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We've known for a while to expect hockey-stick-like growth in mobile data. What's been missing is research that accounts for how the rise in mobile data will affect mobile advertising. BIA/Kelsey just filled that gap. In a press release issued yesterday, the researcher predicts that total U.S. spending on mobile ads will rise from $790 million last year to more than $4 billion by 2015.
Some will read that and get excited about Apple (Nasdaq: AAPL ) and Google (Nasdaq: GOOG ) , since the two companies own leading mobile ad networks. (iAd and AdMob, specifically.) You know what I thought when I read that? Yelp should go public right now.
Not only is the IPO market pining for good stock stories, but there's also a race under way to achieve scale in serving mobile ads. Yelp -- an on-the-go business directory that once was the subject of Google's affections -- is just a contender. The other two notables include:
- Foursquare, which has a deal with American Express (NYSE: AXP ) in which businesses will offer rebates to those who use their cards to purchase after checking in. The company is often mentioned in the same breath as Twitter and Facebook.
- Loopt, which, like Foursquare, has a deal with Groupon for distributing localized ads to those who check in using its service. Loopt has roughly 4 million registered users.
Fools will rightly point out that only yesterday I preached patience to Foursquare, a Yelp peer. There's time to build the business, I argued. What's changed in the past 24 hours? Nothing. I still believe Foursquare can be patient.
The difference between these two is that while Yelp is larger, serving some 50 million users monthly, it doesn't enjoy the thriving social component that defines Foursquare -- a network that, over time, could become a rich environment for advertisers.
Yelp needs even more scale (more businesses, more users, more check-ins, etc.) to combat Foursquare's threat, and the only way to get scale is to first get capital. An IPO would solve that problem.
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