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Mobile ad tech is hot; Video is on fire

Mobile ad tech merger and acquisition activity has already doubled year-on-year versus 2013, running at an average of one notable acquisition every two weeks. Companies acquired in 2014 include Admobius, AdColony, Apprupt, Burstly, HuntAds, Lyfe, mOcean, Simplytics and TapCommerce.

More specifically, video ad tech is on fire with some large acquisitions by Opera (acquired AdColony) and Facebook (acquired LiveRail) and one IPO (TubeMogul).

What makes mobile video advertising an appealing option for advertisers is that they already get the concept of building 15 to 30 second brand stories on video, coupled with established hard and soft metrics for determining success. Innovation in technology now enables the majority of smartphone and tablet devices to deliver crisp high-quality video clips, while enabling consumers to control the whole advertising experience from their device. Add on audience targeting capabilities across mobile Demand-Side Platforms and advertisers are able to consider integrated marketing campaigns that include mobile as well as online and TV.

Looking at recent eMarketer numbers from April 2014 for share of time spent per media channel daily, consumers spend on average 5% more time on mobile than online. Only TV continues to dominate share per media channel daily with 36% versus mobile’s 23%. However, that gap is shrinking year-on-year with mobile cannibalizing all other media channels and growing at an average rate of 5% per year. On that basis, mobile will more than likely equal TV eyeballs within two years and it’s that tipping point that’s driving in part the interest in mobile video advertising as a future platform to interact with consumers in an engaging way. By then, the majority of mobile video will more than likely be purchased programmatically with first party and third data enriching every bid request – something that TV is unlikely to shift towards any time soon.

The interest in video and more specifically mobile is likely to start to accelerate now as Facebook establishes itself as the innovator in mobile advertising across all formats. This tipping point is good news for everyone in the space as this is likely to challenge the current [lack of] allocation of mobile spend in TV budgets at large agencies.