Amid all the IPO hysteria that has recently surrounded Facebook, the social network also made news by announcing it plans to introduce mobile advertising for users who connect to the site through a smartphone app. In just its first year, where the ads will only be active in six countries, that initiative could bring in more than a billion more dollars to the soon-to-be public company's bottom line.
Specifically, moblie research group MobileSquared predicts that within the first 12 months after Facebook mobile ads go live, there will be a $1.2 billion revenue stream that didn't exist before. That may sound impressive, but when you factor in the number of users who are active in the mobile Facebook world, that's only around $6.50 per user per year. Most of us could probably live with that kind of burden.
In terms of where the ad revenue will come from, MobileSquared says more than half ($653.7 million) will be driven from US Facebook users, while the UK will add $166.6 million and France, Germany, and Italy will each contribute around $100 million, The final market, Spain, is expected to draw in around $70 million in ad spend. The research firm also noted that in 2012, Google's mobile ad revenue should be around $2 billion. So it is still the leader in this niche market, but if Facebook is able to hit the ground running at greater than half of Google's level, that would be impressive.