With screens on mobile devices such as smartphones and tablets becoming larger and higher-resolution, watching video on your iPad or Android phone is only limited by your bandwidth, not by the screen. And as long as you are on WiFi, these tablets and touchscreen phones are perfectly serviceable video viewing devices. Revenues from mobile video in the U.S. are estimated to grow from $548 million in 2010 to $1.3 billion in 2014, according to eMarketer.
The mobile video revenues are broken down into subscription, pay-per-download, and ad-supported. In 2010, subscriptions will represent 75 percent of revenues ($413 million), pay-per-download revenues will be 18 percent ($100 million), and ad supported will be 6 percent ($35 million). By 2014, that mix is expected to be 67 percent for pay-per-download ($901 million), 18 percent for subscriptions ($235 million), and 15 percent for advertising ($206 million). Numbers may not add up to 100 due to rounding.
The five-year annual growth rate of mobile video revenue overall is projected to be 25 percent, with ad-supported revenue growing the fastest at nearly 60 percent annual growth.
Remember, this is mobile video advertising. The Interactive Advertising Bureau pegged total online video advertising revenues last year at $1 billion. Within three years, mobile video revenues will be at that level, but that vast majority is expected to be subscription or pay-per-download instead of free. I’m not so sure mobile devices will be so successful in creating a paywall around video over time. What do you think?