Sponsored Data: 23% of Mobile Ad Spend in 2017

Press release today

TAMPA, Fla., March 27, 2015 /PRNewswire-iReach/ — Good news for consumers: mobile data will become more affordable as a new ad supported model called sponsored data begins to replace the “consumer pays” model in several global markets. Sponsored data will prove to be so popular that it will quickly grow to represent more than 23% of global mobile advertising in 2017, according to a new market research report, Sponsored Data: Mobile’s Next Monetization Model, from Mark Beccue Consulting.

“Consumers are nearing a critical crossroads with mobile data,” said Mark Beccue, president of Mark Beccue Consulting, “In some markets, Cisco is forecasting much greater demand for mobile data, but consumers in these markets are near their limits for monthly mobile data spend. Based on our modeling, drastic price reductions and heavy offloading will not be enough to match spend limits with demand. Only the addition of ad-supported sponsored data can help.”

The report identifies six markets where sponsored data will flourish over the next three years. “Our criteria for determining primary sponsored data markets was to identify markets that will be under the most mobile data demand/price pressure that also have high per capita advertising spend. Using this modeling, the U.S. ranks first,” said Beccue. The criteria eliminated what many see as a massive potential sponsored data market – China. “We do not believe the market drivers are present in China for significant market uptake of sponsored data programs,” said Beccue.

Use cases for sponsored data are rapidly evolving, broadening the appeal of sponsored data to a wide range of ecosystem players and end users. The report identifies five use cases as the most likely to drive sponsored data use over the next 3 years – ISPs/Messaging Apps, Mobile Apps, Enterprise BYOD, Marketplaces and Data As Currency.

The report:

Identifies and details key market drivers and barriers for sponsored data
Identifies which markets will most likely launch sponsored data, why they will do so and when
Profiles the key companies that will drive market change
Outlines sponsored data use cases and revenue models
Delivers three-year forecasts for sponsored data value, sponsored data ad spend
Mark Beccue is an independent market research analyst with more than 20 years of experience in mobile technology business strategy and market research. To purchase Sponsored Data: Mobile’s Next Monetization Model report, click here. For more information go to Mark Beccue Consulting.

Media Contact: Mark Beccue, Mark Beccue Consulting Inc., 813-777-7527, mb@markbeccue.com

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BUY NOW: Sponsored Data Research Report

Sponsored Data: Mobile’s Next Monetization Model, is now available for purchase, $1,200. Order by credit card here http://markbeccueconsulting.mysimplestore.com . To pay by wire transfer or corporate check, send an email to mb@markbeccue.com

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INTRODUCTION     In developed markets, mobile data has become a must have service. Consumers are voracious mobile data users:

  • Smartphone penetration will be greater than 50% of the entire population in 2015 in North America and every country in Western Europe with the exception of Portugal, Belgium, Austria and the Czech Republic, according to eMarketer .
  • Mobile data traffic grew 63% in North America and 39% in Western Europe between year end 2013 and year end 2014, according to the latest Cisco VNI.

But there are clouds on the horizon. There is a convergence of market drivers that could derail consumer’s love affair with mobile data:

  • Mobile data traffic will grow even faster over the next few years. Between 2014 and end of 2018, mobile data traffic in will increase 5X in North America and 7X in Western Europe (Cisco VNI).
  • Consumer’s willingness, ability to pay is limited. While mobile data prices have recently dropped, mobile expenditures continue to represent a substantial portion of consumer spending in many markets, from between 2% and 6% of gross median household income. How much more can most people afford?
  • Mobile operator revenues for mobile data significantly lag traffic volume growth. According to a recent McKinsey study, while mobile data traffic has increased 40X from 2008 to 2013, the revenues associated with it have barely tripled. Can mobile operators sustain their current business models?

So consumer demand for mobile data is big and getting bigger, but consumers may not be able to pay for much more, leaving mobile operators with a big problem. Mobile operators are going to have to deploy new business models, and Mark Beccue Consulting (MBC) believes the one that makes the most sense in many markets is sponsored data.

Sponsored data is simply this – an entity other than the end user pays for some portion of the end user’s mobile data use.

MBC believes sponsored data is set for significant growth in 2015 and 2016 in the U.S. and several other key markets, with impact for a host of players, including, mobile and fixed line service providers, online retailers, search advertisers, media publishers and enterprises.

This report will address the following:

  • Identify and detail key market drivers and barriers for sponsored data
  • Identify which markets will most likely launch sponsored data, why they will do so and when
  • Profile the key companies that will drive market change
  • Outline sponsored data business strategies, use cases and revenue models
  • Deliver three-year forecasts for sponsored data value, sponsored data ad spend