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Facebook (FB), Google (GOOG) Spur Surge In US Mobile Ad Spending

 December 18, 2012 02:22 PM

(By Balachander) eMarketer has raised its US mobile ad spending forecast for 2012, citing the early success of so-called "native" ad formats like Facebook's mobile news feed ads and Twitter's promoted tweets.

The media research company now expects overall spending on mobile advertising in the US to top $4 billion in 2012 from $2.61 billion projected earlier. The latest estimate represents a 180 percent growth, while earlier outlook called for a substantially smaller growth of 80 percent.

US mobile ad spending is expected to reach $7.19 billion next year and nearly $21 billion by 2016, eMarketer said.

eMarketer now estimates Facebook's (FB) US mobile ad revenues will hit $339 million in 2012 and $851 million next year.

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"The social networking giant offered no mobile ad opportunities at the beginning of 2012 but grew its mobile business at an astonishing – and unexpected – rate," eMarketer said.

Google (GOOG) also posted better-than-expected mobile ad growth in the third quarter, the digital marketing firm noted.

eMarketer estimates Google now controls a 56.6% share of the US mobile advertising market, spurred mainly by direct-response advertisers.

Google maintains a 93.3 percent share of the overall $1.99 billion US mobile search ad market. eMarketer expects spending on mobile search ads in the US to jump 55 percent to $3.6 billion next year — of which Google is expected to earn a 92.4 percent share.

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Meanwhile, eMarketer estimates Facebook will take a 18.4 percent share of the US mobile display advertising market in 2012, with Google expected to hold 17 percent.

Strong performance from competitors such as Google and Facebook suggests Twitter will also have a faster-than-expected transition of native ad inventory from desktop to mobile devices, eMarketer said.

The firm raised Twitter's US mobile ad revenue forecast to $134.9 million from $116.8 million for this year.

Apple (AAPL), which holds an estimated 6.7 percent of the US mobile display ad market, has the potential to capture more market share in the long run because of a strong capacity to invest and expand that business if it is successful, eMarketer said.

eMarketer added that Apple can continue to leverage the success of its iOS platform on iPhones and iPads in favor of iAds, as it has begun to do by phasing users out of native YouTube and Google Maps apps.



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