Mobile is best trend

In 2011, global spending on mobile media topped $100 billion for the first time, according to a report released by Strategy Analytics.  The total amount spent by consumers on data plans, apps and media content was $121.8 billion, and that number is projected to jump more than 13% to $138.2 billion this year.  

Of the nearly $139 billion estimated to be spent on mobile media, the lion's share, or 60%, is projected to go toward data plans as data-hungry consumers are estimated to spend $82.8 billion on data plans alone, up 9.5% form last year. This makes mobile operators key beneficiaries of the significant chunks of money being spent on mobile. 

The amount spent on smartphone apps is anticipated to jump over 30% to $26.1 billion, making apps the second biggest source of revenue in mobile media. 

More than 23 billion smartphone apps were downloaded last year, and this year could see as many as 32 billion. For this reason, apps are quickly displacing mobile display ads as the place to spend marketing dollars. In the USA and Western Europe alone, $1.7 billion was spent on in-app advertising vs just under $1 billion for display ads on the mobile Web.  

Video on mobile devices is growing as well, as 280 billion videos are estimated to be viewed this year, almost tripling the 108 billion videos watched in 2011. But even though revenue from video is expected to grow 24% this year, revenue is expected to be $3.6 billion, accounting for 2.4% of total mobile media revenue. 

Mobile ad growth nearly doubling

While spending on apps and data plans is significantly higher than the amount of money marketers currently spend to advertise on mobile devices, mobile advertising is growing at a faster clip. 

The amount advertisers and marketers are projected to spend is $11.6 billion, nearly double the $6.3 billion spent in 2011. This brings total media spending - $139 billion (for apps, data plans) plus $11.6 billion (mobile advertising) - to just below $150 billion this year, up 17% from last year.

The Strategy Analytics report says that advertising revenue on mobile apps in the U.S. will increase by 118% this year, but there is some question as to whether that money is being spent wisely.

A report by Nielsen in March of this year found that U.S. consumers were actually less likely to make purchases based on mobile ads than those in European countries. That report stated that only 6% of U.S. Smartphone owners went out and bought an item they saw advertised on their phone, compared with 18% in Italy, 15% in Germany and 14% in the UK. When asked if they made a purchase directly from their device based on an ad, only 4% of U.S. Smartphone users answered yes, while 7% of UK respondents, 8% of Germans and 12% of Italians said yes.

Nielsen also found that only 26% of U.S. consumers trusted mobile ads, while 46% trusted TV advertisements and over 50 % trusted ads on branded websites. 

Mobile Informational Capital

Foursquare's last round, a $50 million raise in June 2011, valued the company at $600 million.

It's starting to look like all that hype was unwarranted.

Foursquare is no longer the only social network built for the mobile Internet user – now there is Instagram and Path and a few others – and it is definitely not the most exciting new social network since Facebook; that's Pinterest.

The biggest problem for Foursquare is that, compared with other mobile social networking products, not that many people seem to use it.

On its about page, Foursquare says it has 15 million registered users. By comparison, Instagram has 35 million users.

According to AppData, 570,000 people share Foursquare data into Facebook every day, 3 million every month. Pinterest, which only launched in 2010 has 1 million users sharing data with Facebook every day, and 10 million sharing every month. For Instagram, the numbers are 2 million and 11.5 million.

Apple's iTunes store doesn't expose how many times an app has been downloaded, but one rough measurement of an app's downloads and user engagement are the number of reviews users have written.

Simply put: not that many people are using Foursquare, certainly not compared to the amount of people using Instagram, Pinterest, or even Yelp.

The good news for Foursquare is that CEO Dennis Crowley wisely capitalized on the app's early hype to raise a boatload of cash last summer (with minor dilution). Foursquare only has about 100 employees right now, and with $50 million in the bank, it can probably afford to keep them employed for another three or four years.

The even better news for Foursquare is that investors and executives know the company needs to pivot in some way, and they are trying to figure out how.

One idea we've heard is being floated around is to turn Foursquare into more of a Web company and less of a mobile-only platform. It could be something like Yelp or MenuPages.com – with a search engine-friendly Web page full of user-reviews and tips for every restaurant on the planet. That's a good idea, especially since Foursquare tips are very useful.

That kind of pivot would also make Foursquare a more useful product to the majority of users out there who just want to consume data, not create it through a gimmick like "checking-in." (Likewise, most YouTube users don't upload videos; they just view them.)

The only downside is that Foursquare investors probably were hoping the company would turn into more than another Yelp. Yelp, now a publicly traded company, has a $1.5 billion market cap. Venture investors expect more than a 3X return.  But then again, there are worse fates for startups with lots of early hype and little user-adoption three years in.

 http://www.businessinsider.com/foursquare-may-not-be-toast-yet-but-its-browning-at-the-edges-2012-4?