AOL has acquired Third Screen Media to strengthen its position in mobile advertising, a small component of online advertising expected to shoot up in coming years and become a multibillion dollar market.
To compete in the online multibillion dollar ad market, AOL has joined the crowd, announcing the acquisition of Third Screen Media, a mobile-advertising network and mobile ad-serving and management-platform provider.
Boston-based Third Screen Media, which has a mobile ad network and an ad management platform, will become a wholly owned subsidiary of AOL’s Advertising.com division, AOL announced.
Financial terms of the deal were not disclosed.
Third Screen Media’s network has “dozens” of brand advertisers, over 100 Web publishers and an undisclosed number of wireless carriers, AOL said.
Third Screen Media connects advertisers, publishers and mobile phone carriers on a common platform, allowing ads to be managed and delivered via WAP, downloadable applications, SMS, MMS and mobile video.
Like most major providers of online services, AOL is jockeying for position in the nascent mobile ad market, where spending is expected to double this year to $1.5 billion and grow to $11 billion by 2010, according to market researcher Informa Telecoms & Media.
AOL said dozens of brand advertisers, over a hundred mobile Web publishers, and wireless carriers participate in the Third Screen Media network.
Citing numbers from metrics firm eMarketers, AOL said that in the U.S., mobile advertising is expected to grow from $421 million in 2006 to $4.7 billion by 2011, while globally the market is expected to increase to $11.3 billion by the same year.
For AOL, which is in the midst of a years-long transition from a subscription fee-based business to an advertising-focused business, it is critical to have a strong mobile ad network.
The TimeWarner Company is not alone in its optimism for the mobile market.
Fewer than two weeks ago, Microsoft established its own mobile advertising storefront by agreeing to purchase ScreenTonic SA for an undisclosed sum.
Yahoo launched Yahoo Mobile Publisher Services, which includes a Mobile Ad Network, Mobile Content Engine, Mobile Media Directory and a Mobile Site Submit. That announcement followed several from Yahoo intended to push its mobile platform, oneSearch.
Google is well into the mobile advertising game, too. It is making plans for iPhone integration, testing how the sponsored links that drive its profits will work on mobile devices.
IAC Company Ask.com only yesterday introduced a GPS-enabled application for mobile devices. The application has room for plenty of advertising, Ask vice president Doug Leeds told internetnews.com.
As mobile devices overcome hardware limitations and bandwidth constraints, they are quickly becoming the preferred Internet-access vehicle for millions of people around the world. Consequently, marketers’ interest in promoting their goods and services in mobile devices is quickly picking up.
All this, despite the fact that during January only 17 percent of the 176 million, U.S. PC Web users accessed the Web from a mobile device according to media metrics firm eMarketers.