Ads finally heading to mobile phones?

The long awaited uptake of the potentially lucrative mobile advertising market by advertisers and consumers has actually started to happen, according to industry leaders.

Ads finally heading to mobile phones?

Advertisers have great hopes for the mobile phone market due to the personal nature of phones and the potential to know where customers are at any time, but have been held back by the small screen size and potential hostility from customers.

Finnish firm Blyk has tried offering ad-funded calls and texts to consumers in Britain, but the service was shut down last year.

However, the sector got a major boost from Google’s deal to buy mobile ad firm AdMob late in 2009, and Apple’s acquisition of Quattro Wireless.

“Across our markets we are getting this fall messages from advertisers that for 2011 they have created separate mobile budgets,” Andrew Osis, chief executive of Calgary, Canada based Poynt, told Reuters in an interview.

Poynt’s local search application for smartphones has 4.5 million active users in North America and Europe.

Osis said the total sums were still small when compared with the online advertising market, but the growth in demand was clear.

The US mobile advertising market is expected to grow to $5 billion by 2015 from $800 million this year, said mobile ad network Smaato in a whitepaper quoting research from mobilesquared. Steven Nathasingh, director of research firm Vaxa, said mobile devices’ limited functionality has hampered growth on mobile advertising revenues so far.

“The newer phones and tablets will change that as the technology rapidly advances and lower prices drive higher adoption. Mobile advertising is at the beginning of an inflexion point,” he said.

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