising (CPC), then they should be making a lot more revenue from a lot fewer sites.
    The thing that everyone seems to miss is that mobile advertising is nascent. And while 18,000 (the number of sites and applications that AdMob claims to serve adverts at) sounds big it is only going to be a tiny fraction of the number of mobile sites available globally (it’s even a small fraction of the number of applications available). I won’t go on… there’s more on this here:

  2. pawansahay

    Well there is a very important point here. Being that of serving global ads to consumers.The data here only talks about the market share in the US. Also the “number of clicks” graph does in no way tell how the ad network is performing in terms of revenue….(unless we know the CPC).

  3. GaryG

    Ground Truth data is weak, cones from a few tier 2 carriers, and they track clicks because they cant track impressions or reach. I think Comscore also has some good data that shuffles the share a bit, but directionally, Nielsen seems more consistently reliable. Ground Truth is a sideshow. But no matter, your point is right… lots of traction in the startups.

    My question is who is paying that appitalism blog guy?