Advertising spend on mobile games will increase tenfold over the next five years to reach $894m (£576m) in 2015, up from $87m in 2010, fuelled by increasing brand interest in mobile as an advertising channel, and apps, of which games are the dominant sector. The stats comes from a new report from Juniper Research.

As discussed in the report, games such as Rovio's Angry Birds are making a significant impact through offering full versions of their games free to end-users and funding them through in-game advertising. Opportunities in this area have been strengthened by the launch of key platforms designed to optimise the deployment of ads within applications, most notably Apple's iAd in July 2010. Similarly, the report finds that games are being successfully deployed as marketing tools by brands including Barclaycard and Volkswagen, providing new revenue opportunities for developers.

According to Mobile Games report author Daniel Ashdown, "Angry Birds has been a huge hit over the last year on the iPhone since its launch; but arguably its relative impact, in terms of downloads, has been bigger on Getjar and, more recently, on Android Market, as a result of offering the game free with ads. Users get a great game for free, but advertisers get significant product/brand exposure; the same is true of mobile games as marketing tools."

Nevertheless, the report forecasts that, while growth in ad spend on mobile games will be higher than end-user revenues, this latter business model will continue to be the primary source of revenue for players in the industry. By 2015, end-user revenues, which comprise those from pay-per-download and in-game purchases, will still be ten times higher than ad spend.

There’s more information about the report on the Juniper website.