In a relatively short time frame, having a
smart phone has transformed from merely possessing a status symbol to a
necessary tool for the average person that facilitates almost every day-to-day interaction.
Yet mobile commerce is still at a nascent stage, making up only 8% of U.S.
e-commerce. Many in the mobile space observe that, despite booming traffic, monetization
remains a major challenge for mobile app developers. Remarks by Mary Meeker, a
partner at Kleiner Perkins, at a recent presentation on Internet trends
indicate that the future bodes well for making money from mobile. Meeker asserts
that mobile monetization "has more going for it" than early desktop
monetization, citing the very rapid user growth, increasing engagement, and
unparalleled rate of innovation. Further, Meeker notes that there is often a
lag time between increasing usage of new media and ad spend associated with it.
Within 3 years, she believes that mobile monetization will exceed desktop PC
monetization.
While this forecast may be overly optimistic, the underlying trend is
inevitable. Smart phone users exhibit diminishing reliance on PCs for basic
tools, such as email and web browsers, and mobile devices offer more convenient
functionality relevant to a host of regular activities (i.e., shopping, review seeking, street
mapping). This translates into greater mobile usage and hence more revenue
streams for businesses in this space. Meeker points out that GREE achieved
average revenue per member growth (roughly 2x within a year), which may not be
the best benchmark for the rest of the sector since it's a Japanese mobile
gaming company...
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