Location based services are all the rage. Just this morning Shopkick announced another partnership – this time with Crate and Barrel. Foursquare recently exceeded 5M users. Gowalla launched its newest update providing an overhauled user experience. Articles on the topic have appeared everywhere, including Fierce Wireless (Warning shameless self promotion at the last link). But despite the hype location based applications are still just at the larval stage.

Today, stalwarts remain the key players. Recently, we revamped our Apps Database – which used to contain the top ten apps for iPhone and Blackberry in the US. Our new iPhone database contains a more global view - capturing the top 100 (free, paid and grossing) apps - in 62 countries. The data shows that Facebook remains the dominant player – regardless of region. Out of 124 free apps lists (2 weeks of 62 countries) Facebook and Skype appeared on 98% of the lists. Windows Messenger appeared on 75% of the lists.

Interest in social networking is not restricted to mature markets either. In fact, the Middle East and Africa are most likely to download social networking services - with nearly 11% of all free iPhone downloads coming in that category – almost 2x that of Western Europe.

Clearly there is intense interest in social networking even if there is not yet sustained interest in location based social networks. Foursquare and Gowalla combined for 12 total appearances (11 for foursquare and 1 for Gowalla) managing to garner placement on less than 10% of all free apps lists. However, many of the companies, such as McDonalds, that were bold enough to partner with these up and coming companies have found great success as these services continue to slowly grow, expand, and increase their influence.

In fact, these services will be so important in 2011 that we dedicated an entire prediction about them in our recent report 11 for '11: Predictions on the Future of Mobile Media (although to know what we predicted you’ll need to read the report). Additionally, we will be hosting a webinar on Thursday December 17, 2010 at 10:00 EST to discuss the future of social networking and how location will come to play an increasingly important role in 2011 and beyond.

Please find more information and register at the link below.

Mobile Social Networking: A Platform For Success?

On 1st December 2010 US ad network Millennial Media officially announced its expansion into Europe, entering into a fairly crowded mobile ad network space, which also includes Google (which acquired AdMob in 2010), Apple, Smaato, Yahoo, Microsoft, 4th Screen Advertising, Unanimis, Yoc, Sofialys, and DaDa among others. Strategy Analytics was invited to its launch presentation to hear more about its plans and ambitions. Globally, the Millennial Media mobile ad network is currently delivering 16 billion page impressions monthly, with Europe generating 2 billion (just 12.5%) of that. With Ofcom today indicating that 26%, 21% and 18% of cellular users in Italy, Spain and the UK respectively owns a smartphone, there is clearly still potential for growth in Europe, as more mobile phone owners substitute feature phones and expensive pay as you use data tariffs with smartphones tied to generous data plans. Indeed, Strategy Analytics also believes there is growth opportunity in Europe, and predicts strong growth in mobile display advertising with advertiser expenditure rising ten fold $600 million in 2010 to $6 billion 2015, as more users drive mobile web page impressions. So where does Millennial Media believe it will fit in to the existing mobile advertising market place? Well, it’s aiming to find the middle ground between premium ad networks like 4th Screen Advertising, and Orange owned Unanimis, which aim to maximise inventory return for premium publishers to get high CPMs, and blind ad networks aimed at filling large volumes of unsold inventory where its all about low CPMs and volumes (see figure above). Millennial Media does not intend to compete with the higher value mobile marketing campaigns from Blyk, Hipcricket or mobile operators like O2 Media. Personally, I’m a bit sceptical this gap really exists. So ultimately I do expect Millennial to fall into the blind ad network bucket over time. On the other hand in these tough economic times brand advertisers are increasingly looking for metrics to prove advertising ROI, in which case Millennial Media will be well positioned to grow. Either way, validating Millennial Media’s claim is something we hope to do as we continue to conduct more research into this area. Nitesh Patel