Mobile advertising to hit $3 billion in 2007

The worldwide mobile marketing and advertising market is expected to be worth $3 billion in 2007, according to market research firm ABI Research.

The market will balloon to $19 billion by 2011, the firm said in a study published Tuesday. The bulk of the revenue will be generated by advertising through mobile search and video. In particular, broadcast mobile video will see a lot of mobile marketing activity. The firm predicts that by 2011 video-based ads will surpass SMS as a source of mobile marketing spending, and that advertising on broadcast mobile video alone will reach about $9 billion by 2011.

Everyone and their brother have been predicting a huge market for mobile advertising over the next several years. It's easy to see why. Today there are more than 2 billion mobile subscribers in the world. This compares with roughly 1.4 billion televisions and 1 billion PCs worldwide. Mobile-service operators could reap as much as 50 percent of this advertising revenue as they negotiate deals with content owners.

But ABI's analysts believe that there is still work to be done to make sure the promise is realized. Mobile operators, advertisers and marketing companies need to come up with different business models and strategies to target the opportunity.

While mobile marketing is fairly well developed in Europe and Asia, it's still in its very early days in the U.S., Judith Rosall, principal analyst for ABI, said in the press release. Major advertising agencies are still relatively inexperienced with mobile marketing campaigns and reluctant to utilize location-based services and technologies such as MMS (Multimedia Messaging Service) and mobile search that are still in the early stages of deployment.