The surge in popularity of mobile internet with the rise of products like the iPhone could present a threat to Google’s advertising revenue stream, BusinessWeek reports.
The reason is very simple – Google can fit about 10 ads on a standard computer screen, but the smaller screen on mobile devices can generally fit no more than one or two.
It is for this reason, some in the industry speculate, the Google has moved to get into the mobile broadband space with its Android venture. Android is a collaborative effort to design a standard mobile phone operating system – in effect, the framework in which mobile internet ads will sit.
BusinessWeek theorises that the smaller space for ads available on mobile devices may see a kind of divide in the way online content is consumed, with PCs being the realm of free, ad-supported content, and mobile devices containing more content for which the user will have to pay.
Alternatively, the opportunity to deliver uniquely personalised and tailored content via mobile devices may mean companies like Google will simply be able to charge more for ads in that format – for example, technology that enables stores to send ads to people as they walk by is already in existence.