As Mary Meeker’s annual Kleiner Perkins opus on all things Internet continues to prove, globally the Internet is an increasingly mobile phenomenon. Seventy-three percent of people in the world have a mobile phone, and 22 percent have a smartphone. That compares to 11 percent penetration for laptops and 10 percent penetration for desktop PCs.
However, there’s a risk of oversimplification in talking about the rise of the global mobile Internet population. For all that everyone, myself included, tends to refer to “the mobile Internet” like it’s just one thing, in reality it’s a convenient umbrella term lumping together numerous different devices (phones, tablets, wearables…), network technologies (3G, 4G, Wi-Fi…), operating systems, and even media channels (Web, apps…). I strongly believe that the mobile Internet (see, I did it again!) is going to open up amazing new opportunities for consumers around the world to connect with media.
Follow the Money
For the third year, IAB’s Mobile Center and IAB Europe partnered with IHS to size the global market for mobile advertising. There was $19.34 billion in mobile advertising in 2013, a growth rate of 92 percent relative to 2012. Globally the market is dominated by search and display revenue, which take close to equal shares, while messaging has passed its prime as a generator of advertising revenue.
However, the global pattern belies some significant regional variations. Latin America, where mobile advertising is still at a relatively early stage, saw explosive, 215 percent growth year-over-year, while in Asia-Pacific (APAC), home to more mature mobile markets, grew “only” 68.5 percent.
In Europe and North America, search takes the largest component of mobile ad revenue. In APAC, search and display split the market. And in the Middle East/North Africa and Latin America, messaging accounts for almost half of mobile ad revenue.
Thus, while the mobile Internet is definitively a global phenomenon, it is not happening everywhere in the same way or at the same pace.
A Global Theme, Two Main Local Variations
Another view into national differences emerged from the research project that a dozen of the global IABs jointly sponsored to look at mobile and the 2014 World Cup. The mobile Internet served a vital link helping people connect with friends and other fans as well as to keep up with their countries’ progress regardless of where they were when the tournament was on. But details on how smartphone owners used their mobiles were notably varied from place to place.
Abstracting from the patterns in national differences, it seems the mobile Internet develops in two phases: communication, then content.
- In countries where smartphone penetration is lower, 3G or 4G networks are relatively less available, and/or where mobile operators charge high data tariffs, communication is the dominant use of the mobile Internet. SMS and to some extent MMS are the core use, and media companies and advertisers should focus on those messaging channels rather than developing Web or app offerings.
- As smartphones become more prevalent, and network speeds support more media usage (assuming costs aren’t too high), media consumption on mobile soars. This is when the possibilities of the mobile Web and apps start to become realities, and as the audience grows, advertising revenue follows.
In some ways this parallels how the PC-based Internet evolved from dial-up to broadband. PCs and network speeds got better, connectivity became more reliable and convenient, and suddenly a medium that was dominated by email, chat, and basic websites blossomed with photos, videos, and other rich experiences.
Sharing Mobile Knowledge Globally Is Key
Because mobile happens at different speeds in different places, establishing internal lines of communication so that mobile experts in different markets can share knowledge makes good sense. This is akin to the lines of communication we’ve built with our fellow IABs, but I realize how hard this kind of communication can be, even (or perhaps especially) within an organization. The mobile mavens in any given region or country have enough on their plates, and little bandwidth to look around at what their colleagues are doing.
But whether it’s app development, use of technology standards like HTML5, MRAID, or responsive design, or managing mobile ad operations, the value of sharing these kinds of expertise across national boundaries is significant. The faster learning can be disseminated from early adopter markets to later ones, the faster a company as a whole can truly start to reap the benefits of the mobile world.