The strategic and financial media company, BIA/Kelsey, released a new report today that shows a forecast of revenues in the U.S. mobile advertising industry over the next four years. The forecast shows a growth from $491 million in 2009 to 2.9 billion in 2014.
Millennial Media, a mobile advertising network, filed for an IPO last week. We were waiting for this, as we’d predicted this would happen this year (though we didn’t think it would happen so soon).
How is Millennial Media’s business? Pretty good, actually. Here are the highlights:
- The company generated $70 million in revenue in the first nine months of 2011, from just $6.2 million in 2008;
- The company has never had a profitable quarter and is still losing money, $4 million for the first nine months of 2011.
- It’s pretty big and growing pretty fast: it processed 40 billion ad impressions in December 2011, and impressions are growing fast (see chart); Millennial Media has 16.7% market share according to IDC.
The Business
You’ll almost certainly see plenty of headlines about Millennial “never turning in a profit” throughout its road show. That’s correct. It’s also irrelevant.
Millennial is growing fast and into an enormous market opportunity–mobile advertising. It should not be profitable. Gartner thinks mobile advertising will be a $20.6 billion market by 2015, which may be conservative. That’s the opportunity Millennial is going after.
What’s more, Millennial Media seems to be gaining both market and operating leverage.
Millennial Media’s gross margin, which is roughly the amount it keeps after payments to publishers, improved from 34% to 39% in the first nine months of 2011 compared to the same period in 2010. This is happening as Millennial is growing both advertisers and spending per advertisers, as you can see in the chart at right.
What’s more, Millennial’s losses are narrowing, as you can see in the chart above.
All of this suggests that Millennial is gaining both market leverage–as it gets more established it can keep more of the revenue it generates for publishers–and operating leverage–gaining operational efficiency as it scales up.
The Market
One thing people might be worried about is competition from Apple and Google. We’re not. Here’s why:
- Even though Google is much bigger than Millennial (see chart at right, using data aggregated and estimated by Business Insider Intelligence), most of that is on owned-and-operated properties. Google’s AdMob network is bigger than Millennial’s but it is not dominant.
- Apple’s online advertising format/network, i Ads, has struggled in the marketplace.
- Ad networks are not a winner take all market. On the web, there are a few giants, and many profitable smaller players. There’s no reason why it couldn't be the same on mobile, and Millennial, as the biggest independent player, is well positioned.
THE BOTTOM LINE: Millennial Media looks like a strong business scaling up nicely in an exciting, fast-growing market. It’s kind of a boring business–an ad network, but it seems to be executing well. More importantly, don’t trust the media reports that will inevitably bang on about how Millennial has never been profitable. Yes, that’s true, but it doesn't matter.
2012年台灣行動廣告市場規模與應用趨勢
智慧型裝置+APP風潮 引爆行動廣告新體驗 規模上看33.2億元台幣 未來行動廣告新趨勢－擴增實境(AR)、NFC新應用
根據資策會FIND調查，2011年台灣行動廣告市場規模估計達到新台幣24.2億元，相較於前一年成長了39.1%，在各種廣告類型中，又以展示類廣告成長幅度最大；估計今年整體行動廣告市場規模可望達到新台幣33.2億元，成長率為36.9%，探究其成長動能主要來自於展示(display)、語音(audio)、影音(video)等類型的行動廣告，尤其可發現影音廣告在2012年相當備受看好。
為使國內廣告主與廣告業者能清楚掌握國內行動廣告市場現況與發展，資策會FIND於今年上半年特別展開台灣第一次行動廣告市場規模調查，同時也透過業者的觀點預測未來行動廣告行銷市場發展現況。本研究調查母體以資策會創研所推動的「行動服務與行銷SIG( Special Interest Group )」業者為主，輔以國內的App開發業者、行動媒體服務業者和媒體代理商等產業鏈上業者，透過問卷回填以及面訪方式進行。
一、智慧型手機與App風潮帶動展示類行動廣告大幅成長
根據資策會FIND調查與推估結果，台灣2011年行動廣告市場規模達到新台幣24.2億元，相較於前一年成長接近4成(39.1%)；在各種行動廣告類型中，又以展示類、語音類和影音類行動廣告成長幅度最大，其中展示類廣告相較於前一年成長比例更高達4倍；語音類廣告也成長高達2倍。展望2012年，估計整體市場規模可望達到新台幣33.2億元，在各種廣告類型中，又以影音類、語音類、展示類等行動廣告成長幅度最高。
近兩年在智慧型手機與應用程式(App)風潮下，帶動民眾使用行為及生活習慣的轉變，根據資策會FIND過去調查資料發現，智慧型手機使用者平均每週花17小時在智慧型手機上，因而使得如App或行動網頁(mobile web)使用大幅增加，同時也帶動了展示類廣告的成長。
参考：資策會FIND/經濟部技術處「科技化服務價值鏈研究與推動計畫」
YouTube 業務，過去6個月行動廣告營收翻兩倍
YouTube業務部副總裁華森（Lucas Watson）昨天受訪時透露，過去6個月行動廣告營收翻兩倍，暗示蘋果公司移除原本iOS內建的無廣告版應用程式（app）幫助甚鉅。
科技網站「蘋果內幕」（AppleInsider）引述彭博社報導指出，過去半年行動廣告預估貢獻YouTube營收3.5億美元，這家網路影音服務商10億用戶中，約1/4透過行動裝置瀏覽內容。
華森雖然未提，但廣告營收暴增的關鍵因素，可能就是蘋果公司（Apple Inc.）把內建YouTube app從行動作業系統iOS中移除的決定。去年9月iOS 6推出前幾天，谷歌公司（Google Inc.）獨立執行的YouTube app在蘋果的App Store上架，蘋果內幕當時報導，這版app讓YouTube得以在熱門影音播放前顯示廣告。
華森表示：「廣告業務已經爆發。這占我們很大一塊業務，我們清楚它的走向。」彭博社報導引用Wedge Partners Corp.分析師皮科南（Martin Pyykkonen）的預估，他表示，YouTube大概產生谷歌總營收的10%。此外，他估計行動廣告占YouTube廣告營收的20%至25%，意味在這家網路搜尋巨擘公布上季營收140億美元當中，這塊業務貢獻多達3.5億美元。
蘋果5月在App Store下載次數500億的倒數活動中，公布歷來下載次數最多的app名單，其中YouTube在免費程式中高居第4名。
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