After the hype, the reality, and some hard, independently-researched figures. Mobile ad spend in the UK exceeded market expectations in 2008 to reach a total of £28.6m, according to a study by the Internet Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC). 
As mobile advertising becomes increasingly important for operators and advertisers, the study – a UK first – shows that mobile ad spend bucked all market trends, doubling in size on a like-for-like basis in 2008, increasing by 99.2 per cent year on year. Investment in mobile advertising grew at a faster rate than predicted, the study says, as more UK brands invested in the medium due to its exceptional targeting, immediacy and return on investment.
The £28.6m total breaks down as follows:

• £14.2m – Mobile display advertising, including banners, text links, tenancies pre/post roll and in-game ads
• £14.4m – Paid-for search advertising on the mobile Internet

The IAB notes that the figures represents just mobile media spend, and therefore do not include mobile marketing expenditure on SMS, MMS or other mobile advertising/marketing campaign production and delivery costs. This ensures the figures are comparable with all other media.
These first mobile figures correlate strongly with the early days of online advertising.  When the IAB and PwC study was first released in 1998, the Internet advertising market was worth £19.4m. In 2008, online advertising rose to £3.35bn, accounting for 19.2% of all advertising spend. 
The IAB has identified six key factors behind mobile advertisings growth, namely:

• A bigger audience than ever – Mobile Internet usage grew from 8.6 million in December 2007 to over 11 million in Dec 2008, with the number of users on unlimited data plans rising by 109% in 2008.
• Mobile offers a great user experience The IAB cites the Orange Exposure 2 study, which found that 70% of mobile media users find innovative ad formats actively appealing.  
• Social networking on mobile – People using social networks on their mobile phone grew by 180% in 2008. According to recent research from the IAB, 44% of 16-24 year olds have checked their social network profile via their mobile phone.
• Better, smarter handsets: The 3G iPhone launched and has transformed usage, the IAB notes. iPhone are around seven times more likely than average to browse on their phones daily for news and information. Overall, penetration of 3G handsets increased by 36% in 2008.
• Growth in mobile departments – More media agencies in the UK are appointing dedicated heads of mobile, charged with working full time on the medium to educate teams and promote the channel.
• Industry initiatives – The IAB is working with operators and the key mobile advertising players to educate the marketplace. As knowledge grows, it says, it is becoming much easier to plan and buy successful mobile advertising campaigns.

The IAB officially widened its remit to include mobile Internet advertising in July 2008, when the five main UK networks 3, O2, Orange, T-Mobile and Vodafone became members. Since then, it has invested in educating the market about the potential of mobile media, through a programme of events and research initiatives. 
In the coming weeks, the IAB will launch a How To guide on briefing, planning and executing campaigns for marketers. It is also currently conducting research into the effectiveness of mobile advertising, with the results due in early June.
This study is a UK first and means the IAB can accurately prove and track how much marketers are spending on mobile, says Jon Mew, Head of Mobile at the Internet Advertising Bureau. The sector is in its infancy, but is considerably bigger than the market was expecting. Thanks to these landmark figures, we know the real value of the mobile advertising industry, and will now be able to chart the mediums growth with confidence.
Theres more information on the IABs mobile advertising initiatives here.