• by Mark Walsh  @markfwal, September 16, 2008

The report cited wireless operators' development of new campaigns both on carrier portals, or "decks," and off-deck, capitalizing on advertisers' abilities to cover production costs and help reduce customer costs. With nearly 85% of Americans using cell phones, operators have a customer base of almost 250 million to be tapped for mobile ad revenues, according to Frost & Sullivan.

While encouraging the growth of targeted mobile advertising, the report warns operators against sharing subscriber information with overzealous marketers. "Although advertisers will want to delineate their target audience by demographics, location, handset, and other parameters, mobile operators should be cautious while providing information to preserve their subscribers' privacy," it stated.

Ideally, mobile advertisers want messages to be immersive and appear as informational content. They can do that by delivering relevant messages within mobile applications and services and then tracking their usage history, preferences, location, and device types.

The research firm's projection seems conservative compared to others including that of eMarketer, which forecasts mobile ad spending of $6.5 billion by 2012 and $1.7 billion this year.

But Frost & Sullivan sounded a bullish note about the mobile ad future. "Adoption of mobile advertising by the nation's largest mobile operators and innovative mobile virtual network operators (MVNOs) is a testament to the perceived potential of the market," said Frost & Sullivan analyst Vikrant Gandhi, in a statement.

That view, however, does not seem to take into account the demise or scaling back of some high-profile MVNOs in the last year or so--including Amp'd, Disney Mobile, Mobile ESPN and Helio. Even Virgin Mobile, usually cited as the most successful virtual operator, has struggled recently as a newly public company.