Location-Based Ads Will Hit $6 Billion By 2015

"Location-based service" advertising will grow to over one-third of all mobile advertising in four years, according to Pyramid Research. But navigation services will be important, likely much more important, for mobile service providers, as most of the advertising will be earned by third parties.

By 2015, location-based advertising will be $6.2 billion,Pyramid Research says. In 2010, location-based advertising was $588 million, representing about 18.5 percent of all mobile advertising. Location-based advertising will generate 60 percent of all location-based revenue in four years. See MediaPost Publications Location-Based Ads Hit $6B By 2015 06/28/2011.

“Following many years of high expectations, the location-based services market is finally coming of age," says Jan ten Sythoff, Pyramid Research analyst.

Overall location-based revenue is expected to reach US$10.3 billion in 2015, up from $2.8 billion in 2010, ten Sythoff says. “There are a number of different factors driving market growth, including increasing GPS and smartphone adoption, success of new business models, continued growth of mobile advertising and the wider coverage and higher speeds of mobile networks,” adds ten Sythoff. See http://www.pyramidresearch.com/pr_prlist/WPR053111_RPLBS.htm.

Growing adoption of GPS devices is the key driver, helping a whole host of different applications and services to grow. “For mobile operators, this is an opportunity to drive new revenue streams, but it is also a threat because it means access to location information is no longer their monopoly.

In 2008 operators gained around 80 percent of all location-based service revenue. This has fallen to around half, but the total market has grown more than fivefold,” he says.